Reports See Continued Job Growth, Demand for Tech Office Space
"Though economic boosts this week were brought on by strong corporate earnings reports, continued job growth in the high tech sector has been the main catalyst to the resurgence of the U.S. office sector," according to an article by Robert Carr.
The article bases that conclusion on data found in the July Beige Book report by the U.S. Federal Reserve Board, which shows continued payroll growth, and a "Friday Market Insight Report" from Newmark Grubb Knight Frank, which also showed job growth in June moving at "lightning speed."
Carr explores the job data's implications for office real estate, finding an expert willing to argue strongly for the continued growth of the tech industry's influence in the market:
Technology talent is fueling most of the office use growth, says Colin Yasukochi, director of research and analysis for the Northern California region with real estate services firm CBRE. He recently authored the “2016 Scoring Tech Talent” report for the company. High tech companies’ share of major leasing activity increased from 11.0 percent in 2011 to 18.0 percent in 2015 nationwide, he notes—the largest single share of any industry. The number of tech talent workers in the labor force increased 27.0 percent during the past five years, adding more than one million jobs to the national economy, at more than three times the national average for all occupations.
According to Yasukochi, traditional tech cities like San Francisco, Washington, D.C., New York, Seattle, and Austin will continue to lead the country's tech job market, but new arrivals to the scene, like Nashville, Charlotte, Tampa, Seattle, and Phoenix, will also be faced with growing demand for office space.