Local Market Monitor (a National REIA preferred vendor) recently released their National Economic Outlook for December, 2017 where they share their thoughts on developments taking place in the U.S. economy.
National Economic Outlook – December 2017
December 27, 2017
By: Ingo WinzerIn previous economic cycles, the performance of the US economy could be measured by the growth or decline in jobs. No more. By measures like corporate profits or GDP, the economy is doing well today, but job growth keeps slowing down. What gives?
In a word, computers. The greater use of computers and information technology keeps displacing workers. This phenomenon isn’t new – computer-controlled machines have been around a long time – but has accelerated with the build-out of the internet. Ironically, one of the strongest effects can be seen in the information sector itself, where jobs are down 2 percent over the past year. We all know that newspapers have been losing jobs, but that now extends to the movie and TV industries and to telecommunications.
It’s difficult to know where this process will end. What will these displaced workers do instead? They can’t all be retrained for high-tech jobs, especially since high-tech jobs themselves will eventually be relentlessly pared down.
In the meantime, the real estate industry is likely to follow the auto industry, where more and more vehicles are leased because fewer customers can afford to buy.
In November, jobs were up 1.4 percent from last year. Jobs were up 1.5 percent in manufacturing,1.8 percent in finance, 2.7 percent in business services, 2 percent in healthcare, and 2.1 percent at restaurants. Jobs in retail and government were flat. The unemployment rate is bumping along at 4.1 percent.
About the Author: Ingo Winzer is President of Local Market Monitor, and has analyzed real estate markets for more than 20 years. His views on real estate markets are often quoted in the national press and in 2005, he warned that many housing markets were dangerously over-priced. Previously, Ingo was a founder and Executive Vice President of First Research, an industry research company that was acquired by Dun and Bradstreet in March 2007. He is a graduate of MIT and holds an MBA in Finance from Boston University. He resides in Cambridge, Massachusetts.
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