September Jobs Report Preview: Which Industries Have Prospered in the Decade Since the Financial Crisis?
September marked the tenth anniversary of the failure of Lehman Brothers. The country plunged into the deepest recession since the Great Depression, a downturn that battered a wide range of industries. Since then, some industries have recovered more fully than others. Ahead of jobs day this Friday, we examine which industries have bounced back most successfully over the past decade.
The past decade has seen the continuation of an employment trend that has been happening for a while now — the expansion of the service sector and the contraction of the goods-producing sector. The industries that gained the greatest share of employment from August 2008 to August 2018 are education and health services, professional and business services, and leisure and hospitality.
The education and health services industry was not hit by the recession to the extent other industries were. From 2008 to late 2010, it did not have a single month of negative job growth. The gains in education and health services are concentrated in the health industry — 85% of the gains in education and health services were in health care and social assistance.
The transportation and warehousing industry also boosted its share of nonfarm employment over the past decade, almost half of which was due to growth in warehousing. Couriers and messengers accounted for about another 20% of transportation and warehousing’s growth.
Service sectors that lost share are other services, financial activities, wholesale trade, information, and retail trade. We discussed changes in the financial industry in a previous blog post, which noted how the finance and insurance subindustry is still not back to its pre-crisis share of employment. The real estate subindustry, which has also not bounced back completely, has actually recovered more than the finance and insurance subindustry.
Every single goods-producing sector — mining and logging, manufacturing, and construction — makes up a smaller share of employment than it did in August 2008. Manufacturing has posted gangbusters growth since early 2017, but overall over the past decade it has struggled. Construction was an industry particularly hard hit by the housing crisis — construction employment as a share of overall employment was elevated going into the recession and then fell to a 40-year low during the downturn. It has begun to recover, but is still below its share in the late 1990s and early 2000s.
Finally, government is the industry that has seen the biggest decline in share of overall employment in the past 10 years. The biggest drops have been in state government, excluding education and local education.
This Friday, we’ll be looking to see whether industries that have registered good growth continue to dominate the jobs numbers. We’ll also be looking to see:
- Whether last month’s pop in wage growth continues.
- If the prime-age employment-population ratio starts to increase again or continues the stall-out we’ve seen over the past six months.
- Whether the rate of those working part-time for economic reasons continues its downward trend.