Thread by @nickgerli1

Uh-oh. Layoffs are starting to show up in the jobs data.

Specifically in the South.

New payroll data from ADP shows states across the South (TX, FL, TN) have LOST JOBS to start 2023.

Meanwhile coasts are still adding jobs.

Just a blip? or start of a trend? 🤔

#recession

1) I wonder if this is the first evidence of a "reversion" away from the pandemic Sun Belt boom.

Perhaps remote workers are getting called back into office. Or laid off. And need to move back to coasts.

If that is happening, big problem for real estate in South...

2) Because there is just SO MUCH home building.🏠🚧

US Census shows roughly 800k homes actively under construction in South in early 2023.

That's almost 2x West Coast. and it's almost 4x Midwest/Northeast.

3) Based on those home building figures...even a "slowdown" in job growth would be a big problem for real estate in states like Texas/Florida.

But outright job losses, like what's occurred in 2023 so far?

That would be devastating to real estate in South.

4) Here's the jobs data in more granular detail from ADP.

One curious thing to me is the job growth on the Pacific Coast to start 2023.

I was NOT expecting that given all the tech layoffs the last six months.

5) One reason states like CA, and NY in mid-Atlantic, could still be "adding jobs" is that they lost more jobs in the pandemic.

So there's more jobs to "add back".

Whereas the South didn't take the same pandemic hit. So there's more "excess jobs" there and thus they're first… twitter.com/i/web/status/1…

6) Again - still early on this data. Only 2-3 months worth.

But concerning for the South. Since there's really no margin for error in their Housing Market given how much building is occurring.

If you want to track this jobs data for yourself, go here:
adpemploymentreport.com