As can be seen in the chart above of the unemployment rate in Miami-Dade for the year ending September 1, 2020, the unemployment rate as of September 1 went back up to 13.0%, not so far from its peak of 14.5% reached two months prior. This followed a welcome decline in the month between to 8.0%, the lowest since March 2020, that now seems to have been a statistical head fake given the benefit of hindsight.
Unemployment levels have remained elevated since COVID-19 reeared its head in March. In the months prior to this, the unemployment rate was two-ish in general, registering a tight 1.5% in February 2020. The effects of COVID-19 on employment and the economy in the Miami area and around the country continue.
Higher unemployment rates can have negative effects on commercial real estate, increasing vacancy rates and decreasing rent growth. Offsetting this is the associated low cost of money, and perhaps the prospect of inflation in the near future due to the ballooning of money supply with efforts to mitigate the effects of the coronavirus. On a good note, as we experience new surges in infections, we seem to be figuring out how to navigate them better, thus presumably future effects will at least be less pronounced. Even more positively, it is looking like a vaccine will be available within months.
Here’s hoping.