Click to enlarge.
The line in black shows the money spent on office construction per month adjusted for inflation (October 2012 dollars, in billions). If one adds up all the monthly data and adjusts for inflation, there has been $588 billion spent on office construction since the year 2000.
The line in blue shows nonfarm payrolls. There have been 2.97 million employees added since 2000.
Since 2000, $198,000 has been spent on office construction per nonfarm payroll job added.
$588,000 million / 2.97 million = $198,000
Using hindsight, does that appear to be money well spent?
On the one hand, not every payroll employee added actually works in an office. On the other hand, not every office building that existed in 2000 still exists today. Sigh.
Is it really any wonder that office construction has been in a downward trend for the last decade or so? When job growth began to fail, so too the need to build new offices.
Source Data:
St. Louis Fed: Custom Chart
October 8, 2012
ReplyDeleteFactory space scarce, but region has glut of vacant office space
Nationally, 15.7 percent of office space was vacant in the second quarter.
Count me amongst the officeless employees. Does that mean I should ask my employer for a voucher when I upgrade my living room with a three-seat leather couch plus recliner and ottoman?
ReplyDeleteMy favorite vacant office space story is that of Mesa Petroleum. Mesa's boss, T. Boone Pickens, was upset over a recent local newspaper story which portrayed his company in a negative light. Pickens then allegedly threatened to move the company from Amarillo to Dallas if the newspaper's editor did not take care of the problem. The story goes that Pickens eventually made good on his promise. It was said that for decades there were entire vacant office buildings in downtown Amarillo.
Luke Smith,
ReplyDeleteThe perfect officeless office should have a hammock stretched between two palm trees within a fax machine's throw of the ocean in my opinion. Don't settle for less! ;)
T. Boone Pickens never struck me as a guy who would offer empty ultimatums. On some level I can appreciate that.
"If they don't like it they can leave" was heard multiple times at the company I once worked at. By the end, there was nobody left (many quit + many rounds of layoffs).