Los Angeles’s strong job market sweeps away excess office space
Over the last 10 years, the Los Angeles economy has grown from $0.7 trillion to $1.0 trillion, a 41.6 percent increase.
January 22, 2020
- Over the last 10 years, the Los Angeles economy has grown from $0.7 trillion to $1.0 trillion, a 41.6 percent increase. Unemployment has decreased from 11.6 percent to 4.2 percent. Over the same time frame, the Los Angeles economy has produced over 174,300 new office using jobs.
- Not surprisingly, the new influx of employees has required companies to acquire more space to accommodate their growing work force. Net absorption in 2019 hit over 3.5 million square feet, a new peak in the current cycle, while office using employment also achieved a new record at 1.2 million workers.
- Although the Los Angeles economy is highly diversified, 36 percent of office leasing in 2019 was driven by technology, media and entertainment companies, which continue their dramatic expansion in the market to gain access to a talented labor pool.
- Based on current demand, we expect job growth to remain robust and office vacancy to decease. Large commitments signed by Google and Netflix in projects currently under development are expected to result in the creation of thousands of new professional high-paying jobs.
Source: JLL Research, Bureau of Labor Statistic and fred.stlouisfed.org