Labor Data: Atlanta Labor Market Trends Downward
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Twenty-six companies are headquartered in the metro area from the Fortune 1000, 16 of which are ranked in the elite Fortune 500. Due to the organizational diversity and headquarters of these known companies, the long-term outlook for the metro area remains bright. However, optimism should be balanced with caution.
Given the low reported job gains and tepid wage increases, there does not appear to be a significant labor supply shortage for skilled jobs. Coupled with housing permits on the increase, unless jobs are added at an accelerated rate, home prices could begin seeing a deceleration due to over-supply.
During June 2019, the Atlanta metro area gained approximately 6,400 jobs for an annual growth rate of 1.9 percent. The metro area unemployment rate remains low at 3.3 percent during May 2019. Compared to the five-year history, the job growth in the metro area decelerated by about 90 basis points. During optimal economic conditions, the metro area can produce 90,000 to 100,000 jobs annually with 10-year historical average job gain standing close to 67,000 jobs.
"Atlanta-Sandy Springs-Marietta employers have reported a stronger hiring pace compared to Q2 2018." said Carmen Seda, a spokesperson for Manpower.
• Despite low unemployment rate, the metro area wage growth remains tepid at 1.7 percent, pointing to why we are seeing lower than expected job growth numbers
• Professional and Business Service industry leads the share of jobs in the metro area alongside Trade, Transportation and Utilities.
• Tech jobs, which falls under Professional and Business Services, is still growing compared to last year, beating five-year annual average growth rates.
• Among white-collar jobs, the Healthcare industry is seeing robust job growth.
• Among the blue-collar jobs, Leisure and Hospitality as well as Construction industries are contributing to job growth in the area, but the pace of growth has slowed compared to the last five years.
Atlanta’s single and multi-family ratios remain near equilibrium. Home prices are growing at a higher pace at 6 percent annual rate as of the first quarter of 2019, according to the National Association of Realtors (NAR) and apartment rents are not showing signs of slow down, supply will continue.
Since early 2019, the pace of total permits increased in the metro area, so developers and investors should exhibit caution as demand will start to slow unless substantial increases occur in job growth to help absorb new units.
Gain more insight into employment statistics, including job growth and hot and cold employment sectors, with ThinkWhy's Major Market Activity Report for June 2019.