Southern California Real Estate Employment Slows Down as Interest Rates Rise

Construction workers at Nova Power Bank in Menifee are facing a slowdown in hiring as high interest rates impact construction plans and home sales in Southern California. According to recent data, property-linked employment in Los Angeles, Orange, Riverside, and San Bernardino counties was only up by 2,200 jobs in March 2024, which is 36% slower than the seasonal norm.

The real estate industry has seen a significant decrease in hiring, with only 7,400 positions added in the last 12 months compared to an average of 13,800 jobs per year since 2010. This represents a 46% decrease in the hiring pace for 2024. Additionally, current real estate staffing is 26,800 jobs below the most recent employment peak set in July 2022.

Real estate employment accounts for 9.5% of local employment in March 2024, with the industry’s hiring equaling 11% of all new local jobs since the end of the Great Recession in 2010. In comparison, non-real estate jobs in Southern California were up by 25,600 in March, with a 1% gain over the last 12 months.

Key real estate-related employment niches in Southern California, such as trade construction specialists, building, civil construction, lending, real estate services, building supplies, and building services, have all seen fluctuations in employment numbers. Despite some sectors experiencing slight gains, overall hiring in the real estate industry has slowed down significantly.

Geographically, Los Angeles County, Orange County, and the Inland Empire have all seen changes in real estate employment numbers, with each area facing its own challenges in the current market. As the industry continues to navigate the impact of high interest rates and slower construction plans, construction workers at Nova Power Bank and other projects in Southern California are bracing for a challenging period ahead.