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Week Ending April 2, 2022

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Brown's Rants

Job Market Nears Pre-Pandemic Unemployment Levels

The latest unemployment numbers came out last week. The U.S. is now closing in on matching pre-pandemic unemployment levels. March unemployment fell to just 3.6%, with the Bureau of Labor Statistics (BLS) reporting nonfarm payrolls increased by 431,000 in March 2022. The unemployment rate had reached a low of just 3.5% in February 2020 before the pandemic. That said, there are still about 1.6 million fewer people employed than at that time as the overall labor participation rate has fallen from 63.4% in February 2020 to 62.4% last month. That difference, when looking at the overall population, comes out to about 4.6 million workers that dropped off the labor rolls. The good news is that the labor force participation rate has been creeping back up since bottoming out at 60.2% in April 2020. But the degree to which that trend will continue to play out is a big question mark.

First, there was a spike in early retirements at the front end of the pandemic. Research from the Federal Reserve indicates that just over three million American workers in their early 60s opted for early retirement when initial layoffs and furloughs exploded in the wake of lockdowns. What is harder to measure is where the other +/-1.6 million workers went. Many of them landed in the gig economy—one study by JPMorgan Chase indicated that as many as 19% of gig workers were receiving jobless benefits in July 2020. This ended up being the safety net for a lot of impacted workers; DoorDash added nearly two million new drivers during the first 6.5 months of the pandemic (with women accounting for a larger share of those jobs than men). Hiring spiked across all of the food delivery platforms from Instacart to Uber Eats. There is no consistent and reliable data source for how gig economy drivers have returned to the workforce, but one thing is certain. Rising fuel prices and the continued strength of the U.S. job market is likely to lure more of these workers back, but it won’t be enough to deal with existing worker shortages.

Of course, not all employment categories have felt the same impacts. Office-using employment (the financial activities, information, and professional and business services categories) has increased by 698,000 since the pandemic. And, as surprising as it may seem, retail employment has grown (+266,000 jobs) since the start of pandemic as has transportation and warehousing (+579,000 jobs). All other job categories are down from pre-pandemic highs, but most only barely.

The biggest job loss remains concentrated in the leisure and hospitality sector. This category includes hotel, amusement park and restaurant workers. While overall we are down 1.6 million workers from before CoVid-19 lockdowns, employment in these fields has fallen by 1.4 million.

Yet, according to the BLS as of February 2022 (the latest data currently available), there were 1.7 million available leisure and hospitality sector jobs. The challenge is clearly a shortage of workers. Incidentally, though retail employment has grown over pre-pandemic levels, there were 1.1 million available jobs as of the last Job Openings and Labor Turnover (JOLTs) Report. In fact, every category of labor with the sole exception of mining & logging had more currently available jobs than the number of workers displaced by the pandemic. The retail sector had 1.1 million jobs available, while the greatest shortage was for office-using employment. The three categories that define that sector had a combined 2.7 million available jobs.

This, of course, has helped to drive strong wage growth (5.6% year-over-year as of March) and has been a contributing factor to inflation. But the other big economic data release of last week were the inflation numbers. Those jumped 6.4%, meaning that the cost of goods is outpacing increased wages. All of which is starting to impact the retail sector in terms of slower foot traffic. The likelihood is high that when final March 2022 retail sales numbers come out next week that growth, while remaining positive, will show a clear trend of cooling.

In the meantime, current labor conditions could potentially result in the Fed being more aggressive with interest rate hikes to curb inflation. This would slow the economy at a much faster pace, potentially taking inflation down a couple of notches. It also will slow the job market, which at this point, is likely a good thing. Unfortunately, it also will likely slow the record run that retail sales have been enjoying the past 18 months. All of this, of course, assuming that the Fed will be able to walk the fine line between slowing inflation and not crashing the economy.

See you next week.

Garrick

Amazon Warehouse Workers Vote to Unionize
Chain Store Age 4/1

March Unemployment Nears Pre-Pandemic Levels
CNBC 4/1

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Wall Street Journal 3/31

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Forbes 3/31

US Chamber: Retail Theft a National Crisis Congress Must Address
New York Post 3/31

Rising Fuel, Food Prices Contribute to Lower Foot Traffic at Retailers
Winsight Grocery Business 3/30

Private Equity Flood: Car Wash Operators Scour Philly for New Locations
Philadelphia Business Journal 3/30

The Unexpected Unknowns
Robin Report 3/30

Grocery Retailer Expectations for 2022
Supermarket News 3/30

Recession Warning as Yield Curve Inverts
Business Inside 3/29

Economic Headlines stories of the week

Grocery Hiring Accelerated as Unemployment Fell to 3.6% in March
Winsight Grocery Business 4/1

