Labor

Markets with Robust Construction Pipelines Expect Strong Employment Growth

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Projected Growth in Labor Pool and Lab Inventory

^{Source: Lightcast, Cushman & Wakefield Research}

While most markets temper their construction pipelines, double-digit employment growth is expected in five markets through 2028.
The three markets with the largest construction pipelines—Boston, the San Francisco Bay Area and San Diego—also have some of the strongest expected employment growth. Boston, San Diego and Raleigh-Durham have construction pipelines that are above 15% as a percent of existing inventory.
Through 2028, Boston’s life sciences talent pool is expected to grow an additional 17%. The current inventory-to-talent ratio for Boston is 400 sf per employee. The employment forecast means that over 7 msf is needed to accommodate new talent in Boston. The current pipeline of nearly 9 msf should accommodate this growth.
The San Francisco Bay Area has a higher inventory-to-talent ratio of 408 sf per employee. Based on this ratio, an additional 6 msf will be needed to accommodate employment growth of 13% through 2028.

Key Takeaway: Robust life sciences employment growth is expected in Boston, the San Francisco Bay Area, Seattle, Raleigh-Durham and San Diego in the next five years.

Hub and Secondary Markets Have the Largest Employment Base

Life Sciences Total Employment by Market (MSA), 2023

^{Source: Lightcast}

The top 10 employment markets account for 69% of life sciences employment.
As defined by Cushman & Wakefield, a hub market typically contains a large employment base, and significant lab and cGMP inventory. All six hub markets are in the top 10 by employment. Included in the top 10 are secondary markets, including New York, New Jersey, Los Angeles-Orange County and Chicago.
Life sciences employment growth has been robust in all markets in the last five years. Notably, emerging markets experienced the strongest growth (26%), followed by hub markets (24%) and secondary markets (14%).
Looking forward, the employment forecast calls for growth to decelerate over the next five years but remain positive. Hub markets are forecast to grow 11%, followed by emerging markets at 10% and secondary markets at 4%.

Key Takeaway: Major life sciences employment hubs will continue to be drivers of life sciences and lab real estate. Watch for large secondary markets (e.g., New York, New Jersey, Los Angeles-Orange County and Chicago) to also be life sciences growth spots in the coming years.

Life Sciences Labor Market Recalibration

US Life Sciences Job Postings Decline After Post- Pandemic Peak

^{Source: Lightcast}

The life sciences sector faced several rounds of layoff announcements in 2023. This led to a deceleration in job postings, although hiring levels were on par with 2022.
Job postings during the last 12 months were 25% slower than the previous 12-month period. Hirings outpaced job postings by 2%.
The slowdown in postings indicates that employers were more likely to fill open positions in 2023 than the previous two years. However, current job postings have a 3-to-1 intensity ratio, meaning that each unique job is posted an average of three times. This underscores continued challenges in staffing some positions.
The number of students completing life sciences degrees has grown 10% since 2019. While not all of these degrees will lead to a career in the sector, it provides a larger pool of skilled talent.

Key Takeaway: Some slack in the labor market is welcomed by employers that faced difficulties in filling open positions. However, challenges remain for in-demand occupations.

Hub Markets Continued the Search for Talent in 2023

Top 20 Markets – Job Postings 2023

City	Total Postings	Unique Postings	Median Posting Duration
Boston-Cambridge, MA*	43,916	13,861	31 days
Houston, TX	24,668	8,506	29 days
New York, NY	22,690	7,870	28 days
San Diego, CA*	28,171	6,516	29 days
Los Angeles, CA	52,104	6,354	29 days
Suburban Maryland*	20,447	5,779	26 days
Chicago, IL	19,130	5,289	28 days
Philadelphia, PA*	14,296	4,914	28 days
Raleigh- Durham, NC*	13,094	4,408	27 days
Atlanta, GA	10,634	4,128	29 days
San Francisco, CA*	15,586	3,840	30 days
Seattle, WA	14,473	3,748	29 days
Indianapolis, IN	11,792	3,680	28 days
Saint Louis, MO	10,228	3,482	28 days
Dallas, TX	11,413	3,346	27 days
Cincinnati, OH	9,890	3,238	28 days
Phoenix, AZ	12,056	3,055	28 days
Minneapolis, MN	8,042	2,842	27 days
Austin, TX	7,367	2,649	27 days
San Antonio, TX	9,253	2,507	30 days

^{* Hub Market}
^{Source: Lightcast}

Most life sciences job postings in 2023 were based in hub markets, with five of the hub markets among the top 10 markets.
The Boston-Cambridge market had the most unique postings, meaning that companies were looking to fill nearly 14,000 jobs in 2023. These jobs were posted an average of 3.2 times, reflecting the difficulty in filling some of these positions.
Notably, Los Angles had over 6,000 unique job postings, but they were posted 8.2 times on average, more than in any other market.

Key Takeaway: Job postings may have slowed down in 2023, but that does not equate with employers having an easier time filling open positions. One of the main hurdles is the availability of highly skilled talent.

The life sciences labor market experienced some easing in 2023. However, occupations that are high in demand remained difficult to fill.

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Employers Search for Very Specific Talent

Top Posted Occupations

^{Source: Lightcast}

Half of job openings were focused on two occupations: Clinical Laboratory Technologists and Technicians, and Medical Scientists.
The top five posted job titles were Laboratory Technician, Process Engineer, Medical Laboratory Technician, Laboratory Assistant and Medical Technologist.
The top five skills requested were Biology, Chemistry, Medical Laboratory, Laboratory Equipment and Clinical Trials.
Three-quarters of postings requested that applicants have a bachelor’s degree or higher.

Key Takeaway: Talent with skills and qualifications that fit high-demand occupations is needed to bridge the hiring gap.

Highly Educated Talent is Necessary for Most Life Sciences Occupations

Percent of Higher Education Degree Completions, 2018-2022

^{Source: Lightcast}

A high composition of higher education degrees in a market provides a significant advantage to employers seeking highly educated talent pools.
Raleigh-Durham, Philadelphia and Boston boast highly educated workforces, with over 93% of all completions between 2018 to 2022 attaining a bachelor’s degree or higher. Among all markets, Raleigh-Durham has the highest concentration of doctorate degree completions, and suburban Maryland has the highest concentration of master's degree completions.
In terms of absolute number of degree completions, the New York MSA has the greatest number of bachelor's, master's and doctorate degree completions.

Key Takeaway: Finding talent with the right set of skills may require focusing on markets with highly educated talent pools.

Wages Have Grown Modestly Across Hub and Secondary Markets

Life Sciences Occupations: Annual Median Earnings and Growth by MSA

^{Source: Lightcast}

Annual median earnings for life sciences occupations averaged $82,300 across hub and secondary markets in 2022. Median earnings grew 3.1% annually between 2018 and 2022, which lags the national average of 3.9%. However, compared to national average median earnings of $45,800, life sciences labor is much costlier.
Earnings are highest in the San Francisco Bay Area, where the cost-of-living (COL) index is 167. Wages have grown faster than the national average, at 5.2% per year.
Boston also has a high cost of labor, with annual growth of 5.5% in earnings and a COL index of 135.
Chicago has the lowest median earnings of $68,400 per year. Wages have grown slower at 2.4% annually since 2018, in part due to its lower COL index of 102.
Wages in Raleigh-Durham have seen modest growth of 0.7% annually, which aligns with its COL index of 99, the lowest among hub and secondary markets.

Key Takeaway: The cost of labor is significantly higher in the life sciences sector, but wage growth is slower than other major employment groups.