Hiring Hits Breakout Pace in April as Total Employment Flirts with Pre-Recession Peak

May 6, 2014

  • Job creation accelerated in April, with private-sector industries and government agencies combining to lift payroll gains to their highest monthly level in more than two years. The aggressive pace of hiring signals that economic expansion could accelerate despite the weak initial first quarter GDP reading. The improvement in the labor market also validates the Federal Reserve’s decision this week to reduce its monthly asset purchases by an additional $10 billion, cutting its monthly investments to $40 billion per month — half the levels of last year.

  • Nearly all private-employment sectors expanded in April and government staffing also rose, yielding a total of 288,000 new positions during the month. Professional and business services led the way, creating 75,000 positions, while rising retail spending and new store openings supported an expansion in the retail sector. Warmer weather enabled work on residential and commercial development to gain traction, contributing to a gain of 32,000 jobs in construction trades, while the spring thaw also helped manufacturing add 12,000 workers. Only the information sector, primarily comprising media establishments, shed workers in April.

  • Following steep staff reductions two years ago, job cuts in the government sector continue to ease. Government employers added 15,000 workers last month, as hiring at the state and local level offset a cut in federal payrolls. Job creation is especially strong in local government, where 17,000 new hires were made in April and 68,000 positions were created over the past year. Improving single-family home sales, growth in retail spending, higher hotel occupancy tax collections, and construction of residential and commercial structures helped lift local government budgets and supported the creation of new government positions.

    Following steep staff reductions two years ago, job cuts in the government sector continue to ease. Government employers added 15,000 workers last month, as hiring at the state and local level offset a cut in federal payrolls. Job creation is especially strong in local government, where 17,000 new hires were made in April and 68,000 positions were created over the past year. Improving single-family home sales, growth in retail spending, higher hotel occupancy tax collections, and construction of residential and commercial structures helped lift local government budgets and supported the creation of new government positions.

    Impact on Commercial Real Estate

  • The continued expansion of construction payrolls reflects an increase in multifamily building. Developers brought more than 41,000 rentals online nationwide in the first quarter, which left vacancy unchanged at 5.0 percent. Leasing traffic during the first three months of 2014 may have been adversely affected by bad weather in many parts of the county. This year, the projected completion of 215,000 apartments will further lift construction payrolls but also raise vacancy 20 basis points to 5.2 percent.

  • As a result of the gain in professional and business services workers last month, office-using employment has recovered all of the jobs lost during the recession. Financial services employment, however, remains well below its former peak and the subdued pace of growth is keeping the national office sector from gaining momentum. Other employment sectors with office-using functions, such as education and health services, continue to expand at a healthy clip and will contribute to a 120-basis point plunge in U.S. vacancy this year, to 14.8 percent.

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The information contained herein was obtained from sources deemed reliable. Every effort was made to obtain complete and accurate information; however, no representation, warranty or guarantee to the accuracy, express or implied, is made.

One Comment

  1. Posted September 4, 2014 at 7:23 am | Permalink | Reply

    great insight. Really enjoyed looking over this blog. Keep up the
    good work and to everyone keep on learning!

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