The leisure and hospitality industry is driving US job growth

Service industry jobs in hotels, bars, and restaurants are hiring the most

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A foyer inside the Plaza Hotel.
Photo: Chris Hondros/Getty Images (Getty Images)

The labor market remains strong but job openings are declining, according to the newly released January job openings and labor turnover report by the US Bureau of Labor Statistics. The number of job openings decreased to 10.8 million, down from the 11.2 million in December.

More recently, private sector employment increased by 242,000 jobs in February, according to the ADP National Employment Report. The report shows annual pay was up 7.2% year-over-year in the private sector, with the biggest gains in leisure and hospitality making up 34% of the jobs.


In 2022, leisure and hospitality was the fastest growing sector in the US, with job openings up by 10% since January 2022. Meanwhile, job openings in the information sector have fallen by 55% since January 2022. Information private-sector jobs made up only 9,000 out of the 242,000 jobs in February.


Why leisure and hospitality jobs are up

The opposite trends are mostly the result of the covid-19 pandemic, when jobs in information increased during lockdowns and jobs in leisure and hospitality halted except for essential services. As the US moves out of the pandemic and more people return to travel, the leisure and hospitality sectors are recovering and rehiring to meet demand. More private-sector jobs are in the hospitality industry than in the information sector, which has helped keep the unemployment rate low. The healthcare and hospitality sectors that were hit harder by the pandemic make up around 30% of all private-sector jobs in the US.

Mass layoffs in the past months have meant fewer job openings in the information sector, particularly among US tech companies. Employers based in the US announced 102,943 cuts in January, a 136% increase from the 43,651 cuts announced in December, according to data from Challenger, Gray & Christmas, Inc. The research firm found January’s job cuts are the most since September 2020, which saw 118,804 job cuts.