Inflation Jumps 6.4% in February
New York Times 3/31

Gas Prices: Effects on Retailers, Small Businesses and Consumers
ICSC 3/31

Why I Believe a Freight Recession is Imminent
Freightwaves 3/31

The Stock Market Loses its Taste for Fast Food
Restaurant Business 3/31

NYC Consumer Spending Will Increase 20% Over 2019
Globe Street 3/31

Predictions of a Craft Beer Reckoning
Axios Twin Cities 3/30

Investor Interest Soaring for Real Estate
ConnectCRE 3/28

Consumer Spending on In-Person Experiences on the Rise
Chain Store Age 3/28

DoorDash Dominating Restaurant Delivery Industry
Zero Hedge 3/28

US Restaurant Traffic Increased in February
QSRWeb 3/25

Property Trends stories of the week

Detroit’s Corktown Neighborhood Buzzes with Retail Development
Detroit News 4/2

Former Vallco Mall to be Transformed to Housing, Retail, Dining Destination
Chain Store Age 4/1

Deals Yield New Future for Tanforan Mall Redevelopment
San Francisco Business Times 4/1

Great Pandemic Migration Revitalizing Palm Beach Retail
Bloomberg 4/1

Elyria Ohio’s Midway Mall May Find New Life as Health, Wellness and Innovation Park
News5Cleveland.com 4/1

The State of Northern Nevada Retail
Nevada Business 4/1

DFW Population Boom Boosts Retail Real Estate
Dallas Innovates 4/1

Rediscovering Seaport Village: Redevelopment Plan Wins Award
Times of San Diego 3/31

New Mixed-Use Project Coming to Old Town Alexandria VA
Alexandria Living 3/31

Overheard at the Luxury Meets Cannabis Conference:  12 Tips for Retail Success
Forbes 3/31

Hollywood & Highland Complex Renamed Ovation Hollywood
Apparel News 3/31

Retailers Have a Small Window to Renegotiate Their Leases
Globe Street 3/30

PROCON Breaks Ground on Redevelopment of Billerica Mall in Boston Metro
Shopping Center Business 3/29

Cheyenne Barnes & noble to Become Natural Grocers
Oil City 2/29

New Owner of Oakland Mall (Detroit Metro) Wants an ‘Anti-Mall’ With Tik Tok Stars
Detroit Free Press 3/29

Aging Southern California Mall (Laguna Hills Mall) Joins List of Retail Centers Pivoting
Costar 3/29

Placer AI: Malls Again Prove Their Resilience
ConnectCRE 3/28

New Ownership Group Looks to Revamp The Forum Shopping Center in Peachtree Corners GA
Costar 3/28

Nashville Welcomes Wave of New Retailers and Restaurants
Western Real Estate Business 3/28

Starting This Week Mall 205 (Portland, OR Metro) Won’t Be a Mall
Willamette Week 3/27

How Would Students Revitalize a Foundering Mall?
ICSC 3/26

Houston Ranks Third for Population Growth
Costar 3/25

 

Retail Headlines stories of the week

Kohl’s Under Attack
Robin Report 4/1

As Bidders Stalk Kohl’s, JCPenney’s 650 Locations and Customers Deserve Second Look
PYMNTS 4/1

SHOWFIELDS Overhauls NYC NoHo Location
Retail Touchpoints 4/1

Cannabis Dispensaries Open in New Mexico
El Paso Times 4/1

Cannabis Dispensary Likely to Take Former Rainforest Café Spot in Chicago’s River North
Costar 4/1

Herman Miller Adds Two LA Stores
Furniture Today 4/1

New Love’s Travel Stop Taking Shape in Jacksonville
Jacksonville Business Journal 4/1

Burlington Opening in Menifee CA
Press-Enterprise 4/1

Foxtrot Opening Four DC Area C-Stores
Grocery Dive 4/1

QuikTrip Expands to Cleveland OH
Bluebonnet News 4/1

Aaron’s Completes Acquisition of Brandsmart
Chain Store Age 4/1

Weir’s Furniture Store Expands in Dallas
Dallas Morning News 4/1

Fabletics Will Open Second KC Area Store
Kansas City Business Journal 4/1

Hobby Lobby Signs Lease for New Store in The Villages Florida
West Orlando News 3/31

Seven Tenant Updates
ICSC 3/31

How GoPuff Used BevMo’s Stores to Conquer California
Los Angeles Times 3/31

Buff City Soap Adds Dallas and Plano TX Stores
Dallas Morning News 3/31

Faraday Future Opening Electric Car Showroom in Beverly Hills
ConnectCRE 3/31

Foxtrot Markets Expanding, Entering New Markets
Chain Store Age 3/31

Hobby Lobby Expanding in Orlando FL
West Orlando News 3/30

Five Below to Open Up to 400 Stores in Next Two Years
Chain Store Age 3/30

Restoration Hardware Details 2022 Initiatives
Chain Store Age 3/30

Balenciaga Opens in Boston at Copley Square
ConnectCRE 3/30

Costco Coming to Amherst NY
Buffalo Business First 3/30

It’Sugar Opening Chicago Second Downtown Store
Chicago Business Journal 3/30

Hobby Lobby Coming to Staten Island
SI Live 3/30

American Eagle Expands Presence at Pittsburgh’s Ross Park Mall
Pittsburgh Business Times 3/28

