Despite a slowdown in retail sales and e-commerce growth, transportation, warehousing and utilities jobs remain in high demand, especially in South Florida.

This employment subsector, which tracks distribution and warehouse workers, continues to have above-average job openings nationally, with available jobs remaining almost two times higher than pre-pandemic levels from 2015 to 2019 and well above total job openings for all employment sectors which remain only around 1.4 times higher.

Florida specifically continues to see strong competition for workers as the unemployment rate for the state, 2.9%, remains well below the U.S. average of 3.7% as of the latest figures. South Florida has an even lower unemployment rate of 2.4%, with Miami-Dade driving significant employment gains, with an unemployment rate of 1.6%.

Apart from a tight labor market, South Florida has seen an above-average demand for workers within the transportation, warehousing and utilities sectors since 2020. South Florida’s employment within the sector has risen over 16%, well above the 12% rise across the U.S. Additionally, this has been one of the fastest-growing employment sectors in the South Florida area, which has seen overall employment rise by only 8%, half the growth seen relative to transportation, warehousing and utilities.

Continued demand within the sector is expected going forward as 32 industrial properties with more than 100,000 are under construction in South Florida, with over 20% of space, or around 2 million square feet, already preleased. Additionally, 131 of these properties have opened since 2020, and these are now around 90% leased, adding over 27 million square feet in industrial inventory to the area.

The majority of these large industrial properties, with around 90% composed of distribution or warehouse space, are near each other and in proximity to available pools of blue-collar workers across South Florida.

As new properties continue to be completed, competition for warehouse and transportation workers will continue to heat up, making labor availability an increasingly important factor for site selection, both for investors and tenants. While northern Florida markets like Jacksonville, Tampa and Orlando will continue to see a healthier availability of non-office workers over the next few years, South Florida has mostly tapped into the majority of this labor pool and is seeing an exodus of lower-income workers.

Despite transportation and warehousing workers becoming harder to find, demographic changes in South Florida are set to continue to attract warehousing and distribution businesses. The influx of high net-worth individuals since the pandemic, coupled with the high number and density of high-income households in the region, has made it increasingly attractive for businesses.

Wages for transportation and warehousing employees in Florida are the 17th-lowest relative to all other states and remain below the U.S. average, though these have risen significantly in the past few years, specifically in South Florida. Wages for this sector in Miami-Dade remain 16% higher than the Florida average and have risen over 20% since the end of 2019, relative to a 10% rise on average across Florida.

A tight employment market, coupled with above-average inflation in South Florida, has driven this outperformance in wage growth. Going forward, despite an expected easing in inflation pressures, competition for non-office workers will likely continue to drive wages higher for transportation and warehousing workers. This will make it increasingly important for both tenants and industrial developers to find the correct mix between proximity to blue-collar workers and downstream demand to save on transportation costs.