{"id":1004219961,"date":"2018-04-17T02:32:18","date_gmt":"2018-04-17T10:32:18","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004219961"},"modified":"2022-12-08T03:35:28","modified_gmt":"2022-12-08T11:35:28","slug":"how-will-trade-tension-impact-labor-market-cre","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/how-will-trade-tension-impact-labor-market-cre\/","title":{"rendered":"How Will Trade Tension Impact Labor Market, CRE?"},"content":{"rendered":"<p>By Scott Baltic, Contributing Editor<\/p>\n<div id=\"attachment_1004219970\" style=\"width: 310px\" class=\"wp-caption alignright\"><a href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/04\/Ryan-Severino.jpg\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" aria-describedby=\"caption-attachment-1004219970\" data-attachment-id=\"1004219970\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/how-will-trade-tension-impact-labor-market-cre\/ryan-severino-2\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/04\/Ryan-Severino.jpg\" data-orig-size=\"800,620\" data-comments-opened=\"0\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}\" data-image-title=\"Ryan Severino\" data-image-description=\"\" data-image-caption=\"&lt;p&gt;Ryan Severino&lt;\/p&gt;\n\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/04\/Ryan-Severino.jpg?w=800\" class=\"wp-image-1004219970 size-medium\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/04\/Ryan-Severino.jpg\" alt=\"Ryan Severino\" width=\"300\" height=\"233\" srcset=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/04\/Ryan-Severino.jpg 800w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/04\/Ryan-Severino.jpg?resize=300,233 300w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2018\/04\/Ryan-Severino.jpg?resize=768,595 768w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/a><p id=\"caption-attachment-1004219970\" class=\"wp-caption-text\">Ryan Severino<\/p><\/div>\n<p>Tensions caused by the Trump administration\u2019s proposed tariff increases of 25 percent on up to $50 billion a year of Chinese products are overmatching good news about the economy, according to JLL\u2019s latest Economic Insight commentary, released last week and written by\u00a0Chief Economist Ryan Severino.<\/p>\n<p>After the White House announced plans to boost tariffs on about 1,300 products in the electronics, aerospace and machinery sectors, China threatened to respond in kind, with 25 percent tariffs on about $50 billion worth of U.S. goods. Though the first round of <a href=\"https:\/\/www.commercialsearch.com\/news\/economy-watch-major-retailers-urge-no-new-tariffs-on-chinese-goods\/\">U.S. tariff hikes<\/a> have not gone into effect, President Trump reportedly tasked a U.S. trade representative with assessing a possible additional $100 billion in tariffs on Chinese imports.<\/p>\n<h2>Short-term impact<\/h2>\n<p>The JLL report suggests that if both sides carry out their threats, <em>\u201cthe tariffs could reduce GDP growth in the U.S. by up to 50 basis points over the next 12 to 15 months,\u201d<\/em> offsetting any gains from the late 2017 tax cuts. In the meantime, of course, market volatility has reflected broad concerns over the trade issue.<\/p>\n<p>Though March\u2019s job gains, and negative adjustments to the figures for January and February, weren\u2019t all that had been hoped for, average monthly job growth for the first quarter nonetheless hit 202,000, notably ahead of the 2017 pace. And though unemployment remained 4.1 percent, year-over-year wage growth ticked up slightly.<\/p>\n<p>Interestingly, the report\u2019s author\u00a0had expressed concerns regarding a trade war about 13 months ago, not long after the Trump inauguration, in his predictions for <a href=\"https:\/\/www.commercialsearch.com\/news\/severino-predicts-positive-cre-investment-performance-in-2017\/\">CRE investment performance<\/a> in 2017.<\/p>\n<h2>The effects on CRE<\/h2>\n<p>What this all boils down to for commercial real estate, Severino wrote in the new report, is a <em>\u201cmuddled picture.\u201d\u00a0<\/em>Any fall in imports would directly harm demand for warehouse\/distribution space, especially near major ports. Separately, Severino expects office vacancies to slowly rise over a five-year horizon, with net absorption unable to keep up with supply growth.<\/p>\n<p>The labor market is expected to continue to tighten, leading to an acceleration of wage growth. <em>\u201cWe are paying close attention to the inflation data this week and expect it to accelerate as temporary forces that restrained inflation last year subside,\u201d<\/em> Severino wrote.<\/p>\n<p>If a trade war does arise, we\u2019re likely to be in strange territory, Severino told <em>Commercial Property Executive<\/em>. <em>\u201cWe haven\u2019t seen a trade war in a really long time, so there isn\u2019t likely to be much empirical research on trade wars and CRE.\u201d<\/em><\/p>\n<p>The report is available <a href=\"https:\/\/www.us.jll.com\/united-states\/en-us\/research\/9008\/alls-fair-in-a-trade-war-4-11-18\">here<\/a>.<\/p>\n<p><em>Image courtesy of\u00a0Ryan Severino<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Continued wage gains aren\u2019t enough to balance concerns over a trade war with China that could slow economic growth.<\/p>\n","protected":false},"author":882,"featured_media":1004219970,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21808,23891,21742],"tags":[33049,32796,33556],"class_list":["post-1004219961","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured","category-national","category-latest","tag-donald-trump","tag-jll","tag-ryan-severino"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How Will Trade Tension Impact Labor Market, CRE? 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