u.s. employment update and outlook: january 2015

U.S. employment situation: September 2013

Release date: October 22, 2013

Consistent monthly gains bring

annual job creation to 3.0 million

U.S. employment situation: December 2014 January 9, 2015

December 2014 employment summary

• After a phenomenal November, the U.S. labor market reverted back to its 2014 rate of

growth and added 252,000 net new jobs. As a result, 2014 overall saw 3.0 million new jobs

and every month except January posted more than 200,000 new jobs.

• Unemployment dropped by 20 basis points to a recovery low of 5.6 percent. This decline has

been bolstered by consistent job growth and labor force participation falling to a record low of

62.7 percent.

- Total unemployment declined to 11.2 percent, also a drop of 20 basis points, as the

number of marginally detached workers slowly falls.

- Unemployment for college and high-school grads both dropped as well (to 2.9 and 5.3

percent, respectively), but labor force participation for both groups is at record lows with

little sign of increase.

• Like total non-farm employment, the office-using industries reverted back to normal levels of

growth in December, adding 64,000 jobs over the course of the month.

- Due to strong performance in education, health, leisure and construction, the office-using

industries contributed only 25.4 percent of December’s job creation. Source: JLL Research, Bureau of Labor Statistics

December 2014 employment summary

• Consumer confidence is back up, hitting 91.6 points on the back of sustained employment

increases throughout the year. This has had a positive effect on other indicators: personal

consumption expenditures surpassed $12.0 trillion during the third quarter and are on track

for another record three months.

• Texas, the Sunbelt and the West Coast continue to lead job growth: Austin, Dallas, Houston,

Miami, Raleigh-Durham, San Francisco, Seattle and Silicon Valley, among other markets, all

posted in excess of 3.0 percent year-on-year job creation.

• Improvements in the labor market have finally had a significant effect on the office sector.

Over the course of 2014, occupancy growth has surpassed 54.7 million square feet (highest

in more than five years), pushing vacancy to 15.6 percent and placing upward pressure on

rents across markets.

Source: JLL Research, Bureau of Labor Statistics

December saw 252,000 net new jobs, bringing gains over the

course of the year to 3.0 million 22

0,00

0

121,

000

120,

000

360,

000

226,

000

243,

000

96,0

00

110,

000

88,0

00

106,

000

122,

000

221,

000

183,

000

164,

000 19

6,00

0

360,

000

226,

000

243,

000

96,0

00

110,

000

88,0

00

160,

000

150,

000

161,

000

225,

000

203,

000

214,

000

197,

000

280,

000

141,

000

203,

000

199,

000

201,

000

149,

000

202,

000

164,

000

237,

000 27

4,00

0

84,0

00

144,

000

222,

000

201,

000

304,

000

202,

000

267,

000

243,

000

203,

000

271,

000

261,

000

353,

000

252,

000

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

Oct

-10

Dec

-11

Feb

-11

Apr

-11

Jun-

11

Aug

-11

Oct

-11

Dec

-11

Feb

-12

Apr

-12

Jun-

12

Aug

-12

Oct

-12

Dec

-12

Feb

-13

Apr

-13

Jun-

13

Aug

-13

Oct

-13

Dec

-13

Feb

-14

Apr

-14

Jun-

14

Aug

-14

Oct

-14

Dec

-14

1-m

onth

net

cha

nge


4

Consistent employment growth and upward revisions in

previous months pushed unemployment down to 5.6 percent

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

-1,000.0

-800.0

-600.0

-400.0

-200.0

0.0

200.0

400.0

600.0

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Une

mpl

oym

ent r

ate

(%)

1-m

onth

net

cha

nge

(tho

usan

ds)

Monthly employment change Unemployment rate


5

Job openings are up consistently in recent months, settling at

4.8 million and currently at their highest level in 13 years


6

0

1,000

2,000

3,000

4,000

5,000

6,000

Job

open

ings

(th

ousa

nds)

