Healthcare carried Australia’s jobs boom. Now growth has slowed

New labour market analysis from Callam Pickering, Senior Economist at Indeed Australia, shows just how heavily Australia has relied on healthcare and social assistance to drive employment growth over the past five years.

Between 2020 and 2025, the sector added around 670,000 jobs. That accounts for more than a quarter of all job gains nationally, expanding at an annualised rate of 6.3 per cent. In effect, healthcare and social assistance underpinned Australia’s post-pandemic jobs boom.

But 2025 tells a different story.

Total employment growth slowed sharply last year, with 165,400 jobs added nationwide. That compares to 386,000 in 2024 and 369,000 in 2023. Within that slowdown, healthcare and social assistance were a major contributor. The sector added just 34,000 jobs in 2025, an annual growth rate of 1.4 per cent.

According to Pickering’s analysis, around 80 per cent of the overall decline in national job growth over the past year can be attributed to weaker momentum in healthcare and social assistance.

A temporary pause or early warning sign?

For aged care leaders, the question is whether this slowdown signals something structural or simply a pause in hiring.

Pickering suggests it is difficult to imagine healthcare and social assistance remaining weak for long. The demographic drivers are unchanged. Australia’s population is ageing rapidly, with baby boomers now entering their 80s. Demand for care continues to build.

Jobs and Skills Australia forecasts healthcare and social assistance will be the fastest growing industry over the next decade, with registered nurses and aged and disability carers among the fastest-growing occupations.

The fundamentals point to expansion. The short-term data shows hesitation.

What this means for aged care

For aged care providers, the timing is significant.

The sector is implementing strengthened Quality Standards, adjusting to funding and reporting reforms, and competing for talent across hospitals and disability services. A slowdown in hiring during 2025 may reflect cost pressures or caution amid reform. It does not reflect reduced need.

If anything, a temporary softening in employment growth could mask deeper supply constraints. When demand accelerates again, workforce shortages may intensify.

Healthcare has been carrying Australia’s labour market. If that engine slows, the national economy feels it. But for aged care leaders, the more pressing issue is operational. The demographic wave is not optional. It is scheduled.

The strategic task now is ensuring workforce pipelines, retention strategies and organisational capability are ready before growth rebounds.