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    Economic Insights

    Economic Insights covers topics that may ultimately have an impact on commercial real estate conditions including the labor market, population trends, monetary policy announcements from the Federal Reserve and national budgetary issues.

    Featured report

    Office Employment Softens, but that Won’t Dissuade the Fed from a March Hike

    March 10, 2017

    Janet Yellen’s comments early in March had suggested that a 25 bps increase in the Fed Funds rate to 0.75% - 1.00% was all but certain next week, and today’s report will do little to dissuade the Committee that the labor market has strengthened sufficiently to remove further policy accommodation.

     

    Research search results: 41 found

     
    December Office Employment: Lackluster, With a Chance of Rising Wages

    December Office Employment: Lackluster, With a Chance of Rising Wages

    January 06, 2017

    December’s nonfarm payroll report missed expectations, even as wage growth rose by the fastest pace since 2009. Total nonfarm jobs rose by just 156,000 versus consensus for a gain of 175,000 jobs, while job growth in the private sector rose by a smaller 144,000. On the year, private sector employment grew by an average of 180,000 jobs per month—well off the 229,000 monthly average observed in 2015. 

     
     
     
    “Operating Under a Cloud of Uncertainty”

    “Operating Under a Cloud of Uncertainty”

    December 14, 2016

    As expected, the FOMC raised rates by 25 bps today, bringing the target range to 50-75 bps. What was surprising: Despite virtually no changes to the participants’ economic forecasts for GDP and inflation and the continued use of the word “gradual” to describe the pace of monetary policy adjustment, a third rate hike was penciled in for 2017.

     
     
     
    What to Expect From the Fed Tomorrow

    What to Expect From the Fed Tomorrow

    December 13, 2016

    If the year’s political events should teach us one thing, it’s that no result is ever 100% certain. However, financial markets seem to have forgotten this lesson and are pricing in an increase in the Federal Reserve’s benchmark rate with complete certainty. Recall that it’s been a full year since the Fed last increased the fed funds target to 25-50 bps; a rate increase tomorrow would take the overnight interbank lending rate higher by 25 bps to 50-75 bps.

     
     
     
    November Office Employment: Labor Market Tightens

    November Office Employment: Labor Market Tightens

    December 02, 2016

    November’s nonfarm payroll report, which modestly missed expectations, showed a few surprises. Total nonfarm jobs rose by 178,000 versus consensus for a gain of 180,000 jobs, but job growth in the private sector fell a little short, rising by 156,000. Over the past three months, private non-farm payroll growth has slowed to an average of 165,000 (September – November) versus the prior three months’ average of 197,000 (June – August.) Revisions to the prior two months reduced private employment gains by 17,000 on a combined basis.

     
     
     
    Commercial Real Estate Activity: Mixed

    Commercial Real Estate Activity: Mixed

    November 30, 2016

    The Beige Book report for November, which summarizes comments received from businesses and other contacts outside the Federal Reserve, suggested that economic activity during the most recent period “continued to expand” with most districts noting “modest” or “moderate” growth. 

     
     
     
    September Office Employment: Nothing Here to Alter the Fed View

    September Office Employment: Nothing Here to Alter the Fed View

    October 11, 2016

    September’s nonfarm payroll report, while modestly below expectations, was in line with data from recent months. Total nonfarm jobs rose by 156,000 versus a consensus for a gain of 172,000 jobs. Excluding government workers, payrolls rose by 167,000. Revisions to the prior two months reduced employment gains in July and August by 7,000 on a combined basis.

     
     
     
    The FOMC Holds Rates “For the Time Being”

    The FOMC Holds Rates “For the Time Being”

    September 21, 2016

    The Federal Open Market Committee voted to hold the target range for the Federal Funds rate at 0.25% to 0.50%, although three dissenters voiced support for a rate hike today. In a dovish statement, while the Committee judged that “the case for an increase in the federal funds rates [had] strengthened” and that “near-term risks to the economic outlook appear roughly balanced,” the Committee ultimately “decided…to wait for the further evidence of continued progress toward its objectives.”

     
     
     
    August Office Employment Softens; Fed Move Still Possible

    August Office Employment Softens; Fed Move Still Possible

    September 02, 2016

    August’s nonfarm payroll report was somewhat soft, with the headline figure showing a gain of 151,000 jobs versus consensus for an increase of 180,000 jobs. Excluding government workers, payrolls rose by 126,000. The change in total nonfarm payroll employment for June was revised down from +292,000 to +271,000, while the change for July was revised up from +255,000 to +275,000; on balance, employment gains in June and July combined were 1,000 less than previously reported.

     
     
     
    July Office Employment Rebounds; Gains Should Make for September Move

    July Office Employment Rebounds; Gains Should Make for September Move

    August 05, 2016

    July’s nonfarm payroll report exceeded expectations, handily topping estimates with a gain of 255,000 jobs overall and 217,000 jobs in the private sector. Office employment rose by a robust 88,000 as well (Table 1 and Chart 1 on the following page), led by strength in professional and business services, where almost 1/3 of the advance stemmed from job gains in accounting and bookkeeping services, architectural and engineering services and computer systems design. At least for now, recent data suggest the labor market is firing on all cylinders: the average monthly gain in office-using payrolls over June and July equals 99,000—more than twice as much as the 42,500 average monthly gain over April and May. 

     
     
     
    Commercial Real Estate Activity: “Stable to Improving”

    Commercial Real Estate Activity: “Stable to Improving”

    July 13, 2016

    The Beige Book report for July, which summarizes comments received from businesses and other contacts outside the Federal Reserve, suggested that economic growth during the most recent period was “modest.” However, unlike prior months, no District described growth as slowing or flat. Just two Districts noted any impact from the Brexit vote; Boston suggested that while Brexit presented downside risks to aggregate economic growth, those with direct exposure “did not expect severe negative impacts on their own firms' outcomes” while Dallas noted as with the upcoming presidential election, Brexit served as a source of overall uncertainty.

     
     
     

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    Heidi Learner

    Chief Economist

    +1 212 326 8648

    +1 212 326 8648