US Job Growth Rate Projected To Slow Down This Decade, But Healthcare Sector Will Flourish

The rate of job growth in the U.S. will slow down over the next decade compared to the 2010s partly due to an aging population.

The U.S. Bureau of Labor Statistics, or BLS, reported in a projection on Tuesday that it expects overall employment to grow from 162.8 million to 168.8 million between 2019 and 2029 – an annual growth rate of 0.4%. That figure is far slower than the annual growth rate of 1.3% recorded between 2009 and 2019 – a period that included an historic recovery from the Great Recession.

BLS expected that the healthcare and social assistance sector will add the most new jobs – noting that five of the 20 fastest growing occupations are related to healthcare. The Department cited “increased demand to care for the aging baby-boom population, longer life expectancies, and continued growth in the number of patients with chronic conditions” for the anticipated growth in health care jobs.

Technological advancements, BLS said, are expected to support “rapid employment growth” in professional, business, and scientific services sectors, including computer systems design and related services as well as management, scientific, and technical consulting services.

On the other hand, the manufacturing industry is projected to lose 444,800 jobs over the decade, the most losses of any sector. BLS partly attributed this expected loss of manufacturing jobs to the “adoption of new productivity-enhancing technologies, such as robotics and international competition.”

Also, the retail sector is projected to lose 368,300 jobs over the decade as e-commerce continues to grow in popularity.

Automation and e-commerce are also expected to lead to job losses among office and administrative support occupations as well as sales.

Over the next decade, the total labor force is expected to increase from 163.5 million in 2019 to 171.5 million in 2029. But the labor participation rate is projected to slip from 63.1% in 2019 to 61.2% in 2029, due to the “aging of the baby-boom generation, a continuation of the declining trend in men's participation, and a slight decline in women's participation.”

BLS pointed out that by 2029, all baby boomers will be at least 65 years old.

“The increasing share of people age 65 years and older contributes to slower projected growth in the labor force, as well as a continued decline in the labor force participation rate, since older people are less likely to participate in the labor force,” BLS explained.

BLS also said it projected that the annual growth rate in real gross domestic product will slow down to 1.8% from 2019 to 2029 – down from 2.3% in the prior decade.

On the brighter side, productivity is expected to climb at an annual rate of 1.8% from 2019 to 2029 – well above the 1.1% annual growth recorded from 2009 to 2019. BLS based this projection on the “outlook for business investment and efficiency gains anticipated in the use of labor and capital inputs.”

But BLS cautioned that its projections for the coming decade do not include impacts of the COVID-19 pandemic and response efforts. The figures released in the report were finalized in the spring of 2020 when “there was still significant uncertainty about the duration and impacts of the pandemic.”

The department warned that the virus may cause “new structural changes to the economy” and would be accounted for in its future employment projections.

Last month, BLS reported that the U.S. added 1.8 million jobs in July, well below the 4.8 million jobs added in June.