Montblanc Spills on its Physical Strategy
Retail Brew 3/29

JD Sports Heading to Arden Fair Mall
Sacramento Business Journal 3/29

Express Opens New Concept at Plaza Frontenac
St. Louis Business Journal 3/29

Batteries Plus Growth Continues Nationwide
Chain Store Age 3/29

Conn’s HomePlus Likely to Open in Santa Fe NM
Santa Fe New Mexican 3/28

Charming Charlie to Close Retail Locations
Community Impact 3/28

Academy Sports to Open 80 to 100 Stores Over Next Five Years
Chain Store Age 3/28

Nike Heads to the Wholesale Exits
Retail Wire 3/28

Orangetheory Fitness Opens First of its Kind Flagship
Chain Store Age 3/28

Meijer Continues Northeast Ohio Expansion with Two New Supercenters
Winsight Grocery Business 3/26

Grocery Headlines stories of the week

Instant Delivery Firm Go Puff Laying Off 3% of Global Workforce
Grocery Dive 4/1

99 Ranch Market Opens First New York Store on Long Island
Newsday 4/1

Amazon Fresh to Open in Chicago Suburb Norridge
Chicago Tribune 4/1

Hy-Vee Expanding Into New Markets
Chain Store Age 4/1

West End Piggly Wiggly Closing
Nashville Scene 4/1

Whole Foods Anchored Apartment Tower in Miami Breaks Ground
South Florida Business Journal 3/31

Food Story Natural Market to End Jersey City Food Desert
Costar 3/31

The Ten Fastest Growing Grocers in 2021 Were…
Chain Store Age 3/31

Bay Area Businesses Left with Unpaid Bills After Ultrafast Delivery Startup Zero Grocery Shuts Down
Perishable News 3/31

Grocery Outlet to Expand in Pittsburgh
Pittsburgh Business Times 3/31

Food Giant to Open in Birmingham AL Food Desert
Winsight Grocery Business 3/31

Natural Grocers to Open in Canon City CO
Winsight Grocery Business 3/31

Littleton’s Market to Open Late 2022 in Columbus OH
Winsight Grocery Business 3/29

Lam’s International Supermarket Expands to West Side of Valley
Phoenix Business Journal 3/29

Hy-Vee Enters Tennessee
Supermarket News 3/29

Dave’s Market Closing in Cleveland Suburb Collinswood
Cleveland.com 3/28

Save Mart Has a New Owner
Winsight Grocery Business 3/28

Save Mart Bought by Private Equity Firm
Grocery Dive 3/28

Whole Foods Joins Other Grocers With Plans for Stores in North Dallas Suburb McKinney
Costar 3/25

Restaurant News stories of the week

Welcome to Panera Bread Next Generation
QSR Magazine 4/2

Neat Burger Gears Up for Growth
QSR Magazine 4/1

I Heart Mac & Cheese Opens First Illinois Unit
FastCasual.com 4/1

Pizza Guys Open in San Carlos CA
QSR Magazine 4/1

Krispy Kreme Lines Up New Orlando Restaurant
Orlando Business Journal 4/1

Starbucks Opens at Reno City Center Project
Reno Gazette Journal 4/1

Crumbl Cookies Rolling into Milpitas CA
What Now San Francisco 4/1

Fazoli’s Expands in North Carolina
RestaurantNews.com 3/31

Whataburger Opening Eight Georgia restaurants
WJCL 3/31

Chick’nCone Looks to Expand in South Carolina
RestaurantNews.com 3/31

Smokey Bones Opens in Avon IN

RestaurantNews.com 3/31

Fajita Pete’s Signs Deal to Open 13 Texas Units
QSR Magazine 3/31

Peach Cobbler Expands to West Virginia
RestaurantNews.com 3/31

Charlie Brown’s Returns to Woodbury NJ

RestaurantNews.com 3/31

Sticks Kebob Shop Rolls Out Franchise Opportunity
QSR Magazine 3/31

Shaq’s Big Chicken Opening in Dayton OH
Dayton Daily News 3/31

Donato’s Plans South Florida Expansion
QSR Magazine 3/31

Asian-Themed Food Hall Coming to Pittsburgh
Pittsburgh Magazine 3/31

JINYA wants fast casual concept bushi by JINYA to Reach 100 Units by 2024
QSR Magazine 3/31

