Trends to know for 2022

FMI Consulting presented live (yes live, not online!!!) @ the Association of Industrial Real Estate Brokers (aire-brokers.org) luncheon this week in Chicago.

Some interesting takeaways and data points:

Trends to watch in 2022,  it’s all interconnected:

Oil prices are rising

• We are trending toward an inverted yield curve; the inversion point when short term yields are greater than long term yields. Early sign of Recession?
• Russia and Ukraine impact: flaming inflation, supply chain snarls, building material challenges, higher fuel, copper and aluminum costs
• Oil Prices are moving up rapidly, currently at a 9-year high. Will it settle?
• Inflation is at a 40-year high.
• New home sales have cooled off.
• Consumer Confidence is decreasing, that results in less spending.
• COVID’s lingering effects:
  • Lockdown promotes move to online shopping.
  • Cargo ships sitting at ports for weeks.
  • Workers out sick or limited due to quarantine.

A quick recap of Q4 2021:

• 6.9% GDP growth, massive. Up 11.7% since January 2020.
• Unemployment continued to drop.

Expect labor uncertainty

Opportunities:

• The labor force participation continues be low, currently at 62.2%.
• Washington’s Infrastructure Investment and Jobs Act, getting the money out to projects.
• Supply Chain efficiency.

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