Restaurants and hotels were helping power the booming job market. Now, they're barely hiring.

The leisure and hospitality industry is adding fewer jobs each month than it was a few years ago.

• Job opportunities seem to have dissipated for some previously strong industries.
• Leisure and hospitality is one sector where job gains are far below where they were a few years ago.
• Government and healthcare are areas of the labor market where many jobs are still being added.

Job seekers have it rough these days. Pay raises have cooled for job switchers. People looking for remote positions find this kind of work in short supply.

Plus, the leisure and hospitality industry, which had particularly robust job gains in 2021 as the overall labor market was still recovering from its deep losses during the early pandemic, has slowed hiring dramatically, adding to the less-than-ideal picture for job searchers.

"We're a service economy, and the service sector seems now to be struggling with the kind of rolling recession that hit interest rate-sensitive sectors first," Julia Pollak, chief economist at ZipRecruiter, told Business Insider. "We first saw tech and housing, real estate industries like that cool down, but we're now seeing weakness spill over into services, and that's the main engine of job growth in the US economy."

It took a long time for the leisure and hospitality industry to get back to where employment was in February 2020; it only surpassed this level this past May, while the economy as a whole passed that benchmark in June 2022. Still, the industry largely saw strong monthly job gains following the losses it faced early on in the pandemic, averaging 205,000 jobs a month in 2021.

But that breakneck pace has slowed to a trickle. Data out Friday from the Bureau of Labor Statistics showed this industry saw a month-over-month job gain of 7,000; the overall nonfarm payroll job gain in June was 206,000.

The industry has historically had higher rates of quits and job openings than the overall labor market, per the Job Openings and Labor Turnover Survey.

Professional and business services was another industry that had healthy job growth for a lot of 2021, averaging 115,000 jobs a month that year, but the story has changed; it saw a one-month job loss of 17,000 in June 2024.

Other sectors are still growing. Federal, state, and local governments together have a historically high number of employees, with around 23.4 million people, and the public sector added 70,000 jobs in June.

"I think the very high government payrolls number is a further testament to how much weaker things have gotten on the private sector side," Pollak said. "The government has been trying to rehire for years and struggling because the private sector was so strong. Now, people are falling back on those safer government jobs."

Additionally, the healthcare and social assistance sectors have seen robust job growth and likely will be looking for job seekers long-term. "The health care and social assistance sector is projected to not only grow most rapidly of any sector, but it is also projected to create about 45 percent of all the projected job gains from 2022 to 2032," BLS said in a news release in September 2023, as the US population continues to get older.

Pollak previously told BI healthcare is an industry that faces less risk of automation and could be considered a "recession-proof sector."

Still, healthcare monthly job gains pale in comparison to what the leisure and hospitality industry added for the majority of 2021 and the monthly gains in 2022. Healthcare added 48,600 jobs this past June, compared to leisure and hospitality's best month in 2021, which was 422,000 jobs added in July.

The overall tougher labor market still has potential for job seekers.

"I think it's one that workers still have some leverage, but not as much as in the recent past," Nick Bunker, the economic research director for North America at the Indeed Hiring Lab, told BI.