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Healthcare Job Growth Slows in 2017

News  |  By John Commins  
   May 08, 2017

Healthcare remains a vital source for job growth in the overall economy, but hospital job growth has declined by more than half so far this year.

Healthcare job creation remains strong in 2017 but the sector is no longer matching last year's explosive growth, new data from the Bureau of Labor Statistics show.

In the first four months of 2017, healthcare created 77,800 jobs, 10.5% of the 738,000 jobs created by in the U.S. economy for the period. In the first four months of 2016, healthcare created 119,800 jobs, slightly more than 16% of the 741,000 new jobs in the overall economy for the period.

Hospitals have created 19,900 new jobs in the first four months of 2017, a 54% decline when compared with the 44,200 new hospital jobs created in the first four months of 2016.

Nicole Smith, chief economist at Georgetown University Center on Education and the Workforce, says the slowdown in hospital hiring could be linked to churn around the Affordable Care Act.

"The Affordable Care Act in its initiation required a lot more bodies to do the work and take care of the additional 20-plus million new patients on the healthcare rolls," Smith says.

"Even in the recession the healthcare sector continued to add jobs. We're still adding, but maybe we are coming to a situation where we're meeting demand now. We're at an equilibrium."

The recent action by House Republicans to repeal the ACA and replace it with the American Health Care Act could also make hospital administrators skittish about hiring. 

"The last time the Congressional Budget Office evaluated the proposal they came up with a loss of 24 million insured Americans. Of course, that has ripple effects and implications for people in that sector and parallel sectors and downstream sectors," Smith says.

"Maybe hospitals are being pre-emptive and not hiring workers at the same pace as in the past in anticipation that this repeal and replace is actually going to go through. We can expect hospital hiring to really slow down until people get a handle on what is going to happen."

Ambulatory Services Leads the Sector

Ambulatory services continue to be the main driver of healthcare jobs, with 52,600 created in the first four months of 2017, including 14,200 jobs in April. However, that number is down about 26% from the 70,400 jobs created over the same four months of 2016.

Nursing home and residential care, the third pillar of healthcare provider job growth, shed 900 jobs in April, but held fairly steady in a year-over-year comparison with the first four months of 2016, with 5,200 new jobs created.

In all of 2016, healthcare created 394,400 new jobs, nearly 33,000 new jobs per month, about 18% of the 2.2 million jobs created in the larger economy. Healthcare employs about 15.8 million people, according to BLS.

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.

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