Southern California Real Estate, Construction Jobs Fall

The job market for real estate and construction-related fields is contracting in Southern California.

Employers across real estate services, lending, construction, building supplies and building services tracked 714,900 workers in Los Angeles, Orange, Riverside and San Bernardino Counties last month, according to the Orange County Register’s analysis of California Employment Development Department data.

That’s 24,100 fewer than the same month a year prior. The difference marked a 3 percent drop in headcount. Self-employed workers weren’t counted.

The number of real estate services workers in the region fell 2,900 to 114,500 last month, a 2 percent drop from last year, the analysis found.The lending market lost 2 percent, or 1,900 of its workers, to 83,500 employees.

The tumble started a few years ago, when a hot seller’s market and national housing shortage, coupled with monetary policies favoring real estate, brought the industries to an apex.

Real estate-related industries reached a post-Great Recession high of 761,700 local jobs in July 2022, the analysis found.

Soon after, the market started to shift, with high-interest rates, inflation and the Federal Reserve backing off its pandemic-era easy-money policy and large purchases of mortgage-backed securities.

Since then, jobs are down by 46,800, or 6 percent.

At the same time, demand for local real estate and construction-related jobs, which make up about 9 percent of Southern California’s nearly 8 million workers, fell as higher financing costs have become obstacles for construction, mortgages and the purchase of building materials.

The construction sector, at 359,800 workers, lost 16,400 jobs, or 4 percent, compared to last August. The building supplies sector lost 1,100 workers in a year, or a 2 percent drop to 49,600 workers. Building services jobs fell 1,800, or 2 percent, to 107,500 workers.

Los Angeles County lost 10,100 real estate and construction-related workers over the past year, falling 3 percent to 330,800. Orange County’s real estate and construction sectors lost 5,600 workers for a 3 percent drop to 210,600 employees. In the Inland Empire, consisting of Riverside and San Bernardino Counties, jobs in the sectors fell by 8,400, or 5 percent, to 173,500 workers.

The Federal Reserve made its first rate cut of the year earlier this month and signaled that more are coming down the pike. Lower borrowing costs could subsequently juice up local real estate employment.

— Chris Malone Méndez