Monitoring the Trends

The Bureau of Labor Statistics has to be an interesting place to work. The almost 140-year-old government agency is responsible for gathering and disseminating data on jobs, wages and changes in the labor force, economic growth, and also for generating the various inflation numbers that drive so much of our financial life. Sounds like tons of fun, right?

The BLS also offers forecasts, and they just came out with a host of projections for this decade. While this isn’t meant to be a crystal ball, these projections shine a light on important trends in our economy. These trends impact your life and the lives of those around you in a variety of ways, so it’s important to pay attention to them.

You could probably guess many of the trends because most have been in place for some time. But as with so much else lately they’ve been accelerated since the pandemic started, in some cases dramatically. This research is done for every decade, so accounting for a tumultuous first year in 2020 must have been a challenge for the folks at the BLS.

I’m going to lay out a very brief summary of their projections below but am also providing links to a better summary from Bloomberg and then to the news release from the BLS. That way you can decide how deep you want to go if you’d like more information.

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Our economy and job environment are expected to grow coming out of the pandemic, but the growth rate could be about half of pre-pandemic normal. In other words, from 2020 on much of the job growth in the next decade will come from replacing jobs lost in 2020, not all new job creation.

The workforce will get older as it gets smaller and more productive. All Baby Boomers will be at least 65 by 2030, and many will have retired from the workforce by then. Younger people and men are expected to work less but many jobs will be replaced by technology and that increases productivity across the labor force. It also tends to widen the earnings gap.

Job growth by industry seems to track with an aging population that has an increasing life expectancy. Healthcare support roles (not doctors but their assistants) are expected to grow faster than manufacturing jobs, for example.

But sectors hit hard in the pandemic-era, such as leisure and hospitality, are expected to show the most growth in the next decade, on average, again based on a 2020 start date. Ironically, these are the same types of lower wage jobs that employers report being hard to fill now.

Brick-and-mortar retail should continue to suffer with the accelerating move toward e-everything while associated computer and tech-related fields are expected to continue flourishing.

The fastest growing jobs of this decade also tend toward low wages with one exception: software developers. These jobs are expected to grow faster than even RN jobs and pay almost 50% more, on average, according to the BLS.

While these projections seem positive, they also show underlying structural issues within our economy that may grow to be a drag on growth this decade and beyond.

Here’s an anecdotal example. This past weekend I heard the head of a trade group bemoan the lack of skilled tradespeople in our economy, another trend long in the making but exacerbated by the pandemic. The rep talked about how the trades are woefully understaffed and the problem is expected to get worse. Reading through the BLS projections makes the reasons why seem obvious.

If the workforce is aging and shrinking a bit and “young people” want to go into tech instead of jobs requiring skill while getting their hands dirty, who will actually do the critical infrastructure work being debated in Congress? Retirements are expected to impact the trades too. Even if the powers that be appropriated money this year the projects could take many years to complete, especially if there’s a growing worker shortage to contend with.

Can we limit the “knowledge economy” to requiring a computer and desk, or can we somehow broaden how we think of intellectual capital? Who will today’s skilled plumbers, electricians and carpenters pass their knowledge to? Good questions that, in a way, encapsulate some of the issues present within our economy and job outlook.

Here’s a link to the Bloomberg article.

https://www.msn.com/en-us/money/markets/fewer-pediatricians-more-cooks-seen-in-dismal-us-jobs-outlook/ar-AAOmhgk?ocid=se

Here’s the link to the BLS press release, including some charts and relevant data.

https://www.bls.gov/news.release/pdf/ecopro.pdf

And here’s a link to a very interesting jobs database compiled by the BLS. It has information about pretty much every job out there and is a great resource. It’s also good for just looking over the fence to see what shade of green the grass is over there.

https://www.bls.gov/ooh/

Have questions? Ask me. I can help.

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