February marked the largest jump in hospital job adds since September 2022 while growth in ambulatory settings slowed, according to the latest numbers from the U.S. Bureau of Labor Statistics (BLS) released Friday morning.
Healthcare on the whole added 44,200 jobs comprising about 14.2% of the economywide 311,000 jobs added in February, the BLS said. The change was down from last month’s 52,800 jobs, which represented 10.5% of the substantial 517,000 total added that month.
Healthcare added an average of roughly 49,000 jobs per month across 2022 and just 9,000 in 2021.
“Strong gains in employment are generally good for healthcare providers. They need labor in the short term while they work to better leverage technology to do more with less,” Matt Wolf, healthcare senior analyst at consulting firm RSM US, told Fierce Healthcare in response to BLS’ latest report.
Prior to the release, the firm was expecting to see somewhere between 38,000 and 40,000 healthcare jobs added in February.
Hospitals alone added 19,400 jobs, up from January’s 13,200 additions and the largest gain since the 27,500 cited back in September. It’s good news for a sector that’s hoping to curb premium labor expenses and operate facilities at full capacity.
“While reductions in COVID and other surge volumes are allowing many operators to reduce reliance on contract nursing, the fact remains that clinical hospital staff are in high demand,” Wolf said. “Strong job gains like February’s may indicate more nurses and other employees who left healthcare are returning.”
Wolf also pointed to nursing and residential care’s “impressive” addition of 13,700 jobs, noting that the firm considers anything “above 9,000 to 10,000 to be positive.”
“Still, the senior care sector is 266,900 jobs below pre-pandemic employment,” he said. “Even at February’s aggressive pace of job creation, it would take 20 months to return to pre-pandemic employment. Meanwhile, demand for senior care continues to grow, which will require even more labor. Providers in this sub-sector will continue to face labor challenges for the foreseeable future.”
Ambulatory care services looked to be the slower segment of the market with 11,100 jobs added in February. This was down from the prior month’s 13,200 job gain.
This month’s release also included a downward revision of January’s numbers as BLS makes its annual adjustments for population growth.
“We were all watching the revisions to January’s report for signs of weakness,” Wolf said. “We expected a sizable reduction to last month’s surprise add of 517,000 jobs. BLS adjusted down to 504,000 jobs, and reduced December gains by 21,000. In our view, these represent small adjustments.”
February’s report generally carried good news for healthcare, but the numbers also have an impact on inflationary trends that can still impact healthcare finances. Specifically, job reports are among the main indicators reviewed by the central bank throughout its ongoing war against inflation.
“The strong employment gains will likely result in additional rate hikes from the Federal Reserve, which will pressure balance sheets and margins,” Wolf said.