Recent labor-market data suggest the U.S. economy is continuing to generate output with limited incremental labor input, making productivity an increasingly important macroeconomic factor for commercial real estate investors, according to Ryan Severino, BGO chief economist, in his recent LinkedIn post.
May payroll employment rose by 172,000, while the unemployment rate held at 4.3 percent, but total nonfarm payrolls were only 503,000 above May 2025 levels, or roughly 42,000 jobs per month more than the past year. At the same time, first-quarter nonfarm business output rose 3.2 percent year-over-year, while hours worked increased only 0.4 percent, meaning most output growth came from productivity gains. Severino noted the United States has also maintained a productivity advantage over Europe, with productivity accounting for much of the U.S. real Gross Domestic Product (GDP) growth edge versus
