SelectLeaders/Cornell Annual Job Barometer Released
Do Looming Debt Maturities in Commercial Real Estate Portend that the Worst is Yet to Come for the Job Market?
The 3rd Annual SelectLeaders/Cornell Job Barometer Report exhibits a steep decline in commercial real estate hiring activity in 2009 from a year ago, and the question remains will September 2009 stand as a historical low point, or do troubling concerns ahead, including the looming debt maturities in commercial real estate, portend continued weakness?
“Many are pessimistic about the job outlook for real estate given concerns in commercial real estate, implying that the worst may be yet to come,” notes Dr. David Funk, director of the Cornell Program in Real Estate, which conducted the study, adding, “but the 2009 Job Barometer indicates that the bottom may have hit in 2009 and that the lag effect will be shortened due to an extensive and prolonged shedding of real estate jobs.”
The SelectLeaders/Cornell Job Barometer assesses commercial real estate job opportunities on an on-going basis and issues an annual report each January. Now in its third year of publication, it is a research project conducted by faculty, staff, and graduate students in the Cornell Program in Real Estate. The team includes Sung Won Suh, Teaching Associate and research supervisor of the project, and Program graduate students Richard Weidel III, Writer; Sam Bechthold, Research Specialist; and Yingying Zhu, Research Specialist, with faculty oversight from Dr. Funk. Analyzing over 3,500 online job postings on seven primary job boards during 2009, the Job Barometer research team is in a unique position of being able to provide a true snapshot of commercial real estate job supply in the U.S. and to identify trends and opportunities for job seekers.
September 2009 was the low point in commercial real estate opportunities since the inception of the Job Barometer, and not a single month of job activity in 2009 bested the worse month in 2008. From the peak in June 2007, to the low in September 2009, there has been a decline of 83% in the number of commercial real estate job opportunities. There were 40% more commercial real estate job postings in October 2009 than there were in September 2009, however, and evidence that a slight recovery has begun. Nonetheless, the volume of maturing commercial mortgages will be highest during 2010 and 2011, and the ability of borrowers/lenders to make it through that time period is one variable that is substantially affecting the real estate job market. This uncertainty is a cause for employers to delay hiring new employees until they see how the loan maturities play out.
What does this imply for the commercial real estate job market? Anthony LoPinto, Founder of SelectLeaders, a leading real estate job site network, anticipates that there should be growing job opportunities in work outs, acquisitions of distressed assets, and asset management, although it may take 12, even 24 months, for those positions to materialize. If you follow the opportunities, a job seeker would orient their resume towards asset management and property management experience, which a reader of the SelectLeaders/Cornell Job Barometer will know.
Selected findings from the Job Barometer report include:
• Largest decline in job postings: Colorado (-58%), Washington (-51%), and Massachusetts (-49%)
• Leading state for job opportunities: California held it’s number one position, yet the total number of jobs in this state were down -46% from 2008
• Sectors with the highest number of job postings: Multi-Family (35%) led the way, followed by Multi-Sector (20%), again indicating employers were seeking broader experience, and Banking (15%) was third
• Only sector that increased: Property Management experienced a 44% increase from 2008 as owners seek talent that can maximize their assets
• Development job opportunities decreased a corresponding 42%.
• Salaries for graduates of Real Estate program decreased 4.3%, from $97,242 to $93,069 in 2009.
What did we learn from 2009? As 2010 unfolds, unemployment stands at 10% while the underemployment rate—which includes part- time workers who’d prefer a full-time position and people who want work but have given up looking – now is 17.3%. The share of the population in the labor force – 64.6%—fell to the lowest level in 24 years. The ominous clouds of concern noted last year for the commercial real estate job market turned into an all out-storm in 2009, and outpaced the overall job market in terms of decline. There was not a single month during 2009 where job opportunities exceeded the lowest month in 2008. The high point of during 2008 of 1081 professional, commercial job opportunities posted in June had fallen to a mere 254 in September 2009, representing a 77% fall peak to trough in roughly a one year time frame. Perhaps more telling, 2008 saw an average of 760 commercial real estate job postings per month while that number had fallen to an average of just 420 per month in 2009, or an average fall of 44%. In the midst of this job decline you will find in this report that job seekers remain resilient as over 74,000 individual resumes were submitted via the SelectLeaders Job Network in 2009, which is the same number as the previous year yet chasing far fewer jobs. As Darwin would conclude, “Only the adaptable survive.” This report finds Commercial Real Estate professionals adapting and surviving in 2010.
For detailed results and additional information on survey methodology, please visit www.selectleaders.com.
About SelectLeaders Job Network
SelectLeaders is the number one real estate job site network for professionals. Members of the Professional Association partners in the SelectLeaders Job Network control or direct 90% of US real estate and include: Building Owners & Managers Association (BOMA), Certified Commercial Investment Member Institute (CCIM), Commercial Mortgage Securities Association (CMBS), Commercial Real Estate Women Network (CREW Network), Corporate Real Estate Global Network (CoreNet Global), National Association of Industrial & Office Properties (NAIOP), National Association of Real Estate Investment Managers (NAREIM),National Association of Real Estate Investment Trusts (NAREIT), National Multi Housing Council (NMHC), Pension Real Estate Association (PREA), Society of Industrial and Office Realtors (SIOR), and Urban Land Institute (ULI), plus the industry news site, GlobeSt.com. For more information, please visit www.SelectLeaders.com.
About The Cornell Program in Real Estate
Cornell offers a comprehensive, two-year professional degree in Real Estate. Students at Cornell benefit from an encompassing core curriculum combined with a rich, diverse selection of real estate electives allowing for niche specialization—all in close interaction with the largest on-campus real estate faculty in the country. Cornell is also home to the Cornell Real Estate Council, an extensive network of industry leaders, the Cornell Real Estate Review, conferences, research and industry news, and more. For information on the Cornell Program in Real Estate, please visit http://www.realestate.cornell.edu