1.8

1.9

2.0

2.0

2.0

3.1

4.0

7.7

10.0

10.0

12.0

13.0

14.7

17.0

36.0

43.7

48.0

48.0

52.0

0 10 20 30 40 50 60

Motor vehicles and parts

Utilities

Mining and logging

Information

Other services

Transportation and warehousing

Nondurable goods

Retail trade

Wholesale trade

Financial activities

Government

Durable goods

Temporary help services

Manufacturing

Leisure and hospitality

Health care and social assistance

Construction

Education and health services

Professional and business services

1-month net change (thousands)

All subsectors registered growth over the month, with

construction, in particular, making significant headways


7

PBS

Education and health

Construction

All other subsectors

Top three

subsectors

responsible for

58.7 percent of

monthly

growth.

6.9

10.0

15.0

45.5

49.0

58.0

91.0

110.7

121.0

139.3

176.0

186.0

216.6

249.6

290.0

421.0

426.0

482.0

732.0

0 200 400 600 800

Utilities

Nondurable goods

Information

Motor vehicles and parts

Mining and logging

Other services

Government

Wholesale trade


Transportation and warehousing

Durable goods

Manufacturing

Temporary help services

Retail trade

Construction


Health care and social assistance

Education and health services

Professional and business services

12-month net change (thousands)

PBS

Education and health


Retail trade

Manufacturing


All other jobs

Over the course of 2014, PBS, education, health, leisure,

hospitality and construction were the leaders in job creation


8

Core subsectors added 74.2 percent

of all jobs over the past 12 months.

-1,000

-800

-600

-400

-200

0

200

400

2008 2009 2010 2011 2012 2013 2014

Change in '000s jobs

Boosts in state and local government hiring are slowly pushing

up public sector two-year growth figures

Private sector hiring up 5.2

million since December 2012

Public sector hiring up 57,000

workers since December 2012


9

0

2

4

6

8

10

12

Une

mpl

oym

ent (

%)

Bachelor's degree and higher High school graduates, no college

White-collar unemployment dips to a mere 2.9 percent, while

high-school-graduate unemployment falls to 5.3 percent

2.9%

5.3%


10

Labor force participation in both segments has remained

largely flat and at record lows


11

54.0%

55.0%

56.0%

57.0%

58.0%

59.0%

60.0%

61.0%

62.0%

63.0%

64.0%

70.0%

71.0%

72.0%

73.0%

74.0%

75.0%

76.0%

77.0%

78.0%

79.0%

80.0%

2007 2008 2009 2010 2011 2012 2013 2014

Hig

h sc

hool

gra

duat

e la

bor

forc

e pa

rtic

ipat

ion

rate

(%

)

Col

lege

gra

duat

e la

bor

forc

e pa

rtic

ipat

ion

rate

(%

)

Bachelor's degree High school, no college

Goods-producing job growth increased by 90.1 percent in 2014

compared to 2013

-1,000.0

-800.0

-600.0

-400.0

-200.0

0.0

200.0

400.0

600.0

2008 2009 2010 2011 2012 2013 2014

1-m

onth

net

cha

nge

(tho

usan

ds)

Goods-producing Service-providing


12

Energy slows, but office-using growth rises to 3.0 percent on the

back of improved performance

-11.0

-9.0

-7.0

-5.0

-3.0

-1.0

1.0

3.0

5.0

7.0

2008 2009 2010 2011 2012 2013 2014

High-tech Energy, Mining, and Utilities Office-using industries Total non-farm

Source: JLL Research, Moody’s. Note: Due to data lags, high-tech employment only available through November 2014.

