The Evolving Landscape of Healthcare Employment Amid COVID-19 and Beyond

When the COVID-19 pandemic hit, it sent shockwaves through the healthcare industry. The sector faced significant workforce reductions as employees grappled with burnout, sought opportunities elsewhere, or opted for early retirement. By October 2022, the healthcare industry had managed to recover, but recruitment and retention of healthcare professionals have since become major challenges for health systems. Despite these hurdles, the industry has witnessed expansion, particularly in ambulatory care, a sector that has grown in response to shifting patient preferences.

The State of Healthcare Employment

According to the US Q4 2023 Healthcare Labor Market Update from Indeed Hiring Lab, total job postings were still 24% above their level from February 1, 2020. However, healthcare job postings have declined by 14.8% year-over-year. The exception to this trend was seen in positions for Physicians & Surgeons, Therapy roles, and a few others. Despite this decline, advertised pay in most categories has been growing at a faster annual rate than the national average, indicating efforts to attract and retain talent.

Healthcare Job Growth at a 32-Year High

In an unprecedented development, the healthcare industry saw a rate of employment growth that hadn't been witnessed in over three decades. In 2023, healthcare employment expanded by 3.9%, with one in four jobs created in the economy being in healthcare. A surge in demand for healthcare services, a return to pre-pandemic demand for care, and hiring to replace workers who left during the 'Great Resignation' of 2021 and 2022 were the primary drivers of this growth.

Increasing Demand in Ambulatory Care

Hospital employment has grown by 3.7% since February 2020, adding 192,700 jobs. However, employment in ambulatory care settings has outpaced this, growing by 9.2%. This growth has been driven by a shift in patient preferences, with more individuals seeking care in outpatient settings. Despite this growth, nursing and residential care employment remains 4.6% below pre-pandemic levels, largely due to nursing home closures, lower resident censuses, and staffing shortages.

Healthcare's Contribution to National Employment Rate

The healthcare sector has significantly contributed to the national employment rate, adding 70,300 jobs in January 2024 alone. This outpaces the average monthly increase of 58,000 positions in 2023. As of January 2024, the healthcare sector employed more than 17.36 million people, a significant increase from the 16.66 million employed in January 2023.

The Future of Healthcare Workforce

The U.S. Chamber of Commerce predicts a greater demand for healthcare and pharmaceutical workers, with over 3.3 million new jobs expected in the healthcare and social assistance sector in the next seven years. The U.S. Bureau of Labor Statistics projects that this sector will grow most rapidly and create about 45 percent of all projected job gains from 2022 to 2032. However, the future of the U.S. workforce is not without its challenges, including an aging workforce, increasing healthcare needs, and higher employment demands. Upskilling and reskilling the existing workforce, particularly in skills like digital and data literacy, leadership, flexibility, and creativity, is highlighted as a crucial solution to these challenges.