Let’s shift gears once again in today’s Daily Data Discussion and take a look at markets around the country with the highest percentage of employees working in service sector jobs.  As many investors also do, we often think of these core market employees as “the butcher, the baker, and the candlestick maker”.

Why the interest in service sector jobs?  These employees are of interest both to multifamily as well as buy and hold single family emerging market investors, as these hard working folks have historically been strong tenants over the decades. 

Many of these employees are employed in stable positions, earning consistent wages but without the purchasing power to buy their own home.  With credit constraints what they are today, it will be even more difficult for many if not most service sector workers to purchase homes in the foreseeable future. 

We spoke several days ago about a rule of thumb for manufacturing jobs; another rule of thumb we’ve used in the multifamily world (as do many) is that a market should have at least 40% of its total employment in the service sectors.  With the massive paradigm shifts in today’s economic world occurring at breakneck speed, that rule of thumb value will probably revise downward a bit.  We’re looking at some correlations now that we will report probably in the second quarter of 2009. 

Here are the markets in our database as of today in terms with the highest percentage of their total workforce employed in the service sectors; data listed represents a 6-month rolling average of employment figures reported by the BLS. 
 
1.  Midland, TX   56.5%
2.  Houston, TX   55.9%
3.  Odessa, TX   53.9%
4.  Sarasota, FL  51.6%
5.  Idaho Falls, ID  50.8%

Database Average:  40.2%
Database Median:  40.9%

Monday we’ll take a look at the markets around the country with the lowest percentages of service job employment.  Have a great weekend.

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