Logistics and Manufacturing Drive Southeast Industrial Surge

Population Growth Fuels Industrial Expansion

The Southeast’s booming population has driven a surge in industrial demand, with key markets attracting e-commerce, logistics, and manufacturing companies. According to Cushman & Wakefield’s Southeast regional industrial labor report, the region’s 17 major metro areas now have 44.9 million residents, a figure expected to rise 4% over the next five years—nearly twice the national average.

This rapid growth has spurred industrial absorption, with 545.1 MSF of space occupied since 2019, according to GlobeSt. While demand normalized in 2024, with 50 MSF net occupancy gains, developers built nearly 695 MSF of industrial space to accommodate shifting consumer and business needs. However, construction starts have slowed since peaking in 2023, which should help stabilize the market in the coming year.

Labor Market Trends and Industrial Growth

The Southeast benefits from a deeper blue-collar labor pool than the national average, supporting its expanding industrial sector. Over the next five years, warehouse and production jobs are projected to grow by 3.2% and 2.2%, respectively, outpacing national trends.

Since 2020, 650K workers in Southeast metros have transitioned into transportation and warehouse jobs, with Atlanta, South Florida, Tampa, and Orlando each seeing over 50K job switches. At the same time, the region’s manufacturing workforce has expanded by 700K workers, largely due to new facilities coming online—especially in Atlanta, a key manufacturing hub.

Potential Challenges: Immigration Policies and Tariffs

While the industrial market remains strong, policy changes could create headwinds. According to Cushman & Wakefield, 18.1% of warehouse material mover jobs in the Southeast are held by undocumented workers, and any crackdowns on immigration could tighten labor availability. Florida, in particular, has a high share of undocumented workers (7.5%), ranking third in the nation.

Tariffs also pose a potential risk to industrial growth, as sustained trade restrictions could slow manufacturing and retail demand, increase costs for construction materials, and disrupt supply chains. However, reshoring manufacturing operations in response to tariffs could boost certain industrial markets and create new job opportunities in manufacturing and distribution.

What’s Next?

With continued population growth, job shifts, and industrial expansion, the Southeast remains a top destination for occupiers and investors. However, policy changes and economic shifts could shape future demand, making labor availability, infrastructure, and trade policies key factors to watch in the coming years.