Hospital, nursing home losses dampen February's healthcare hiring

Healthcare hiring was anemic in February, which was still welcome news after January's job losses.

Preliminary federal jobs data released Friday show the healthcare industry added 19,900 jobs last month. While a smaller gain than other months in the industry's recovery from the COVID-19 fallout, February's modest hiring represents a rebound from January, in which the industry shed 84,700 jobs. While a noteworthy drop, that's still a far cry from the 1.4 million jobs the industry lost in April 2020, the month that contained the majority of healthcare's pandemic-related job losses.

February's preliminary numbers show a strong rebound in the ambulatory sector offset by hospital job losses and a nursing home sector that continues to get walloped.

Ambulatory healthcare jobs grew to the tune of 28,900 last month. That's after a dismal January in which the sector shed 19,000 jobs. Within ambulatory, physicians' offices added 8,700 jobs in February. Home health added 5,700 new jobs. Dentists' offices made 5,200 new hires. Medical and diagnostic labs added just 1,100 jobs.

Hospitals shed an estimated 2,200 jobs in February. That's after a rough January in which they lost 37,500 jobs, according to the revised data.

The BLS' preliminary data show nursing homes shed more jobs than any other healthcare sector in February, losing 11,600 jobs. That's even after the sector shrunk by 18,500 jobs in January. Nursing homes have had a harder recovery from the pandemic than other sectors because low wages, limited benefits and tough working conditions prevent them from hiring the workers they need.

Total nonfarm payroll employment grew by an estimated 379,000 in February, and the unemployment rate fell to 6.2% from 6.3% in January. The number of people on temporary layoff fell by 517,000 in February to 2.2 million. That measure is 1.5 million higher than the level a year earlier but is down significantly from its high of 18 million in April 2020.

Healthcare's job growth was dwarfed by the estimated 355,000 jobs added in leisure and hospitality last month, 80% of which was in food services and drinking places.

January's job numbers saw a significant downward revision. The U.S. Bureau of Labor Statistics revises each month's preliminary numbers with updated samples, and January's employment situation got much worse after its revision. The preliminary data showed healthcare had lost 30,000 jobs in January. BLS Economist John Mullins said the change is simply because the agency received additional samples from the various sectors of healthcare.

"We receive sample from people on an ongoing basis," he said. "In some cases, the later sample just moves it in a different direction or increases or decreases the size of the change."

Significant negative revisions brought down January's hiring totals particularly in hospitals and the ambulatory sector.