Economics & Demographics • Section 3


ployment, housing, consumer spending, and mobility. While the economy’s wow-factor in 2015 was not spectacular, most Americans pre- ferred the year’s performance to the alternative. Positive economic indicators outnumbered the negatives throughout the year indicating that the current growth trend could be sustained for the foreseeable future.


S As the U.S. economy headed into 2016, the


unemployment rate hovered near 5 percent and the labor force was on a pace to add 2.5 million jobs during 2015. Oil prices were on the decline for much of the year while hous- ing maintained a steady comeback. Support- ing the favorable economic climate, consumer confidence increased to a seven-month high as autumn approached.


With economic conditions continuing to improve, self-storage


across the board generally prospered in 2015. The demand for storage is expected to increase in 2016 and beyond as the U.S. population


continues to grow and opportunities expand for employment.


The price of a barrel of oil was cut roughly


in half between September 2014 and Septem- ber 2015, as seen in Chart 3.1. Reaching levels last seen during the depths of the 2009 reces- sion, the national average price for regular gas was approximately $2.65 per gallon, compared with $3.45 a year earlier. A significant drop in oil prices gives consumers extra money to spend on other goods.


Perhaps reflecting uncertainty in the over-


all economy, the Federal Reserve passed on a chance to raise interest rates in September, although many economists expected an in- evitable rate hike by the first quarter of 2016. Contributing to the Fed’s decision to leave rates near zero were the low U.S. inflation rate and continuing economic turmoil around the world.


elf-storage professionals identify numer- ous economic drivers that contribute to demand for storage space, including em-


The stock market finally suffered a correction late in the year following a spec-


tacular, six-year bull market. The self-storage Real Estate Investment Trusts (REITs) once again enjoyed exemplary returns among all REIT sectors as their occupancy rates remained over 90 percent as seen in Table 3.2 on next page.


With economic conditions continuing to improve, self-storage across the


board generally prospered in 2015. The demand for storage is expected to in- crease in 2016 and beyond as the U.S. population continues to grow and oppor- tunities expand for employment.


Promising Signs For Employment The unemployment rate continued to decline in 2015, reaching 5.1 per- cent in August, its lowest point in seven years. That was down by near- ly half since the peak of 10 percent during the Great Recession. Unem- ployment stood at 5.9 percent in September 2014 and 7.2 percent the previous year, according to the U.S. Bureau of Labor Statistics. See Table 3.3 and Chart 3.2 on page 39.


The estimated 2.5 million jobs


created in 2015 fell short of the nearly three million new jobs in 2014, which was America’s best year of job growth since 1999.


From August 2014 to August


2015, hourly earnings increased 2.2 percent over the year, according to the U.S. Bureau of Labor Statistics.


120.00 100.00 100.00 80.00 68.27 60.44 60.00 47.04 40.00 20.00 0.00 Source: InflationData.com 2016 Self-Storage Almanac 37 37.54 30.68 29.92 35.55 58.75 51.62 72.98 77.10 91.37 88.93 92.40 85.24


Table 3.1 – Annual Average Crude Oil Prices 2000 - 2015


Year Inflation Adjusted Price 2000 37.54 2001 30.68 2002 29.92 2003 35.55 2004 47.04 2005 60.44 2006 68.27 2007 72.98 2008 100.00 2009 58.75 2010 77.10 2011 91.37 2012 88.93 2013 92.40 2014 85.24 2015 51.62


Source: InflationData.com Chart 3.1 – Inflation Adjusted Crude Oil Prices 2000-2015


2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015


Inflation Adjusted Price


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