13

12-m

onth

% c

hang

e (jo

bs)

Tech still leading; energy demonstrating first signs of decline in

response to falling prices Year-on-year percent employment growth


14

Heading into 2015, initial unemployment insurance claims

remain steadfastly below 300,000 per week

Source: JLL Research, U.S. Department of Labor

15

200,000

250,000

300,000

350,000

400,000

450,000

500,000

550,000

600,000

650,000

700,000

Cla

ims

Initial claims 4-week moving average

0%

2%

4%

6%

8%

10%

12%

0

10

20

30

40

50

60

70

80

90

100

2008 2009 2010 2011 2012 2013 2014

Une

mpl

oym

ent r

ate

(%)

Con

sum

er c

onfid

ence

inde

x

Consumer confidence index

Unemployment rate

Falling unemployment is helping to boost consumer confidence

(91.6 points), resulting in greater retail spending and output

Source: JLL Research, Conference Board, Bureau of Labor Statistics

16

Quits are slowly rising as worker sentiment about the job

market bounces back, while hires are also on the up


17

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Qui

ts (

thou

sand

s)

Quits Hires

Texas, Sunbelt and West Coast markets continue to post fastest

job growth, led by Houston


18

Miami

3.5%

San

Francisco

3.5%

Silicon Valley

3.6%

Raleigh-

Durham

3.2%

Seattle-

Bellevue

3.2%

Houston

4.3%

Dallas

3.6%

Austin

3.4%

Some East Coast and Midwestern markets are still posting

job growth below 1.0 percent year-on-year, however

19


Washington,

DC

0.6%

Pittsburgh

0.9%

Westchester

County

0.2%

Philadelphia

0.3%

Kansas City

0.7%

New Jersey

0.4%

Chicago

0.9%

Detroit

0.9%

The labor force participation rate stayed flat recovery low of

62.7 percent, contributing to declines in unemployment


20

60.0%

61.0%

62.0%

63.0%

64.0%

65.0%

66.0%

67.0%

2008 2009 2010 2011 2012 2013 2014

Labo

r fo

rce

part

icip

atio

n ra

te (

%)

As with the official unemployment rate, total unemployment

dropped by 20 basis points; currently stands at 11.2 percent

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

Total unemployment U-6 10-year average


21

Strong performance in construction, education, health and leisure

pushed down office-using industries’ share of monthly growth


22

After November’s sharp uptick in additions, job growth in the

office-using industries reverted back to normal in December

-300

-250

-200

-150

-100

-50

0

50

100

150

2009 2010 2011 2012 2013 2014

Information Professional and business services Financial activities

PBS represented 78.2 percent of office jobs lost in February 2010.

In December 2014, it represented 81.2 of monthly growth.


23

Slower monthly growth in temporary help services keeps

subsector below 3.0 million jobs

1,000.0

1,500.0

2,000.0

2,500.0

3,000.0

3,500.0

-100.0

-80.0

-60.0

-40.0

-20.0

0.0

20.0

40.0

60.0

80.0

2009 2010 2011 2012 2013 2014

Mon

thly

net

cha

nge

in jo

bs (

ths)

Temporary employment monthly net change Temporary employment

Temporary em

ployment (ths)


24

Utilities, mining and logging and information continue to top

weekly earnings in the private sector

$1,509.71

$1,374.39

$1,253.41

$1,160.15 $1,095.81

$1,059.57 $1,057.10 $1,021.31

$896.17

$813.90

$702.46

$536.76

$370.30

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

Ave

rage

wee

kly

earn

ings


Both overall and PBS wages have grown at a largely steady

rate; uptick in hiring could result in faster wage growth

$700

$750

$800

$850

$900

$950

$1,000

$1,050

$1,100

2007 2008 2009 2010 2011 2012 2013 2014

Ave

rage

wee

kly

earn

ings

Total non-farm PBS

©2014 JLL Research IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.

For more information, please contact:

Ben Breslau

Managing Director - Americas Research

[email protected]

John Sikaitis

Managing Director - Office and Local Markets Research

[email protected]

Phil Ryan

Research Analyst

[email protected]

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u.s. employment update and outlook: january 2015

Economy & Finance

percent year

consistent employment

consistent job growth

labor market

employment situation

bureau of labor statistics

year job creation

net new jobs