Investor's Business Daily
The Bureau of Labor Statistics has just issued a new report on employment growth over the next decade.
Prepared by the agency's career staff, it has an excellent record of forecasting industry and occupational trends. It contains good news for those seeking jobs — if they have the right skills.
To calculate job growth, the BLS first does a long-term economic forecast using the respected computer model of Macroeconomic Advisers. Its prediction is that real gross domestic product will rise at an average annual rate of 3% between 2002 and 2012. This is slightly less than the 3.4% annual rate in the 1980s and 3.2% in the 1990s. By 2012, the economy will have grown to $12.6 trillion (in 1996 dollars), up from $9.4 trillion in 2002.
The BLS sees investment spending by businesses as the driving force for growth. It is expected to rise at a 5.5% annual rate over the next decade.
Gray Areas
Increased spending on computers and software are a major reason for the higher investment. By 2012, businesses are expected to spend $1.6 trillion in this area, up from $420 billion in 2002, $75 billion in 1992 and just $11 billion in 1982 (all in 1996 dollars).
The BLS also envisions international trade rising in importance. Exports are expected to rise at a 5.7% annual rate and imports at a 5.2% rate. Imports and exports together will rise from 28% of GDP to 35% by 2012.
In addition to economic forces, demographic changes will have a powerful effect on the job outlook. The most important of these is the continued "graying" of the population as the baby boom generation ages.
The total labor force will rise by 12% between now and 2012, but those aged 55 and over will increase by almost 50%. By 2012, these aging baby boomers will increase their share of the labor force from 14.3% to 19.1%.
Improving health and life expectancy will cause many older workers to stay in the labor force, rather than retire. Those aged 65 to 74 are expected to raise their labor-force participation rate to 23.6% from 16.3% in 1992 and 20.4% in 2002. Even many of those 75 and older are expected to continue working. Their labor-force participation rate is projected to rise to 5.7% from 4.5% in 1992 and 5.1% in 2002.
Getting Raises
Putting all these factors together lets the BLS sort out the kinds of jobs that our economy will be creating in coming years. The good news is that most of the fastest-rising occupations are well-paying jobs. The bad news is that those industries experiencing job losses in recent years will continue to shed workers.
In the fastest-rising category, jobs in the computer and health fields stand out. Demand for medical assistants is expected to rise 59% by 2012, and that for network systems and data communications analysts will grow 57%. Other health occupations expected to grow significantly are physician assistants (49%), home health aides (48%), medical records and health information technicians (47%) and physical therapist aides (46%).
Among computer-oriented jobs, the BLS expects these positions to grow most rapidly: computer software engineers (46%), database administrators (44%), computer systems analysts (39%) and network and computer systems administrators (37%).
Looking at the 30 fastest-growing occupations, 13 are expected to pay wages in the top 25% of all workers and another six are in the second quartile. Thus nearly two-thirds of the fastest-growing jobs will pay above the median wage. Only three occupational categories fall into the lowest quartile.
The positions with the largest absolute growth also tend to be highest paying. The top two jobs in this classification are registered nurses and post-secondary teachers. The former are expected to add 623,000 positions by 2012 and the latter will add 603,000. Both pay in the top 25%.
Other occupations with large employment growth among those in the top wage category are general and operations managers (376,000), manufacturer sales representatives (279,000), accountants (205,000), computer systems analysts (184,000), secondary school teachers (180,000), computer software engineers (179,000) and management analysts (176,000).
Get Ready
As one can see, almost all these positions require significant education and training. Jobs requiring little education will tend to decline. Those positions also tend to pay below-average wages.
In summary, the U.S. is expected to create more than enough jobs over the coming decade to hire everyone coming into the labor force. And many of the fastest-growing occupations are among the best paying. But they also demand more education and training from those who get these jobs. Those with it will prosper; those without it are going to be left behind.