By the year 2024, the national economy is projected to add 9.8 million jobs, health care and social assistance will have the most jobs and labor force participation will drop as the last of the baby boomers retire.
These projections are part of the long-term employment and occupation projections for the nation released by the U.S. Bureau of Labor Statistics every two years. Projections attempt to answer the question, “What will the economy look like a decade from now, if it were to be running at full capacity?” This information is provided for long-term planning for decision makers and for those planning their career options.
In its latest iteration of projections covering the decade from 2014 to 2024, the Bureau of Labor Statistics expects the national economy to grow, but more modestly than typically seen in the past as effects of an older population in 2024 creates downward pressure on labor force participation. The strongest job prospects will be generated by growth in health care and health care-related occupations. While projection information specific to Idaho will be released in June 2016, looking at national expectations will lend insight to what Idaho can expect.
BLS expects that 9.8 million new jobs will be added to the economy by 2024 – a growth rate of 6.5 percent. This may appear high, but compared to past performances it’s lower than the United States has enjoyed for over 60 years. As Figure 1 indicates, comparing this rate to similar measures stretching back in time to 1949, it has only been since 2008 that the 10-year growth rate has dipped below 10 percent and has averaged 3.4 percent since then. As much of this moderated experience is due to the effects of the Great Recession, projecting forward with 6.5 percent is a departure from what the nation has known in the last half-century.
Source: U.S. Bureau of Labor Statistics
However, this projection should not be mistaken for pessimism. In fact BLS projects real Gross Domestic Product will grow by 2.2 percent. Perhaps the most significant factor influencing projected job growth is population demographics. As time marches on through 2024, the proportion of older age groups in the population will get larger. Baby boomers will be still be entering the prime retirement age as the youngest of their generation will be 60 years of age by 2024. As this large portion of the population retires, the labor force participation rate is expected to decline from 62.9 percent in 2014 to 60.9 percent in 2024. More workers 65 years of age and older will likely work longer before retiring, and the participation rate for this group is expected to grow from 18.6 percent to 21.7 percent, but will not be enough to offset the overall reduction. In addition, a smaller proportion of younger people aged 16 to 24 are expected to be in the labor force, their participation rate declining from 55.0 percent in 2014 to 49.7 percent in 2024.
The primary reason BLS began developing long-term projections was to provide information for those planning careers and making strategic long-term decisions about how much time and expense to invest in obtaining education and training for an occupation.
In this projection series from 2014 to 2024, job and occupations related to health care and social assistance are expected to grow the fastest and be the largest major employment sector (see Figure 2).
It will grow from 12.0 percent of the nation’s total employment in 2014 to 13.4 percent in 2024. State and local government employment is currently the largest sector comprising 12.7 percent of total employment, but that proportion is expected to decline to 12.4 percent in 2024.
Strong growth in health care and social assistance will also lead to strong job growth in health care-related occupations. Health care practitioners and technical occupations are expected to grow by 13.2 percent and support occupations by 23.0 percent. The growth for these two major occupational groups combined will account for one out of every four expected new jobs.
This latest round of national projections provide insight into Idaho’s upcoming release of 2014 to 2024 projections in June 2016. While growth for Idaho industries and jobs vary from national rates, strong growth in health care and social assistance for the nation will likely be similar for Idaho where it already is the largest employment sector and has been the fastest growing in previous projection rounds.
Total projection rates and growth rates tend to be higher for Idaho compared to the national average, but an aging population and labor force demographics may also change the nature of expected job growth. The release in June will answer these questions.
Craig.Shaul@labor.idaho.gov, regional economist supervisor
(208) 332-3570 ext. 3201