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Stop the Presses: New Employment Projections!

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Regulars of my blog know that I love to dig into the Bureau of Labor Statistics employment projections (who doesn't?). The Bureau recently published their latest projections, for 2010-20, which provide a look into the future of the job market... one that's pretty reliable, at least in terms of the composition of employment. That is, since they assume full employment, you can't count so much on the predicted quantities here, but their track record on what kinds of jobs by industry and occupation is good. Not perfect, of course... they can't foresee technological changes, like the spread of websites like Travelocity, which did a number on their travel-agent predictions a few years back.

So, here are just a few highlights, but this is one of those moments where you'll want to break out the chips and salsa and just stroll through these tables yourselves (which the Bureau makes awfully easy as they're all collapsed into a few spreadsheets -- I'm not announcing my candidacy, but if I were president, here's an agency budget I'd add to).

Everybody Doesn't Have to Be a Rocket Scientist

To hear policy makers go on about the alleged skills mismatch between what employers demand and what workers supply, you'd think all the new jobs are going to require at least a four-year degree. But look at the list of the occupations expected to add the most jobs over the next decade, ranked in order of the number of jobs BLS predicts they'll add (here are the top 15).

2012-02-17-occlist15.png

Source: BLS Employment Projections

For sure, there are jobs requiring college or more, including nurses (#1), teachers, and physicians. But most do not. The chart below just takes the first three occupations expected to add the most jobs and plots there educational composition as of 2010. Nurses skew right but the others skew left.

2012-02-17-ed_comp1.png

Source: BLS Employment Projections

Now, before the skill freaks come after me, let me be very explicit: first, who's to say that the skill demands for a food prep worker or cashier will be the same in 2020 as in 2010? Skill requirements could go up or down. Second, and more importantly, we're often better off -- and I include the worker herself in "we" -- if people within these occupational categories have more skills and training. As I've said before, a home health aide with an associate's degree in gerontology studies is a better home health aide, one who adds more value, add one who should earn a higher wage.

But based on a lot of what we hear, I suspect the average guy or gal on the street would be surprised to see the occupations on that list.

Productivity Effects

I found this next figure awfully interesting as well.

It plots job growth by industry against output growth. Thus, where each industry dot locates is a function of its productivity growth.

2012-02-17-ind_prod.png

Dots in the upper right quadrant above the 45-degree line are industries with positive productivity growth expected to add jobs. Those like information (publishing, broadcasting, telecom) or financial services are expected to add a lot more growth than jobs. Those below the line, like health care and education, are big job creators, but are productivity constrained. [Note: this isn't an obviously bad thing -- we could make our teachers a lot more "productive" by tripling class size.]

Then there are those industries in the upper left where output grows faster than employment. They're "too productive" at least in terms of job creation.

Note that the Bureau predicts the loss of manufacturing jobs over the decade -- actually, just 73,000 over 10 years, but what's up with that? It's not worse trade outcomes: they predict goods' exports will exceed imports. It's just a continuation of long-term trend -- a trend that worsened in the 2000s, but has picked up a little steam in recent months.

Can policy change that result? Perhaps some, but I wouldn't expect that manufacturing dot to move too far to the right (i.e., towards much more employment growth). But unlike some others, including one of my favorite economists out there, I think we should try. The sector is important not just for job growth -- though those are very important too -- but for its contribution to R&D, productivity, and the ability to unwind our trade imbalances.

Next: some of BLS's workforce predictions. I know!... I can hardly wait either!

This post originally appeared at Jared Bernstein's On The Economy blog.