Job growth in commercial real estate has reached a seven-year high in Southern California, though finance lending employment has experienced a slight decrease. This occurred during a year of high interest rates and general distress in several of the area’s property markets. The increase may have been helped by significant construction projects throughout the area and employment increases across all industries.
According to the Los Angeles Daily News, which cited data from California’s Employment Development Department, commercial real estate jobs have increased by 3.1 percent over the year. This data, which includes Los Angeles, Orange, Riverside, and San Bernardino counties, shows a 12-month gain of roughly 24 thousand positions. The new total of real estate positions in these areas has reached nearly 804 thousand. It is the largest increase in real estate employment since 2017.
In the same area, jobs in all other industries experienced a 2 percent increase over the last year, increasing by roughly 141 thousand to a total of 7.4 million.
Real estate jobs saw an even greater increase in the Inland Empire. Over the previous year, real estate jobs here increased by 4.9 percent, representing a gain of around nine thousand for a total of roughly 190 thousand. LA County increased by 2.9 percent (10 thousand gained for a total of 379 thousand), and Orange County by 2.1 percent (5 thousand gained for a total of 233 thousand). Real estate jobs now make up 11.1 percent of the workforce in the Inland Empire, 8 percent in Los Angeles County, and 13.4 percent in Orange County.
Some specialties experienced much greater growth than others. Most likely due to the surge of large infrastructure construction projects in the area, as well as a great deal of commercial development, the employment of trade construction specialists increased by 5.6 percent. This added 14 thousand new jobs for a total of 265 thousand. Similarly, employment in civil construction increased by 4.2% percent (5 thousand new jobs for a total of 144 thousand) and building services increased by an impressive 5.9 percent (6,400 for a total of 265 thousand).
Meanwhile, employment in lending and building supplies dropped slightly, though only by just over one percent at worst. Employment in real estate services dropped by a mere 0.1 percent, largely holding stable at around 144 thousand jobs in the noted counties.
The Southern California construction boom is driven largely by residential projects, which began to surge near the end of the pandemic and immediately after. There is also an effort in Los Angeles to add a significant number of residential units—more than 400 thousand, roughly a third of which are set to be affordable housing projects—to the downtown area. This is one of many similar plans taking place throughout LA, which projects that 20 percent of the city’s housing growth will take place in an area representing only around one percent of the city’s land area.
Southern California is also one of the primary sites for a nationwide boom in new apartment construction which is expected to continue until the end of 2025. After that point, experts project the boom in apartments will dwindle, though Los Angeles County’s many developmental plans will continue.