Wagamama Heading to Atlanta
What Now Atlanta 3/31

Super Chix Inks Deal to Open 23 New Jersey Locations
Daily Voice 3/31

Kilwin’s Expands in Chicago Neighborhood of Andersonville
Block Club Chicago 3/31

Dunkin Opens Philadelphia Area’s First Digital Only Store in Cherry Hill
Philly Voice 3/31

Pure Green Expanding in Midwest with Franchises
QSR Magazine 3/31

Paris Banh Mi Opening in Elk Grove CA

Sacramento Business Journal 3/31

Fine Dining Player Maribella Signs One of Manhattan’s Largest Retail Leases of the Year
Costar 3/30

Popeyes Unveils Digital Concept as They Ramp up Growth
QSR Magazine 3/30

Freebirds World Burrito Opening Five More Texas Units
FastCasual.com 3/30

Huey Magoo’s Expands in Alabama
FastCasual.com 3/30

Smoothie King’s Aggressive Growth to Continue
Chain Store Age 3/30

Plano’s Food Hall Company Plots Expansion
Dallas Innovates 3/30

Rush Bowls Takes Aim at 50 Units for 2022
QSR Magazine 3/30

Smashburger Opens Full Bar in Colorado
9News 3/30

The Past Present and Future of Drive Thrus
QSR Magazine 3/29

Clean Juice Doubles Down on Growth
RestaurantNews.com 3/29

The Future of Restaurants May Be Hiding in a Suburban Mall
Restaurant Business 3/29

Waba Grill Continues California Expansion
RestaurantNews.com 3/29

McAlister’s Deli Expands in Georgia
QSR Magazine 3/29

Cookie Concept Last Crumb Takes Former Le Cordon Bleu Space in Pasadena CA
ConnectCRE 3/28

Chicken Salad Chick Adds 30th Florida Store
FastCasual.com 3/28

MOOYAH Headed to Ocala FL
QSR Magazine 3/28

Qdoba Expanding in South Florida
QSR Magazine 3/28

Slim Chickens Opens Second Tuscaloosa Store
RestaurantNews.com 3/28

Pizza Twist Adds 100th Franchisee
RestaurantNews.com 3/28

Sbarro to Expand by 100 Units Globally in 2022
QSRWeb 3/28

Atomic Wings Expands to Arlington TX
FastCasual.com 3/26

Café Rio Opening 15 Locations by Year End
FastCasual.com 3/26

REITs, Landlord & Development stories of the week

CBL Loses Control of Three Malls
Costar 4/1

Latest Open Air Splurge; Inside Edens’ 1 Million Square Foot Acquisition
ICSC 4/1

San Diego Retail Deal Among Latest underscoring Investor Interest in Neighborhood Centers
Costar 4/1

LA Shopping Center Near Beverly Hills is Sold, Mixed-Use Development Planned
Costar 4/1

Seritage Terminates REIT Status, Seeks Conversion to C Corp
ConnectCRE 3/31

Great Floors Sale-Leaseback Spree Tops $32M
Costar 3/31

Nuveen Sells Charleston Plaza Retail Center in Silicon Valley for $71.8M
Shopping Center Business 3/31

San Francisco Investor Drops $72M on Retail Portfolio Purchase
Costar 3/31

Nearly $300M: Shopping Centers in San Jose, Berkeley, Alamo are Bought
SiliconValley.com 3/30

What’s Behind the Surge of REIT Mega Mergers
ICSC 3/30

Publix Anchored Shopping Center in Charlotte Suburb Sells for $28.2M
Costar 3/29

Sterling Organization Buys Chicago Grocery Anchored Plaza North Mayfair Commons for $18.25M
ConnectCRE 3/28

Publix Anchored The Shoppes at Hanfield Village in Charlotte NC Metro Sells for $28.2M
Shopping Center Business 3/28

Costco Anchored Center in Tempe AZ Sells for $27.8M
Shopping Center Business 3/28

ecommerce, omnichannel, retail tech stories of the week

Less Than a Year After IPO Digital Brands Warns it Could go BK
Retail Dive 4/1

Foodland Looks to Automate
Supermarket News 4/1

Sodexho to Open Autonomous Grocery Stores on College Campuses
Winsight Grocery Business 4/1

Retail Set for Social Commerce Boom
Chain Store Age 4/1

How Could Tokenization Reshape Real Estate Investing?
Fast Company 3/31

BJ’s Same Day Delivery Program Gets an Upgrade
Winsight Grocery Business 3/31

Wendy’s Opens in the Metaverse
QSRWeb 3/30

PacSun, Forever 21 Head to the Metaverse
Retail Touchpoints 3/31

Are Brands Entering the Metaverse Headed for the Wild, Wild West?

TotalRetail 3/27

Digital Native Retailers Struggle to Turn Profit
eMarketer 3/25

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