As many cities across the country are experiencing a sharp rise in rental prices and a decline in homeownership, the topic of real estate is a popular one amongst young people, financial analysists, economists, and more. But what about the people who are employed by the industry? Do real estate brokers, agents, and others benefit from the higher commission or get hurt by dropping numbers?
To get more insight into this, LeadMD recently conducted a study analyzing employment numbers and the average salary of industries across America. Of the 50 cities included, the real estate industry made a statement in most of them.
According to their study, the real estate industry showed a decline in cumulative payroll in 49 out of the 50 cities from 2013 to 2017. The cumulative payroll is calculated by multiplying the average salary of real estate workers by the number of people employed in real estate. With data from both 2017 and 2013, they were able to calculate the growth (or decline) of industries.
The Cities with the Most Decline in Cumulative Payroll
While most cities’ real estate payrolls are declining, which ones are getting hit the worst? Hartford, Connecticut shows the largest decline since 2013, as the payroll has declined over 80%. Columbus, Milwaukee, Jacksonville, and Louisville all follow Hartford, and each has a decline of at least 70%.
The Cities with the Least Decline in Cumulative Payroll
Out of the 50 cities, only one had a positive growth — even though it isn’t much growth. The cumulative payroll of Las Vegas’ real estate industry has grown just 5% from 2013 to 2017. According to their research, this is mainly due to the increase in average salary for Las Vegas real estate workers, even with a decline in the number of people employed.
Besides Las Vegas, a few cities have had little decline compared to that of cities like Hartford, Columbus, and more. Riverside, Austin, San Jose, and San Diego are within the five cities with the smallest decline, despite their decline reaching up to 12%.
While it’s good that salaries are increasing, the industry may be becoming harder to enter as a real estate professional with the number of people employed decreasing across the country. Hopefully, this doesn’t make any negative impacts on homeownership and rentals — however, as the growing issue of Millennials’ inability to afford homes and rent becomes more concerning, it’s hard to rule out any factor.