U.S. job growth is expected to slow markedly over the next decade, the result of an aging population and a decline in the active labor force, according to new Labor Department projections.
The economy is forecast to add 6 million new jobs between 2020 and 2029, bringing the number of jobs to 168.8 million -- an annual growth rate of just 0.4%, the agency said. That's well below the rate of 1.3% in the decade following the 2008 financial crisis, which was the longest economic expansion on record until it ended in February amid the coronavirus pandemic.
The Bureau of Labor Statistics expects economic growth to slow to a 1.8% annual rate from 2.3% in the previous decade.
The projections exclude the effects of the COVID-19 crisis, which triggered a loss of some 25 million jobs before employers started to gradually re-hire those workers, and subsequent response efforts.
The nation's unemployment rate was officially at 10.2% at the end of July (the government will release up-to-date figures on Friday). Over the past three months, the economy has added back less than half -- about 42 percent -- of the 22 million jobs it lost during the pandemic, data shows. There are still 10.6 million more out-of-work Americans than in February.
The department said the virus could cause “new structural changes to the economy." Later projections will account for the pandemic.
Even without the pandemic, however, job growth is still expected to moderate over the next decade. By 2029, all baby boomers will be at least 65, and their retirements will contribute to a drop in the number of people participating in the labor force, the report showed.
Many occupations are expected to see significant growth in the coming years, with health care and social assistance services projected to account for the biggest gains. In fact, five out of the 20 fastest-growing industries in the next decade are in the health care and social assistance sector.
"Factors that are expected to contribute to the large increase include increased demand to care for the aging baby-boom population, longer life expectancies, and continued growth in the number of patients with chronic conditions," the report said.
Some industries may also see significant declines in employment: Manufacturing is projected to lose some 444,800 jobs, the most of any sector, as a result of new technologies, like robotics, and international competition. And as the e-commerce sector continues to grow, retail is expected to lose 368,300 jobs.