Healthcare lost 30K jobs in January in first setback since pandemic hit

Dive Brief:

  • The healthcare sector lost 30,000 jobs in January after posting consistent monthly gains since April’s significant losses when the pandemic hit, according to the latest jobs report from the Bureau of Labor Statistics.
  • Nursing care facilities were the hardest hit, losing 19,000 jobs, followed by home health services and community care facilities for the elderly. Hospitals lost about 2,000 jobs from December to January based on the preliminary figures.
  • Employment in the sector is still down by 542,000 jobs compared to February of last year. While the healthcare sector posted losses, overall, the U.S. added 49,000 jobs in January. The unemployment rate overall is now at 6.3%.

Dive Insight:

The healthcare sector lost a whopping 1.4 million jobs in April 2020 amid restrictions on non-essential medical services and lockdowns. Ambulatory service jobs were hard hit along with dentists and other doctor’s offices.

While a lot of those jobs bounced back in the following months, they slowed in the fall and winter months. January’s loss of 30,000 jobs is the first for the sector overall since the pandemic hit.

In the previous monthly report, healthcare added 39,000 jobs with the bulk of growth in hospitals and ambulatory healthcare services, though gains were slightly offset by declines in nursing care facilities, which have suffered grave employment losses throughout the pandemic.

Nursing homes have lost about 160,000 jobs since March, according to BLS data.

Home health services on the other hand have posted consistent monthly gains up until January, when jobs declined by 13,000.

Home healthcare services saw a surge in demand in wake of COVID-19 fears in nursing homes, though employment numbers in the sector are still slightly below where they were during the same time last year.

It’s unclear where a rapidly aging population will ultimately go to seek care, though jobs at nursing homes and home health services “could be substituted for by people leaving the workforce, by family members working fewer hours or not at all to take care of their loved ones,” Erica Groshen, former BLS commissioner and senior labor economics advisor at Cornell’s School of Industrial and Labor Relations, said.

The pandemic’s long-term impact on healthcare employment is still unclear. BLS projects employment in healthcare occupations to grow 15% from 2019 to 2029, much faster than the average for all other occupations, adding about 2.4 million new jobs.

That estimate was released in September though, using data predating the pandemic. The sector still has 542,000 jobs to recover before getting back to pre-pandemic levels.