Last week, a report from the Brookings Institution revealed that over the past decade, the healthcare industry has added 2.6 million jobs nationwide, making it the fastest growing industry in the U.S.
The healthcare sector’s 22.7 percent employment growth rate over that period dramatically outstripped the 2.1 percent employment growth rate in all other industries. The industry employs about 14.5 million people and accounts for 10.3 percent of jobs nationally in occupations that span the education, skills, and earnings continuum, the report said.
And that growth isn’t expected to stop anytime soon. The Bureau of Labor Statistics predicts the healthcare and social assistance sector is expected to grow by 33 percent, or 5.7 million new jobs by 2020. Employment growth will be driven by an aging population and longer life expectancies, as well as new treatments and technologies.
Why is the industry growing at such an astronomical rate? For one, the population is getting older. Yes, everyone gets older, but really, I mean older. According to statistics from the Department of Health and Human Services (HHS), by 2030, there will be about 72.1 million older persons, more than twice their number in 2000. People 65+ represented 12.4 percent of the population in the year 2000 but are expected to grow to be 19 percent of the population by 2030. And as Baby Boomers get onto Medicare, their medical needs will become far more complex, and thus more expensive.
And let’s face it: despite the economic recession, people are always going to get sick and injured. Nobody can really afford to forgo medical care.
But job growth in the industry is great, right? After all, don’t more Americans need jobs and an income? Not so quick. It is factors like these that make the demand for healthcare jobs so high, and it’s also these same reasons that make it increasingly difficult to get healthcare spending under control.
And although new reports say that the growth in healthcare spending has been curbed recently, nearly 18 percent of the gross domestic product (GDP) is still spent on healthcare in the U.S., while the next highest country is about 12 percent, as Donald Berwick, M.D., former acting administrator of the federal Centers for Medicare & Medicaid Services (CMS), said at the Healthcare Financial Management Association's (HFMA) annual conference in June. Without a doubt, the cost of healthcare poses one of the greatest threats to the country’s fiscal health, and the rate we’re currently spending at is unsustainable.
We spend a lot of money on healthcare because so many of us need it. When President Obama signed the Affordable Act, millions of more Americans entered the healthcare system. And the fact that the demand is so high means we might not be able to keep up—both the nursing and physician industries are challenged by shortages; the country will be short about 91,500 doctors by 2020, according to projections from the American Academy of Medical Colleges (AAMC). Our doctors are getting older, too, says the AAMC—nearly one-third of all physicians will retire in the next decade just as more Americans need care.
The Affordable Care Act has put an emphasis on accountable care, and electronic medical records (EMRs) and health information exchanges (HIEs) are helping us get there. Innovation and technology will help.
But there is still a ways to go in terms of cutting costs as well as getting healthier. After all, a report by the Commonwealth Fund in 2010 found that despite spending twice what Canada spends and three times what New Zealand spends on healthcare, the U.S. health system ranked last among seven industrialized nations on measures of health system performance in five areas: quality, efficiency, access to care, equity and the ability to lead long, healthy, productive lives.
So when we see reports like the one from Brookings showing the fast pace growth in healthcare jobs, let’s try to look at the reason why there are more jobs rather than just the fact that there are so many. Growth in jobs is great, but it doesn’t necessarily tell the whole story about where the healthcare system is headed.