Marcus & Millichap

Healthy Job Growth Will Support Steady Absorption in the Office Sector

August 11, 2017

A total of 209,000 new jobs were created in July, more than the 183,000 jobs expected, the U.S. Bureau of Labor Statistics reported last week, and the national unemployment rate fell to 4.3 percent. The number of employed Americans hit a new high of 146.6 million, causing the employment-to-population ratio to move up to 60.2 percent, the highest level since February 2009.

Continued steady job gains have led to positive performance in the office sector, even though total absorption was 28 million sq. ft. in the first two quarters of the year, down from 38 million sq. ft. during the same period last year, according to Marcus & Millichap data. “This is not a bad number,” says Alan Pontius, San Francisco-based national director of specialty divisions at Marcus & Millichap. “Absorption has slowed, but it is still positive, and construction remains muted.”

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