New England Economic Conditions through June 2, 2026

• Payroll employment in New England was unchanged in April 2026 compared with April 2025. See Exhibit 1.
• US payroll employment increased a scant 0.2 percent in the 12 months ending with April 2026, supported by a gain of 115,000 jobs in April alone.
• Half of New England's 10 supersectors experienced at least slight job growth (year-over-year) in April, and the other half saw modest to moderate job losses. See Exhibit 3.
• New England's health-care and social-assistance industry experienced modest year-over-year job growth that nonetheless fell short of the corresponding growth rate for the United States, extending a persistent pattern of recent years. See Exhibit 4.

New England's zero employment growth rate for April 2026 (Exhibit 1) represents an improvement from the small negative growth rates of the preceding 10 months, and the region appears to have added more than 31,000 jobs on net in the six months ending with April 2026, including a monthly gain of 17,400 jobs in April alone (Exhibit 2). However, given the sampling errors, it is too soon to say with a high degree of confidence that the payroll employment situation in New England is improving.¹ Based on anecdotal reports from employers around New England, the latest (May 2026) Beige Book report from the Boston Fed says, "Employment was mostly unchanged, as selective layoffs largely offset a pickup in hiring."²

The flat picture for total employment in New England obscures considerable heterogeneity across supersectors (Exhibit 3). Five supersectors in the region showed positive employment growth rates in April 2026 from one year earlier, ranging from slight (manufacturing, up 0.2 percent) to moderate (construction, up 1.6 percent), while the other five experienced net job losses that ranged from modest (-0.5 percent each for government and professional and business services) to substantial (-2.2 percent for information). New England experienced stronger employment growth (or less pronounced job losses) than the United States in several supersectors, including construction, manufacturing, government, and information.

Among industries in New England, the art, entertainment, and recreation industry had the highest job growth rate (2.6 percent), and federal government had the lowest (-6.4 percent). See Exhibit 4. At the national level, the health-care and social-assistance industry led in terms of job growth (2.8 percent), and federal government fared the worst (-10.5 percent). Health-care and social-assistance employment rose in New England as well (1.2 percent) but lagged considerably relative to the United States.

New England has experienced relatively weak employment growth in the health-care and social-assistance industry throughout most of the post-pandemic recovery period, reflecting factors on both the demand side and the supply side. Providers in Rhode Island report facing intense financial pressures from rising costs, which, combined with Medicaid reimbursement rates that are among the lowest in the nation, are contributing to recent layoffs.³ According to a Massachusetts report on the state's health-care workforce, labor shortages continue to hold back employment growth in the industry, even though hospital job vacancies in the state are down 28 percent from their post-pandemic (2022) peak.⁴ Separately, Massachusetts experienced layoffs in mental health services following reductions in federal funding to the state's Medicaid program and the implementation of state-level austerity measures.⁵

Exhibit 5 shows net employment growth since February 2020 (through April 2026) by supersector. For New England, construction leads on this measure, and educational and health services places second; nationwide, those positions are reversed, and the United States shows much greater net employment growth in the educational and health services sector compared with New England. Although not shown, most of that discrepancy owes to weak relative job growth in New England in the health-care and social-assistance industry since February 2020, with a smaller contribution from jobs in the educational services industry.

As of April 2026, all six New England states were showing considerable gains in construction employment relative to February 2020, with Maine, New Hampshire, and Rhode Island experiencing increases of 15 percent, 13 percent, and 10 percent, respectively. Construction employment in Massachusetts was on the decline from late 2023 through mid-2025 but has since surged, and as of April, it stood 3.4 percent above its February 2020 level. The recent rebound may reflect the Healey administration's target of building 222,000 new housing units by 2035 through initiatives such as the Affordable Homes Act, signed in August 2024. The aggressive policy push has reportedly translated into robust hiring, though state officials note this still falls short of what's needed to meet production goals for new housing.⁶