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Where the Jobs Will Be, Eventually


In the next decade, hot jobs for finance examiners but dismal times for semiconductor manufacturing.


The US economy will reward nerdiness more than muscle over the next 10 years, stressing education and training more than manual skills.

According to new estimates from the Labor Department, technical and professional employment will increase during the next decade while manufacturing jobs will decline. The one exception: construction, although homebuilders such as D.R. Horton (DHI), Hovnanian Enterprises (HOV), Pulte Homes (PHM) and Toll Brothers (TOL) have yet to shake off the mortgage meltdown and equipment maker Caterpillar (CAT) said third quarter 2009 revenue fell 44% from the same period a year ago on lower sales.

The US work force will become older and more racially diverse as it adds 15.3 million jobs by 2018. But the economy has lost about seven million jobs since the recession began in December 2007, so the projected job growth isn't as rosy as it seems.

The civilian labor force is projected to increase by 12.6 million by 2018, to 166.9 million people. Slower population growth and declining overall labor force participation are likely to contribute to a slowdown in job growth. The projected 8.2% increase by 2018 trails the 12.1% growth between 1998 and 2008.

Higher birth rates and increased immigration will make Hispanics the fastest-growing component of the labor force, projected to increase by 7.3 million or 33.1%. Asians are expected to increase 29.8% and blacks by 14.1%. Whites will comprise the largest part of the labor force -- 79.4% -- despite growing only 5.5% by 2018.

The Bureau of Labor Statistics updates its 10-year projections every two years. Detailed information about the future of the US workforce is available in the Monthly Labor Review.

The key projections:

  • About 50% of the new jobs will be in professional and service occupations where a post-high school degree or advanced training is required. Demand for workers with an Associate degree is projected to increase 19.1% by 2018; Bachelor's 16.6%; Master's 18.3%; and Doctorate, 16.6%. Demand for those with a post-secondary vocational certificate is expected to increase 13.2%. That's good news for traditional colleges and universities such as the University of California, New York University, and Penn State University, and it almost certainly means increased earnings at for-profit companies, including Apollo Group (APOL), Bridgeport Education (BPI), Career Education (CECO), DeVry (DV) and ITT Educational Services (ESI).

  • Increased regulation following the stock market's swan dive will make financial examiners one of the 30 fastest-growing occupations. Demand for accountants and auditors is projected to increase 41.2% by 2018. In addition to the government, banks and insurance companies such as JPMorgan Chase (JPM), Wells Fargo (WFC) and Allstate (ALL) are expected to hire in this sector.

  • Baby Boomers, or those born between 1946 and 1964, will continue to work as they grow older. The number of people aged 55 and above in the labor force is expected to increase by 12 million by 2018 and comprise about 25% of the labor force by 2018. This suggests many Boomers haven't set aside enough money for retirement and few count on Social Security. The aging boomers also will boost demand for medical care, driving demand for nurses, physical therapists, and home health aides.

  • The economy's long-term shift to services from manufacturing will continue. Service industries are expected to add 14.6 million jobs, or 95.4% of the projected increase in total employment with professional and business services (4.2 million) and health care and social assistance (4 million) leading job growth. Leisure and hospitality are projected to increase just 0.8% by 2018.

  • Industries with the largest projected employment declines include semiconductor manufacturing, motor vehicle parts production, apparel, newspapers, and wired telecommunication carriers. This isn't surprising as design of computer chips centers of major US companies such as Intel (INTC), Advanced Micro Devices (AMD), and Texas Instruments (TXN), but more production shifts to Asia. Newspaper advertising revenue continues to decline as evidenced by the lower year-over-year earnings reported by McClatchy (MNI), Gannett (GCI), New York Times (NYT) and Washington Post (WPO). One of these days, wired phones will earn a place in Smithsonian as wireless hand-held devices such as the Apple's (AAPL) iPhone and Research in Motion's (RIMM) BlackBerry increase functionality and become ubiquitous. The good news: The number of telemarketers is expected to decline 11.1% by 2018, thanks, in part, to increased Internet advertising and the National Do Not Call Registry.
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