Why You Should Care About This Part of the Job Market

By: Anneken Tappe · January 08, 2024 · Reading Time: 3 minutes

Stats vs Sentiment

We got a strong jobs report on Friday: 216,000 jobs added to the U.S. economy, far more than expected. This is unequivocally good news for American workers. But as so often, the story isn’t quite as simple.

The encouraging data contradict a palpable sense of economic uncertainty among many workers. The job market may be strong on paper, but cracks appear when you look closer, particularly in the care sector, which is key for a functional labor market and economy.

Care Sector Conundrum

A large portion of the growth in the jobs report was driven by gains in healthcare. But while employment is growing, the sector is also plagued by high service costs and low worker compensation.

Demand for care services is rising, and will continue to rise as the population ages and people live longer. For now, this demand remains unmet. Making matters worse, compensation for care workers remains relatively low, as shown by the median pay for these occupations in 2022:

•   Childcare workers: $13.71 per hour

•   Nursing assistants: $17.18 per hour

•   Home health and personal care aides: $14.51 per hour

•   Social workers: $26.61 per hour

This imbalance between job growth and pay highlights the broader disconnect between the seemingly healthy labor market and economic treatment of essential workers.

Rethinking Economic Health

The state of the care sector is a microcosm of the broader economic challenges that a “robust” labor market can still foster a less-than-ideal economy for some of its workers. That’s why we need context for economic data.

For example, the number of workers holding multiple jobs also hit an all-time high, suggesting it increasingly takes more work to make ends meet in the post-pandemic economy that has been marked by years of high inflation.

Read more about it here .

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