BUSINESS ACTIVITY | LABOR MARKET | iNDUSTRY eMPLOYMENT
REAL ESTATE | tOURISM AND TRANSPORTATION | OUTLOOK

BUSINESS ACTIVITY

Consumer spending falters.

• Total sales in the region reached $226.9 billion in 2025, an increase of 2.2% from a year earlier. Although slightly below the rate of inflation over the same period, the growth is consistent with results from the Partnership’s Orlando MSA Business Conditions Survey, which suggested revenue proved volatile but resilient through 2025.
• Widespread economic and political uncertainty appears to be impacting consumer-facing sectors in early 2026, however. Consumer spending declined year-over-year in each of the first two months of 2026 as sales weakened for the first time since the expansion of tariffs in mid-2025.
• The slowdown is consistent with a drop in consumer sentiment in Florida, which declined in both March and April amid conflict in Iran and growing concerns about the national economy. Local business confidence in the national economy also fell during the quarter amid ongoing policy uncertainty.

LABOR MARKET

Labor market remains subdued.

• The region’s labor market has eased considerably in the last year. Unemployment in February reached 4.7%, up from 3.5% a year earlier with approximately 20,000 more residents unemployed than in February 2025.
• An increase in the ratio of unemployed workers to open positions confirms the labor market has become more balanced. There were approximately 1.3 unemployed workers for every job opening in early 2026, up from just 0.3 in mid-2022 and above the current U.S. ratio.. The softening comes as job postings remain resilient but employment flat – raising questions about whether companies are opting not to fill open roles.
• Where hiring is taking place, employers appear to be taking less time to fill vacancies as more candidates hit the market. The median job posting duration in the first quarter dropped to 22 days, down from 29 a year earlier.

INDUSTRY EMPLOYMENT

Job growth slows.

• Late March brought a considerable upward revision to the region’s job growth in 2025. The Orlando MSA added 8,800 jobs in 2025  – 5,100 more than previously estimated – as Florida’s fastest-growing employment center. Job growth slowed from 2024 in all but three of the country’s 30 most populous regions.
• Weaker local job growth has continued into 2026. The region added just 1,500 jobs in the 12 months ending February 2026, a considerable slowdown from both the corresponding period a year earlier (+9,000 jobs) and pre-pandemic trends (+43,000).
• Much of the slowdown can be attributed to job losses in just three sectors: employment services (as companies appear to pull back on temporary labor), construction (which is sensitive to both higher interest rates and uncertainty), and retail (where fragile demand has collided with cost pressures). Companies also report continuing to explore AI-related productivity gains.

REAL ESTATE

Office market posts positive absorption.

• Office vacancy dropped to 16.5% in the first quarter on 131,000 square feet of positive net absorption, driven in part by ThreatLocker occupying 96,000 square feet at 1901 Summit Tower Boulevard in Maitland. Leasing activity fell 14.9% from a year earlier but underlined an ongoing flight to quality and amenity-rich locations, with Class A space attracting 60.7% of total activity and the Central Business District accounting for 32.2% of all new leases.
• Industrial vacancy rose to 8.1% after 1.3 million square feet of largely speculative product was delivered during the quarter. The quarter saw 187,000 square feet of positive absorption but a 70.5% decline in  leasing activity from a year earlier.
• The region’s housing market continues to labor under affordability challenges. Sales fell 2.0% in March from a year earlier after mortgage rates rose back above 6.0%; the median sales price was largely unchanged from a year earlier at $385,000.

TOURISM & TRANSPORTATION

International passenger volume through MCO hits record high.

• Orlando International Airport welcomed 57.7 million total passengers in 2025, a 0.8% increase from 2024 and the second highest volume on record. Orlando International was again Florida’s busiest passenger airport in 2025, edging out Miami by over 2 million passengers.
• Growth in international passengers was the key driver of the increase, driven both by new carriers entering the market (Air France, Iberia) and by existing carriers expanding their international presence. The total volume of international passengers in 2025 rose 8.2% to an all-time high of 8.5 million; domestic passengers declined nominally from 2024 to 49.2 million.
• Area hotels reported a strong first quarter. Year-to-date occupancy through March was 78.4%, 1.3 percentage points higher than during the same period in 2025, while average daily rates were up 4.6%.

OUTLOOK

U.S. growth to prove resilient in 2026.

• U.S. economic growth in 2026 is forecast to moderately surpass the 2.1% recorded in 2025 as increased business investment offsets a projected slowdown in consumer spending.
• Conflict in Iran is expected to result in households spending more on both gas and food, reducing discretionary purchases and slowing overall consumption. However, business investment is anticipated to accelerate as companies continue to prioritize high-tech and AI-related investment spending to realize productivity gains.
• For the first time in several years, economic growth in Florida could ease to a similar pace as the nation as the state confronts several headwinds – weaker job growth, housing market challenges, and slowing migration that has constrained population growth.