Q2 2012 Charlotte, North Carolina Commercial Real Estate Economy

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Q2 2012 Charlotte, North Carolina Commercial Real Estate Economy

As 2012 progresses, Charlotte is finding itself on an even keel with respect to employment. The Democratic National Convention was held here in early September, giving the region a much-needed boost in the form of economic activity, if not in actual jobs. “Hotel guests in Cabarrus, Gaston and Union counties included delegates, support personnel, security people and media, with some spending money at local restaurants and businesses,” reported the Charlotte Observer. Gaston tourism officials estimated the DNC generated $3 million to $5 million for the county. Some DNC visitors stuck around almost two weeks. The 85-room Hampton Inn in Belmont hosted journalists with the Washington-based National Journal, along with homeland security staff and other convention-related personnel, the Observer reported.

The latest Current Employment Survey (CES) data from the Bureau of Labor Statistics were compiled before the convention took place and therefore do not measure its impact on the local job scene, but show a generally positive trend. Total non-farm employment grew by 10,800 jobs (1.3%) from June 2011 to June 2012. Total private employment grew by 12,000 jobs (1.7%). Since 2011 was marked by poor employment numbers low economic growth, these gains are welcome indeed. However, no one thinks Charlotte is free and clear of economic problems, and in fact the region’s (and North Carolina’s) economic standing has become a major issue in the gubernatorial election. “Is N.C. Still a Dixie Dynamo?” asked the Charlotte Observer in July in an article about the upcoming race. Former Charlotte Mayor and Republican Candidate Pat McCrory and Democratic nominee Lt. Gov. Walter Denton are each proposing ways to keep North Carolina from “losing it competitive edge.” Charlotte is already known as a major banking headquarters; given that five of the nations’ top 25 banks operate there. According to CES data, Financial Activities employment increased by 1,800 jobs (2.5%) in the 12 months ending in June 2012. Professional and Business Services employment increased by 3,600 jobs (2.6%). The substantially government-funded Education and Health Services sector saw employment increase by 2,000 jobs (2.4%). This figure is notable in that education spending, an area in which North Carolina prides itself, is another key issue in the Governor’s race mentioned earlier.

For the more blue-collar employment sectors, there was some good news. Construction and related trades saw an increase of 900 jobs (2.4%), not a large gain but good for a sector that has seen actual losses. Manufacturing, another area that has seen difficulty, saw employment increase by 1,200 (1.8%). Wholesale Trade, a relatively small portion of employment here, grew by 3,900 jobs (8.9%) while Retail Trade, considerably larger, grew by 800 jobs (0.9%). It should be noted that the Leisure and Hospitality sector, where the benefits of the Democratic convention would be seen, actually posted a loss of 4,100 jobs (4.4%).

Individual sector losses aside, Charlotte seems poised to finish off 2012 in better shape than many of its municipal peers. According to a July report released by the U.S Conference of Mayors and reported by the Charlotte Observer, “the Charlotte area’s economy will grow faster than that of most other metropolitan regions as its recovery continues.” “Gross metropolitan product in the Charlotte-Gastonia-Rock Hill region is expected to grow 2.9% this year, up from 2.8% in 2011,” according to the report from research firm IHS Global Insight, prepared for the U.S. Conference of Mayors.