This report can/should be used not only for general market orientation/understanding but as a macro overview of economic/market events from both national and regional perspectives.
The nation has created 12.07 million jobs since May, recouping over half (54%) of March and April’s losses. Employers added 638,000 workers in October and above most economic forecasts of 530,000. The nation remains 10.09 million shy of its February level. With the recent spike in COVID cases and the increasing possibility of additional lockdowns could potentially slow job gains.
From Elliott D. Pollack:
So, again, ignore the news about the poor economy over the next couple of quarters. It is unavoidable and transitory. Focus on the period that will follow. Indeed, nationally we have already recovered almost 55% of the jobs lost due to government mandated shutdowns. In Arizona, we have recovered almost two-thirds of those jobs. And that has occurred even though hotel occupancy is down 21.6% from a year ago, air travel is down 54.3%, trips to retail and recreation is down 18.6%, and seated diners are down 34.4% over the last year. Keep in mind that virtually all of those indicators will return or exceed February levels very quickly once vaccinations are available for enough Americans.
In that regard, while priorities might change, it is presently expected that the vaccines will be given to the following groups in the following order:
1. 21 million health care workers
2. 87 million essential workers
3. 100 million adults with high risk medical conditions
4. 53 million others who are 65 and older
5. 69 million covering everyone else
From Eric Peters (CEO/CIO, One River Asset Management):
Early in recessions, the end is nowhere in sight. Fear overwhelms hope, darkness dominates. Asset prices race ahead, which means they lead the economy lower. But they also begin their recovery even as the data appears bleak. As equities climb back to ebullience, fear slowly fades that the recovery will somehow falter. At some point, that wall is scaled, and without the promise of greater heights, something far below grabs our attention. We are drawn to those things we turn our attention toward. And at some point, we tumble, again and again…..The pandemic will end this spring, the wall scaled. In the interim, we’ll endure another catastrophe of the kind that 8mths ago sparked global depression. But those unknowns have faded. Now markets look across the chasm. On the other side, we see ongoing stimulus that is unprecedented in modern economic history, post-pandemic euphoria, yet society terribly fractured. How these things intersect in a vaccinated world are the new unknowns. Though it remains too early to tell whether they are things we see near the top of the wall or far below.
Austin has retained its #1 best performing market title, contracting only 1.9% over the year
Salt Lake City #2 (same in September)
Dallas #3 (same in September)
Phoenix #5 (from #4 in September)
Fort Worth #8 (from #14 in September)
San Antonio (not shown) #11 (from #8 in September)
Houston (not shown) #17 (from #15 in September)
While Phoenix moved to #5 in the Top 10 Metros, its 1.8% m/m job growth, or 38,300, was the highest percentage increase in the Sunbelt. Phoenix’s nonfarm payroll jobs total as of October 2020 is 2,164,800. In February, before the impacts from COVID-19, Phoenix had an estimated 2,231,400 jobs (69,300 jobs or 3.2% above the same month of 2019). Combining job losses for March and April, Phoenix lost 214,400 jobs. Growth since then has brought back 147,800 of those jobs or 69% recoupment (4th highest in the Sunbelt). If the current recovery holds, employment normalization should be achieved by end of Q1 2021.
Top Phoenix Job/News Announcements:
Phoenix Special Callout:
(h/t to Nicholas Gerli, CEO – Reventure)
This point is illustrated in the graph below, which compares ZIP-code level rent growth in Phoenix to some other popular investment markets. Note how the “weakest” ZIPs in Phoenix (the dots furthest to the left) outperform the best ZIPs in Austin, Chicago, Denver, and DC. This means you could have invested in the worst location in Phoenix five years ago and still experienced more rent growth than the best locations in these other markets. This is a testament to the unique combination of pro-business policies, inward migration, and limited supply growth Phoenix has experienced over the last half-decade.
The Houston-The Woodlands-Sugar Land MSA added 19,400 jobs added over-the-month. Combining job losses for March and April, Houston lost 350,200 jobs. Growth since May has brought back 164,500 of those jobs or 47% recoupment.
Top Houston Job/News Announcements:
The Dallas-Plano-Irving Metropolitan Division had the largest monthly employment increase among metro areas with 22,400 jobs added. The area gained 182,700 positions since April. The Fort Worth-Arlington MD added 18,700 jobs in October and the area added 82,900 since April. Combining job losses for March and April, DFW lost 381,700 jobs. Growth since May has brought back 260,100 of those jobs or 68% recoupment (5th highest in the Sunbelt).
Top DFW Job/News Announcements:
The San Antonio-New Braunfels MSA added 8,500 positions for a 0.8 percent increase in October. Combining job losses for March and April, San Antonio lost 117,600 jobs. Growth from May thru October has brought back 75,100 of those jobs or 64% recoupment (6thhighest in the Sunbelt).
Top San Antonio Job/News Announcements:
Austin’s nonfarm payroll jobs total as of September is 1,090,300. In February, before the impacts from COVID-19, Austin had an estimated 1,137,900 jobs (38,000 jobs or 3.5% above the same month of 2019—an average trajectory for Austin in recent years). Combining job losses for March and April, Austin lost 128,600 jobs. Growth since then has brought back 100,300 of those jobs or 78% recoupment (2nd highest in the Sunbelt).
Top Austin Job/News Announcements:
Salt Lake City
Salt Lake’s nonfarm payroll jobs total as of October is 751,800. Combining job losses for March and April, Salt Lake lost 66,700 jobs. Growth from May has brought back 57,000 of those jobs or 85% recoupment which is the highest recoupment rate in the Sunbelt.
Top Salt Lake City Job/News Announcements