A Look at National Employment Projections For 2020-2030


By Michael Jeanfreau, Regional Economist

Across the nation, 2021 has largely been a year of recovery, with many industries experiencing growth back toward their pre-pandemic numbers. As we try to find a new normal¹ amidst ongoing pandemic concerns, there’s a general recognition that a few things may have permanently altered. For example, our way of interacting with the job market has been disrupted. Teleworking has become prevalent, increasing the demand for groceries and their delivery, and savings rates increased.² How does this new demand affect our expectations for jobs going forward?

Not a lot, answered the Bureau of Labor Statistics in their recently released national 2020-2030 employment projections.³ They predict an increase of 153.5 million to 165.4 million jobs across this current decade. The pandemic’s effects and associated recession caused the base year employment in 2020 to abnormally shrink. That one year of employment dropped noticeably below the prior trend. This is unfortunate, as it will make the starting employment level out of sync with the normal trend.

Employment projections are largely an extension of the recent ongoing trend. The ten years of employment projections are built from trends leading up to 2020. In these current projections, the one-year anomaly drop in 2020 will artificially lower the projection’s starting point below the normal trend. This will in turn make the growth percentages between the end point and the starting point artificially higher than if 2020 was just another normal trend year.

In general, even dramatic impacts on the economy like COVID-19 only accelerate internal structural change. In other words, the pandemic and other large events force people to make adjustments that they might already make, only faster. We saw an example of an accelerated change in the Great Recession, which significantly lowered the labor force participation rate. However, research suggests such a drop would have eventually happened on its own as Baby Boomers retired and left the job market in the 2010s.³

The key is that long-term trends hold true. They are predictions of how people will react to things over time on average. Sometimes, that average is a mix of long stagnant (unchanging) periods combined with dramatic change periods.

The predictive strength of long-term projections with stagnant and dramatic periods can be seen in the food and accommodations industry. Throughout the 2010s, food workers’ wages did not see increases along with many other professions.⁴ As the pandemic hit these occupations particularly hard, it displaced people from these jobs and into other opportunities. Now, we see wages increasing significantly in an effort to incentivize people back into these jobs. The Conference Board estimates that for leisure and hospitality workers, average hourly earnings increased at an astounding annual rate of 17% between March and July 2021.⁵ The Bureau of Labor Statistics echoes such sentiment, noting within their projections report that the leisure and hospitality industry is predicted to experience the highest wage growth of any industry.³

We see that after a period of stagnant wage growth, as much of the 2010s were, the pandemic and associated recession was the event that motivated employers to increase wages. With that in mind, long-term projections are a useful tool. They can help us understand a broad view of what is ahead, although they can’t predict exactly what events might cause the changes to occur. For more information, visit the Bureau of Labor Statistics report. Utah’s own 2018-2028 projections can be found here. The 2020-2030 state projections will be available in 2022.⁶

References

[1] https://www.bloomberg.com/opinion/articles/2021-07-09/after-covid-the-new-normal-will-look-a-lot-like-the-old-normal

[2] https://www.mckinsey.com/industries/consumer-packaged-goods/our-insights/the-consumer-demand-recovery-and-lasting-effects-of-covid-19

[3] https://www.bls.gov/news.release/ecopro.nr0.htm

[4] https://www.epi.org/publication/restaurant-workers/

[5] https://www.prnewswire.com/news-releases/commentary-on-july-us-bureau-of-labor-statistics-employment-situation-report-301350333.html

[6] https://jobs.utah.gov/wi/data/library/employment/occprojections.html