Labor Department forecast: Aging Baby Boomers will reshape the employment market over the next decade.
The retirement of aging Baby Boomers will reshape the job market over the next decade, leading to the smallest portion of Americans employed or looking for work since the mid-1970s, barely six in 10, a new Labor Department forecast predicts.
The result: slower economic growth but new employment opportunities in health care, where millions of new jobs are likely to be created.
As Boomers retire, the labor force participation rate -- the portion of all Americans available to work who have a job or are seeking one -- is projected to fall to 61.6 percent by 2022 from November’s record low 63 percent, according to Bureau of Labor Statistics projections released last week.
Over time, a smaller labor force leads to less economic growth, which depends on the output of each worker. From 2012 to 2022, the economy is projected to grow 2.6 percent a year, vs. 3 percent or higher from the mid-1990s to the mid-2000s, the BLS says.
Elderly Boomers will need more health care, however. The health care and social assistance industry will grow an average 2.6 percent a year and comprise nearly a third of the 15.6 million U.S. job gains during the 10-year period, the BLS estimates.
Nearly half of the 30 fastest-growing occupations from 2012 to 2022 will be health care-related, BLS estimates. Among them: home health aides, physician assistants, occupational therapy assistants and dental hygienists.
In its previous 10-year forecast in 2011, health care and social assistance was expected to make up slightly more than one in four job gains and five of the 30 fastest-growing occupations. Social assistance includes care for the elderly and disabled, and vocational rehabilitation.
“The aging of the population is the primary contributor,” says BLS economist Michael Wolf, a co-author of the forecast. “And the range of new treatment options and new technology is expanding the type of health care (patients) are receiving.”
The BLS also predicts: Construction will be the second-fastest-growing sector, also expanding at a 2.6 percent yearly rate. Yet despite adding an anticipated 1.6 million jobs during the 10-year period, construction will still be 440,000
workers below its peak employment of 7.7 million in 2006 before the real estate crash.
The next fastest-growing sectors in order will be educational services, followed by professional and business services and mining.
Several sectors are expected to shrink by 2022. They include the federal government, by 1.6 percent, or 407,000 jobs; utilities, by 1.1 percent, or 56,000 jobs; and manufacturing, by 0.5 percent, or 549,000 jobs.
Not all of the predictions are universally accepted. The Boston Consulting Group expects manufacturing to add several million jobs by 2020 as rising Chinese wages and a U.S. natural gas boom that has lowered energy prices, among other factors, increase the advantages of U.S. production.
Jobs that typically require post-high school education had median wages of $57,770 last year and are projected to grow by 14 percent from 2012 to 2022.
By contrast, jobs that generally demand a high school diploma or less had median wages of $27,670 and are projected to grow 9.1 percent.