From the Economist’s Desk: Q3 2016 Snapshot
What’s happening with San Jose’s economy? Count on our quarterly snapshots to give you the scoop. Take a look at the data for yourself on our economic indicators dashboard.
Strong job growth across multiple sectors
San Jose added a total of 10,370 jobs during 2015, ending December 2015 with 403,200 jobs within city limits, showing healthy growth of 2.6% over the calendar year. Most notably, the Construction sector experienced 12% growth over the year (+2,480 jobs). Other high performing sectors include Information (10.7% growth, +1,200 jobs), Leisure and Hospitality (4.6%, +1,820 jobs) and Professional and Business Services (3.4% growth, +2,390 jobs).
At 4.2%, San Jose’s September 2016 unemployment rate is lower than August’s 4.5%, even as the city’s resident labor force continues to grow. As of September 2016, San Jose was home to 559,600 workers (employed or seeking employment), up 3.8% from a year ago. San Jose’s labor force accounts for a significant 53% of the San Jose metro area labor force.
San Jose’s unemployment rate compares to 3.8% for the San Jose metro area, 5.5% for California and 5.0% for the nation.
Real estate demand remains strong as more space comes online
Citywide, the Q3 2016 office vacancy rate is 9.1%, the same as the previous quarter. More office space is on the way: 185,000 sq.ft. were completed this quarter, and another 1 million sq.ft. are under construction. Major projects include Trammel Crow’s Midpoint @237 and Hunter Storm’s Coleman Highline.
San Jose’s R&D vacancy rate is 11.5%. As a major tech employment center, San Jose has 42 million square feet of R&D space. Another 150,000 sq.ft. were completed this quarter.
High demand for industrial and warehouse space from San Jose’s manufacturing and logistics sectors have resulted in an extremely low vacancy rate of 1.0%. New construction from Panattoni in South San Jose and Trammel Crow’s Midpoint @237 will bring another 680,000 sq.ft. online later this year.
Housing prices steady
The Bay Area’s ever-rising housing prices appear to be steadying. As of September 2016, the median price for a single family home is currently at $851,000, relatively flat from the same time last year. At the close of the second quarter 2016, San Jose apartment rents average $2500 per month, up 0.6% from the same quarter last year. The apartment vacancy rate is 4.3%.
That’s it for this month’s economic snapshot. Follow us at @sjeconomy to stay up to date, and bookmark the indicators dashboard for the latest stats. Next quarter’s post will be coming from a new voice as Michelle Thong will be moving to a new position in San Jose’s Office of Civic Innovation and Digital Strategy.