Economic Tumult Likely to Affect Healthcare Employment in 2009
Will a global recession send millions of healthcare workers to the unemployment lines in 2009? Not likely, but healthcare job opportunities are likely to be trimmed on the margins, as US employment continues to drop, taking with it the health insurance of many Americans and reducing consumers’ appetite for elective procedures. That’s the consensus of industry insiders and observers.
Employment Growth Likely to Soften
The outlook for 2009 is for a gradual softening in healthcare employment. “Growth will continue to slow,” says George Van Horn, a senior analyst with industry research firm IBISWorld. “Unemployment affects insurance coverage and how often people go to the doctor. Income and the availability of credit affect the ability of medical practitioners to expand. And you’d expect that elective procedures will decline.”
Still, even in October 2008, as the financial crisis spawned broader economic woes, medical and allied healthcare employment continued to rise. Employment in the healthcare industry topped 13.4 million workers, up 26,000 from the previous month and 348,000 greater than a year earlier, according to the Bureau of Labor Statistics. Employment marched upward in nearly all care settings: hospitals employed about 750,000 more people than a decade earlier; physicians’ offices had 60,000 more workers than in October 2007; and employment at nursing and residential care facilities was on track to hit 3 million by the end of 2008.
Recession Will Create Winners and Losers
The impact of the recession on healthcare employment will vary considerably according to healthcare specialty. “The winners will be critical care, outpatient care and emergency rooms; blood, organ and ambulatory services; and psychologists, social workers and others who treat stress,” Van Horn says. “The losers in this economy will be dentists, optometrists, chiropractors and practitioners in fertility and family planning.”
Certain niches, such as occupational health nurses, may see slower or declining growth in employment in 2009. Although demand for these specialty nurses, who treat workers in industrial and manufacturing settings, was strong into the last quarter of 2008, plant closings in some industries, especially automotive, could reduce demand, says Peter Ferguson, president of Health & Life Sciences at staffing firm Yoh.
Downturn to Put Downward Pressure on Salaries
The economic collapse that began in late 2008 may have a number of additional effects on healthcare job opportunities. For example, insurance companies that need to control healthcare costs might be tempted to cut case managers who work with employees of client companies, Ferguson says. “But ensuring that patients are tended [to] properly is actually a financial benefit for the company,” he says.
Despite the squeeze on healthcare spending, experienced healthcare professionals may find that if they do search for a new employer, they may be in great demand. “In this troubled economy, it can be hard to hire people, because they don’t want to risk going to a new employer,” says Jim Maestretti, director of compensation and talent acquisition at Regence, a nonprofit health insurer.
In the long term, the difficult economy is likely to exert downward pressure on healthcare pay. “Reimbursements are going to go down considerably, so healthcare professionals have to be concerned about their salaries,” says Levi Buck, CEO of Pacer Health Staffing.
Another potentially critical development for healthcare workers in 2009 and beyond: Reform. Fixing the broken healthcare system is a high priority of the new administration. “I see major reform ahead, with coverage expanding for the uninsured,” Buck says. “As more people gain access to healthcare, there will be fewer health professionals per capita, so the worker shortage will increase dramatically.”
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