The big job shift that’s shaping the future demand for property

When it comes to the future needs of commercial property it helps to examine which jobs will be required not long from now and how best to accommodate them.

Maintaining an active and independent lifestyle is important to our ageing population.

Our national workforce has always adjusted to demographic, technological and environmental trends. Since 2020, the workforce has been reshaped by the pandemic.

These changes matter deeply to anyone involved in the property sector. Jobs dictate residential settlement patterns, the type and location of commercial property and the ­incomes that flow into everyone’s pockets.

The best jobs data comes from the census. Let’s explore which jobs saw the biggest growth and the biggest ­decline over the last five years. Associated property trends quickly ­become visible.

Many of our growth jobs have ­titles such as manager or officer. These jobs are the result of ever larger organisations and departments. As the complexity of work increases more middle managers are needed to navigate organisational structures and assign tasks. These well-paid jobs usually require university level ­education.

Traditionally these jobs were concentrated in the office towers of our central business districts. Managers and officers were willing to pay a premium for housing close to their office towers to shorten the soul-destroying daily commute. As the pandemic forced all businesses to embrace working from home, many office workers were not willing to pay a premium for housing close to an office they did not use. Much better to move further out and move into a larger or nicer home.

These workers now inject their wealth into the urban fringe. This trend will continue. Expect more manager types to leave the inner city. They will stay roughly within a two-hour commute from the CBD.

Demand for working-near-home commercial property in the urban growth corridors should be high. Co-working spaces should also be in high demand.

The growth in aged or disabled carers has been through the roof. In equal parts driven by the National Disability Insurance Scheme and the ageing of our population, this job grew at three times the rate of the second fastest-growing job. Currently the large baby boomer generation is still too young, too healthy and too agile to ­require care at scale.

In the coming decade, Boomers will need care at scale and the ­demand for care workers will be even higher. Baby Boomers expect that these low-income carers will magically be available. Getting enough carers trained up locally or imported from overseas is a monumental challenge. Making sure they can service the ageing Baby Boomers is even harder. Boomers cluster in the middle suburbs of our large cities where they occupy three and four-bedroom homes as empty-nesters. Baby Boomers appear to prefer ageing in place over moving into an aged-care facility.

Baby Boomers are still relatively fit and active but once they are forced to slow down, aged-case demands will grow.

Where will the aged-care workers servicing them live? So far, the middle suburbs are bastions of NIMBYism. Will Boomers start pushing for affordable medium density housing near their homes?

The worsening skills shortage in the care sector suggests that NIMBYism would further minimise the availability of local care.

Certain functions that took place outside the home in pre-pandemic times were pulled into the home. We now work from home, eat more at home, we shop from home, we might even still exercise at home. These lifestyle changes created a boom in delivery drivers – another low-paid job that we simply take for granted.

Now that we spend longer hours at home, we want bigger homes (especially since the large millennial generation started to have kids and leave their hipster apartments behind).

The sought-after larger homes tend to be found on the urban fringe, since Baby Boomers are not selling their suburban homes until the 2030s when they become a nuisance to manage or even a physical hazard.

Online shopping obviously drives ­demand for more warehouses, too. Is it best to have a few large distribution centres on cheap industrial land on the fringe or do we need more smaller warehouses closer to the population centres?

Other growth jobs are simply linked to the growth of our population. We need storepeople and clerks near where people live. This will further drive the demand for housing and retail offering on the urban fringe.

What do the declining jobs tell us about property?

Receptionists, secretaries, travel consultants, bank workers, data entry operators and office cashiers are all white-collar jobs that have been made redundant by software, apps, electronic payments and websites. How come these workers are not angrily roaming the streets fighting our evil robot overlords? Simple, their jobs were not lost.

Many people engaged in secretarial work transitioned to higher-paid or higher-skilled jobs. Picture: Virginia Young

Rather, most workers transitioned into higher-paid, higher-skilled professions. Your organisation does not employ secretaries any more, it ­employs office managers or executive assistants instead. These job losses ultimately put more money in the pockets of workers. Unfortunately, the rising costs of living (especially housing) gobbled up the increased earnings entirely.

The lack of waiters and cooks – two low-paid hospitality jobs – is a leftover from the pandemic. We simply do not have workers to fill these jobs since they either left the country or took better-paying jobs.

Many of these workers were international students or temporary migrants (usually on a partner or family visa rather than a skilled visa) and occupied small rental accommodation in the inner suburbs. Now that the borders are open again, these workers slowly return and continue to move (initially) into the inner suburbs as renters.

If by now no affordable rentals are available, regions risk missing out on these migrants. There are countless regional tourism hot spots that lost their limited rental stock to the newly arrived working from home crowd and now simply cannot attract low-income workers. The skills shortage and the housing affordability crisis are two interconnected problems.

As we speculate about the future of our workforce, we can draw conclusions about future property needs. Lifestyle destinations will be doing well as the downsizer ­cohort grows and more knowledge workers are enabled to work ­remotely.

The urban fringe will also boom for another decade as Millennials ­advance into the family formation stage. In times of a persistent skills shortage, commercial property follows the workers rather than workers following commercial property. Let workers guide you to lucrative property opportunities.

Simon Kuestenmacher is co-founder and director of research at The Demographics Group