Evolving Workforces

Growing Talent Pipeline Fuels Life Sciences Revolution Amid Challenging Equity Markets

March 10, 2022 2 Minute Read

Continued job growth and a loaded pipeline of new talent underpin positive momentum for the life sciences industry this year. Strong employment fueled by this sizeable talent pool contrasts with challenging equity markets for the biopharma industry, especially the biotech sector, where lower valuations have inhibited IPOs for expansion. Corporate R&D and venture capital funding have helped to fill the void.

Total U.S. life sciences employment increased 5.3% year-over-year in January, exceeding U.S. nonfarm employment growth of 4.7% over the same period. The pace of growth has naturally moderated from the sharp rebound from 2020’s downturn, but January’s annual rate is still higher than any pre-pandemic annual growth. Employment in the Biotechnology Research & Development subsector, in which a significant amount of the industry’s innovation is occurring, increased by 11.5% year-over-year in January, slightly below its all-time record of 12.4% in March 2019.

Figure 1: U.S. Life Sciences Year-over-Year Employment Growth

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Source: U.S. Bureau of Labor Statistics, CBRE Research, March 2022.

The effect of job growth on life sciences real estate is significant. For example, the Boston-Cambridge market had a 93% positive correlation between life sciences employment and average asking rents for laboratory/R&D space between 2001 and 2020. The recent national life sciences employment gains should support market conditions in Boston-Cambridge, as well as other key markets around the country.

Figure 2: Boston-Cambridge Metro Life Sciences Indicators

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Source: U.S. Bureau of Labor Statistics, CBRE Research, March 2022.

A growing pipeline of future industry talent is expected to satisfy the need for specialized workers. Figure 3 shows the considerable momentum in Biological and Biomedical Sciences graduates in the U.S. (approximately 5,000 per year between 2015 and 2020). Over the same period, employees in biology-based life sciences occupations1 increased by approximately 2,700 per year, suggesting the pipeline of talent is more than enough to prolong the “bio-boom.”

Figure 3: U.S. Degrees/Certificates Awarded at Postsecondary Institutions (2004-2005 = 1.0)

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Source: U.S. Dept. of Education, National Center for Education Statistics, IPEDS, CBRE Research, March 2022.

1 Includes the following occupations as designated by the U.S. Bureau of Labor Statistics: Bioengineers and Biomedical Engineers, Biochemists and Biophysicists, Microbiologists, Biological Scientists (All Other), Life Scientists (All Other) and Biological Technicians.