Industry News

Market Reporting that Matters

September 2017 Jobs Report

Hurricane Hits Hamper Hiring

Monday, October 9, 2017


The U.S. economy lost 33,000 jobs in September, according to the U.S. Bureau of Labor Statistics (BLS), the first monthly loss in seven years as Hurricanes Irma and Harvey temporarily disrupted hiring.

The unemployment rate declined to 4.2%, thanks to an increase in the number of employed counted in the smaller sample household survey and a slight increase in the civilian labor force. Note that the loss reflected in the payroll survey is not evident in the household survey because of methodology and sampling differences.



California Markets Slide Out of Top 10

Will the Aging Millennial Population Harm the Apartment Market?

By the Numbers

Revisions to the previous two months’ numbers resulted in a net total decline of 38,000 jobs to the estimates. July’s job-gain figure of 189,000 was revised downward to 138,000, while August’s was revised up from 156,000 to 169,000. Economists expect a bounce-back in October and November – reflecting returning displaced workers and those involved in rebuilding and clean-up.

With the disruption, annual job growth clocked in at 1.2% in September, 20 basis points (bps) less than August 2017 and 60 bps less than September 2016. Annual job gains were 1.777 million, 852,000 less than September 2016’s total and the first time the annual rate dipped below 2.0 million since March 2013.

Average hourly earnings (wages) for privately employed workers continued to rise moderately, with September’s average of $26.55 representing a 2.9% increase from a year ago, the second largest annual increase since 2009 (December 2016 was the largest). Annual wage growth has averaged close to 2.6% since late 2016.

  Click to enlarge in new tab.

September’s U3, or “headline,” unemployment rate of 4.2% was down from 4.4% in August. The civilian labor force participation rate was up 20 bps from last month, and by the same amount from last year. The employment-population ratio of 60.4% shot up 30 bps from the previous month and was 60 bps higher than September 2016.

The number of part-time workers for economic reasons (5.12 million in September) decreased by 133,000 from August, and was down by 752,000 from September 2016. The U6 unemployment rate, which includes these part-timers and marginally attached workers, decreased to 8.3% in September, its lowest level since June 2007.

The number of long-term unemployed (27 weeks or more) fell by only 7,000 from August to 1.73 million on a seasonally adjusted basis. The average duration of unemployment fell by about one week from September 2016 to 26.8 weeks, but was up by more than two weeks from the previous month. The number of multiple jobholders decreased by 487,000 from September 2016 to 7.4 million, and the number of discouraged workers not in the workforce (421,000) decreased by 132,000 from one year ago.

Industry Focus

The not seasonally adjusted unemployment rate for the Mining and Oil & Gas industry fell the most in September from last year, dropping 270 bps, while Leisure & Hospitality fell 150 bps to 5.0%. Professional & Business Services fell 120 bps, while the remaining industry sectors dropped from 10-50 bps with the exception of Other Services (up 50 bps).

  Click to enlarge in new tab.


With the hurricane disruption, modest gains in several industries were overpowered by the huge loss of more than 110,000 jobs in the Leisure & Hospitality industry. Industries with solid positive growth included Education & Health Services (+27,000), Trade, Transportation & Utilities (+26,000), Professional and Business Services (+13,000) and Financial Activities (+10,000). The Information (-9,000), Other Services (-5,000) and Manufacturing (-1,000) industries also recorded net job losses.

  Click to enlarge in new tab.


  • Education & Health Services added 13,900 education jobs and another 13,100 jobs in the health care and social assistance sector. The subsector of child daycare services lost 7,900 jobs in September.
  • Transportation and warehousing added 21,800 jobs, while wholesale trade contributed another 6,700 jobs, but retail trade lost 2,900 jobs. Food and beverage stores (-6,900), general merchandise stores (-2,500) and clothing and accessories stores (-2,500) offset gains in building materials (+5,300), miscellaneous stores (+3,500) and non-store retailers (+2,000) as the hurricanes’ effects rippled through the retail sector.
  • The Professional and Business Services supersector’s job gains were primarily in the high-paying professional and technical services (+11,900) subsector. The administrative and waste services subsector (+5,200) offset losses in management of companies (-4,200).
  • The Financial Activities industry saw a surge in insurance carriers’ jobs (+10,900), which is to be expected after two natural disasters in one month.
  • Nonresidential specialty trade contractors jumped by 8,500 jobs in September, but look for residential specialty trade contractors and residential building workers to see a boost in October as the clean-up and rebuilding efforts swing into gear.
  • Government industry employment added 7,000 jobs, with 5,000 of them at the local level. Another 2,000 state jobs also contributed to the monthly total.
  • Despite the interruption of oil & gas production and refining along the Gulf Coast due to Hurricane Harvey, the Mining & Logging industry still added 2,000 jobs in September.
  • Manufacturing hiring was relatively flat, with nondurable goods manufacturing losses (-5,000) canceling gains in durable goods (+4,000). The food manufacturing nondurable goods subsector still managed to add 4,200 jobs last month.
  • The Other Services industry lost 3,300 jobs in membership associations employment and another 2,800 jobs in repair and maintenance (although this subsector will likely rebound in October).
  • More than half of the Information supersector’s 9,000-job loss in September was from the motion picture and sound recording (-4,600) industry. The other information services (-2,400), publishing (-2,000) and telecommunications (-1,900) subsectors contributed to the loss.
  • Leisure and Hospitality’s 111,000-job loss was almost entirely in the food services and drinking places (-104,500) subsector, with modest losses in the arts, entertainment and recreation sector (-5,900).


