Healthcare Jobs Just Grew At Fastest Pace Since 1991
For nearly two years between 2012 and 2014, every monthly jobs report hinted at a big change in health care — and our economy:
Hospitals just weren’t hiring.
“Jobs are growing. Health care is booming. So why are hospitals flat?” I wondered last August in FORBES.
It was an important development because hospitals historically have been economic engines in their regions. You can pick nearly any congressional district — hospitals are the #1 or #2 largest employer.
And at the time, hospital jobs growth was dramatically lagging the rest of the economy, as well as related sectors like doctors’ offices and outpatient care centers. You can look and see — compared to the rest of the health care industry’s rapid rise, hospital jobs growth basically flatlined for two years.
But times have changed.
Friday’s jobs report was the 10th straight month of jobs growth for hospitals, and the sector’s 14th month of jobs gains in the past 15.
The hospital sector has now gained more than 100,000 jobs in the past year, the Bureau of Labor Statistics reported on Friday.
The last time the hospital sector gained this many jobs was in 2008, before the recession’s effects really kicked in.
(The economic downturn seemingly forced hospitals to become more productive, as Austin Frakt recently wrote in the New York Times.)
It’s important to note: The overall economy has been marching upwards since March 2010 — coincidentally, the month that the Affordable Care Act was signed into law. The private sector has gained 12.3 million jobs since the depths of the recession.
That rising tide has lifted all boats, including health care.
And while Obamacare may or may not be a job-killer, it’s clearly been a major driver of health care jobs growth. The law’s effects have been especially felt in the past year, as the ACA’s dual strategy for coverage expansion — the launch of the insurance exchanges, and growth of the Medicaid program — have kicked in. The nation’s uninsurance rate has fallen to a record low of about 11%, nearly half of what it was just a few years ago.
That means less bad debt for hospitals, and more revenue. And hospitals increasingly are reporting their best financial performance in years.
In Ohio, Cleveland Clinic just announced that operating income year-over-year is up about 45%, largely because of the Medicaid expansion in the state. National hospital chain HCA chalked up $500 million in adjusted EBITDA this year to the Affordable Care Act.
Moody’s recently said that after several years of slowth — slowing growth — in hospital revenue, 2014 was a bounce-back year.
(Important note: “Slowth” is my wonky term, not Moody’s.)
Of course, there’s a dark side to health care jobs growth: When the health care sector booms, that likely brings more health care spending, too.
And those costs have to go somewhere — which may not be helpful for our economy.
“The goal of improving health and economic well-being does not go hand in hand with rising employment in health care,” Harvard’s Katherine Baicker and Amitabh Chandra wrote in NEJM in 2012.
“The bottom line is that employment in the health care sector should be neither a policy goal nor a metric of success.”
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