The Bureau of Labor Statistics recently announced that total non-farm payrolls fell by 92,000 jobs this past February. The press release noted a drop in health care jobs in that month as well. But it also reported that the health care sector had added an average of 36,000 jobs per month in the past year.
Comparison with other sectors
In our FRED graph above, we plot the annual percentage changes in total non-farm, health care, government, and manufacturing payrolls. In December 2021, annual increases in health care payrolls slowed to about 0.23 percent. Since then, demand for health care workers has grown, with annual percentage changes outpacing that of total non-farm, manufacturing, and government sectors since December 2022. Despite a cooling labor market overall, annual increases in payrolls are still positive for the health care sector, standing at 2.02% in February, compared with -1% and -0.77% for the government and manufacturing sectors, respectively.
The health care labor market and the recent jobs report
In February, health care worker strikes led to a significant cut in health care employment: -28,000 jobs. But the demand for health care workers is still propped up by an aging population, a trend that isn’t going anywhere. As seen in our FRED graph, the health care industry has become a primary driver of labor market growth. This trend is positive given the slowing labor market and the recent increase in unemployment to 4.4%. But an overreliance on the healthcare sector to boost job growth could become a growing concern.
How this graph was created: Search FRED for and select “All Employees, Health Care.” Click on the “Edit Graph” button and change units to “Percent Change from Year Ago.” Click on the “Edit Graph” button and select the “Add Line” tab to search for and add “All Employees, Total Nonfarm.” Also change these units to “Percent Change from Year Ago.” Repeat for the government and manufacturing series. Click the 5-year option for the date span.
Suggested by Anna Cole and Michael McCracken.