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The job losses across the hospitality and food service world are spilling over into the real estate and construction industries.
A 50 percent drop in accommodation and food services jobs nationwide in the second quarter of 2020 could translate to 3.1 million job losses in those industries and an additional 1.2 million job losses in the broader economy, according to a new report from the St. Louis Federal Reserve. That could lead to the loss of 33,972 and 22,314 jobs in the real estate and construction industries, respectively.
The study, released April 2, used data from the United States Bureau of Labor Statistics (BLS) to estimate the “spillover” — the impact that events in one sector or industry have on a seemingly unrelated sector or industry. The report did not break down the types of jobs in the real estate and construction sectors that could be impacted.
No. of Job Losses
|Food services and drinking places||2,674,889||21.8|
|Management of companies and enterprises||85,060||3.5|
|Administrative and support services||142,494||1.6|
|Retail, except motor vehicle and parts dealers, food and beverage stores, and general merchandise stores||44,774||0.6|
|Amusement, gambling and recreation industries||52,809||2.9|
However, the real estate industry isn’t immune to direct job losses stemming from the coronavirus pandemic. This month, some of New York City’s biggest brokerages began laying off and furloughing large chunks of their workforce. Redfin, an outlier in the industry for employing salaried brokers, laid off 41 percent of its agents.
Last week’s jobs report from the BLS showed that the real estate rental and leasing workforce shrank by 3.8 percent in March 2020. Overall, the number of coronavirus-related business shutdowns has sent jobless claims skyrocketing, totaling almost 17 million over the past three weeks, according to the U.S. Department of Labor.