Commercial real estate hiring remains steady and just off all-time highs, yet the composition of jobs is undergoing a subtle evolution while the shrinking pool of job seekers is driving new, sometimes desperate recruiting strategies, according to our latest SelectLeaders Job Barometer.
Commercial real estate job postings through Q3 2018 are up 11 percent over the SelectLeaders Job Barometer index and have now exceeded the long-term average for five consecutive years, reinforcing an employer sentiment of cautious optimism in the commercial real estate market. Commercial real estate jobs hit their peak in the first quarter of 2015 and outpaced the change in overall jobs, but over the past two years have lagged slightly behind U.S. job growth.
Jobs like those in acquisitions and development tend to wane when commercial real estate heads into a correction, but are remaining as vital areas of hiring activity with 9 percent and 8 percent of all job postings, respectively. “The hiring in development and acquisitions is remarkable given how long we’ve been at this stage in the cycle,” said David Funk, managing editor of the Job Barometer. Jobs in finance and investment continue as the most common opportunities followed by portfolio, asset and property management jobs.
California and New York are the top two destinations for commercial real estate jobs, with New York having the largest increase in opportunities in 2018 Q3. Other states in the top 10 are Texas; Florida; Illinois; Georgia; Massachusetts; Washington, D.C.; Pennsylvania; and Colorado.
“Overall U.S. unemployment stands at 3.7 percent, while commercial real estate is nearing a decade of positive hiring and with new entrants to the industry relatively static the talent pool is getting strained,” Funk said. The supply of professionals to the real estate industry is relatively inelastic, and the challenges real estate employers are feeling in hiring and retaining talent is borne out by the data that shows low applicant to job ratios and a resounding seller’s market.
The result is that real estate job seekers today are the most selective, or pickiest, since the Job Barometer began tracking candidates’ behavior. This year job seekers are clicking on almost 58 job opportunities for each application submitted, double the number just two years earlier. The last time the industry witnessed a similar level of reluctance to apply to an opportunity was 2006-2007, but back then employers started to offer equity to lower and lower levels of applicants to seal the deal. This economy is different, and employers are not that quick to compromise. They seem reluctant to hire relocations, and often take a longer and longer time to hire.
This is part one of a two-part series on the SelectLeaders Job Barometer. Part two will address innovations in proptech and its impact on careers in real estate. The SelectLeaders Job Barometer, published since 2006, is the foremost survey of employment opportunities, trends, and hiring practices in the commercial real estate industry.
Susan M. Phillips is the CEO of SelectLeaders, LLC, which powers the career centers for 12 premier real estate industry associations (whose members control or direct 90 percent of commercial real estate) and offers unequalled access to the real estate community.