Importance of Labor and Capital in the Health Economy

Importance of Labor and Capital in the Health Economy

The flip side of spending is reflected through the jobs that have been created in the health economy. As shown in Table 1-3A, 15.5 million people—11.1 percent of all employed civilians—worked at various health services sites in 2009. These numbers continued to grow despite the loss of over 5 million jobs in the U.S economy between 2007 and 2009. Hospitals dominate, employing 40.5 percent of health care workers. Other major employers include offices and clinics of physicians (10 percent), nursing care facilities (12.1 percent), and offices and clinics of dentists (5.2 percent). Table 1-3B provides information on specific health care occupations and their growth since 1970. In 2009, there were over 972,000 physicians and almost 268,000 pharmacists. The nursing sector alone consisted of over 3 million people with over three-quarters of them trained as registered nurses. The considerable growth in health care personnel is evident. In 1970, there were 334,000 physicians, or 164 physicians per 100,000 people. By 2009, the number of physicians had increased by 191 percent to 972,000 or 317 per 100,000 population. The number of registered nurses had more than tripled by 2009, with their number per 100,000 population more than doubling from 369 to 842. Reflecting the increases in spending, the health care sector serves increasingly as a source of employment. Thus, cutbacks in spending on health care, if proposed and implemented, would typically mean cutbacks in employment opportunities. In addition to labor, a substantial amount of capital has been drawn to the U.S. health care system. The number of nursing home beds increased from about 1.3 million in 1976 to about 1.7 million in 2009 (beds per capita, however, decreased slightly). The number of short-term



hospital beds (as distinguished from nursing homes) peaked in the late 1970s, at almost 1.5 million, but the total number has since leveled at approximately 950,000. There are also considerable and growing amounts of other capital—such as diagnostic equipment—per bed.