California Markets Slide Out of Top 10

Seven of last month’s top 10 job-gain metros returned to the list in August (the latest metro figures available), but a few changed positions and three dropped out of the top 10.

New York, Atlanta and Dallas remained the top three job-gainers in order, among the 120 metros ranked by Axiometrics, a RealPage company.. Washington, DC switched from No. 4 to No. 5 and Boston moved up from No. 6 last month to No. 4. Los Angeles plunged from No. 5 down to No. 11, allowing Houston and Minneapolis-St. Paul to move up one spot each to Nos. 6 and 7, respectively. Seattle, Orlando and Tampa moved into the Nos. 8-10 spots, as Phoenix and Riverside joined Los Angeles in tumbling out of the top 10 list.

Together, the total jobs created in the top 10 metros for the 12 months ending in August were down 10.1% from July’s annual total (629,100 vs. 699,500), but up 8.1% from the 12-month total for August 2016 (629,100 vs. 582,200). A comparison of the top 10 metro job-gainers from July to August revealed a 6.6% decline in annual job gains.

Other major metro movers included:

  • Charlotte improved from No. 20 to No. 15.
  • Las Vegas moved up from No. 23 to No. 14.
  • San Antonio went from No. 37 to No. 23.

In addition to Los Angeles and Riverside, several California metros moved down the list:

  • Anaheim fell from No. 53 to No. 111.
  • Fresno moved from No, 67 to No. 75.
  • Sacramento dipped from No. 39 to No. 41.

In addition, the Midwest metros of Milwaukee, Chicago, Kansas City and Cleveland each fell at least seven spots on the top 120 list.

Annual job growth slowed in four of the top 10 markets in August:

  • Orlando (-85 bps)
  • Tampa (-81 bps)
  • Dallas (-75 bps)
  • Seattle (-70 bps)

Job growth was up in:

  • New York (+1 bps)
  • Atlanta (+4 bps)
  • Washington, DC (+15 bps)
  • Minneapolis (+29 bps)
  • Boston (+48 bps)
  • Houston (+192 bps)

Three of the bottom five returned from last month with even stronger net job losses. Mobile, Akron and Virginia Beach lost an additional 2,500 jobs combined from last month’s annual pace. Milwaukee and Santa Rosa, CA joined the bottom five list in August. Santa Rosa’s losses occurred primarily in the local government educational services (-1,300) and manufacturing (-2,300), while Milwaukee’s losses were spread across several industries: construction (-1,400), retail trade (-1,300), financial activities (-2,200), other services (-1,100) and government (-2,100).

  Click to enlarge in new tab.

Access the current job-growth spreadsheet here.

Please contact us if you have any questions.


Will the Aging Millennial Population Harm the Apartment Market?

The prime renter age group of 20-34 also happens to roughly parallel the age of the millennial generation. Millennials recently passed the baby boomers as the largest generation by population in the U.S. As seen in the population pyramid graphics below, the 20-34-year old population (or prime renter group) comprised 20.8% of the U.S. population in 2017, or about 67.9 million people.

With the prime renter group’s population growing by almost 6.7 million in the past 10 years, it’s easy to understand at least one reason for strong apartment market performance. By comparison, the prime renter group gained 1.5 million people from 1997-2007, but had a slightly lower percentage of the total population (20.4%). Interestingly, 1997’s prime renter share of the population was higher at 22.0%, as it included some members of the baby boomer generation.

  Click to enlarge in new tab.

Looking forward 10 years, U.S. population projections from the Population Division of the United Nations’ Department of Economic and Social Affairs show that the prime renter age group is not expected to change very much from current levels. In fact, there is only a slight decrease of about -32,300, with a decrease in share of total population to 19.4%.

What does this mean for the apartment industry? Should we stop building new apartments if the population in the prime renter age group remains about the same? Of course not. First, there will always be a need to replace a portion of our aging apartment inventory. Natural disasters such as floods, fires, hurricanes, tornadoes and earthquakes will destroy some units, too. But more importantly, at least in the short term, there has been somewhat of a structural shift toward renting in the minds of many.

In addition to the propensity to rent among the prime renter group (which has been pretty consistent over the years), a portion of the population that may have lost homes because of the Great Recession or is renting as a lifestyle choice due to downsizing or urbanization will continue to create demand for more apartments. Coupled with the difficulties facing those wishing to buy a home (of any age group or generation), and the outlook for apartments is generally good for several more years.


By the Numbers

The following table shows August 2017 (the latest data available) metropolitan-area job gain and job growth, some grouped by state or region.

  Click to enlarge in new tab.

Javascript is not enable. This may affect content rendering. You can enabled Javascript in your Settings Menu.