Office Demand Began the Year With an Uneven Picture Amid Growing Labor Market and Economic Uncertainty

NEW YORK--(BUSINESS WIRE)--For the first time in 20 months, demand for office space did not increase year-over-year during the first two months of the year, according to the latest VTS Office Demand Index (VODI) report. However, a surge in March activity reversed January and February’s dip, bringing office demand up 4.6 percent year-over-year by the end of Q1. The slowdown at the start of the quarter reflects growing uncertainty in the economy amid recent tension in global trade. Declining job postings, slower hiring, and broader concerns over unpredictable policy shifts likely played a role. According to the latest data from VTS, national demand for office space now stands at 68 — roughly two-thirds of its pre-pandemic level.

Job postings and hiring continued to soften in Q1, with postings declining steadily across nearly all major sectors over the past two years. The new hire rate — the percentage of employed workers who started their jobs within the past month — has dropped from around 4.5 percent in early-2022 to approximately 3.4 percent as of early-2025, a level not seen since the early-2010s....   ...more

RSK: This could actually be a slight blessing for the office market as the economy softens a bit. Less job openings could mean employers have the upper hand in betting employees back to the office. See next article below.