Healthcare sector overtakes retail as largest US employer, research finds

Kathleen Steele Gaivin   Business Daily News

The healthcare sector has overtaken retail as the largest industry by employment in the United States, according to a report published this month by the Stanford Institute for Economic Policy Research.

Jobs and wages in healthcare rose almost twice as fast as those in other industries between 1980 and 2022, according to the data. Healthcare jobs increased by 144.5%, compared with a rate of 64.6% for the overall US labor force.

The largest wage increases happened among nurses and other midlevel employees. Women made up the largest part of the nursing and aide workforce, although more men started to enter the field as well.

“There are several potential explanations for the strong employment and earnings growth of middle-class healthcare jobs. Entry barriers that limit the supply of doctors may have increased labor demand for midlevels and nurses, who sometimes substitute for doctors, including by providing more than half of primary care,” according to the report. “Improvements in diagnostic technology may reduce the demand for doctors, with sophisticated diagnostic skill in favor of midlevels and nurses who can administer tests and prescribe treatment based on technologically determined diagnoses.”

A reason for the increase in pay for nurses and aides is that those professionals have become more educated over time, according to the report. For nurses, a bachelor’s degree and even a master’s degree have become commonplace.

“Most aides are not required to have any postsecondary education, but many employers require or strongly encourage some vocational training for certification,” according to SIEPR.

For home health aides, certification is needed following federal mandated 75 hours of training, the authors noted. Some states required up to 180 hours of training.

Healthcare aides, including home health and nursing aides, make up the fastest-growing job category in healthcare, experiencing a 206.1% increase in jobs between 1980 and 2022, compared with a 143.4% increase for nurse roles, according to the report. At the same time, aides’ pay has increased at a slower rate than other healthcare workers. Wages for aides increased by 33.4% between 1980 and 2022, compared with 81.7% for nurses.