Healthcare industry to create 4 million jobs by 2026
The healthcare industry will continue to drive the nation’s employment growth through 2026 by adding around 4 million new jobs, accounting for about a third of total job growth, according to Bureau of Labor Statistics data released earlier this week.
The fastest-growing sectors include healthcare support occupations (23.2% increase from 2016-2026) and healthcare practitioners and technical occupations (15.2%), which entail home health aides, physician assistants, and nurse practitioners, among other positions. These two occupational groups which make up 14 of the 30 fastest-growing occupations across all industries from 2016 to 2026are projected to contribute about one-fifth of all new jobs by 2026.
The healthcare industry has long fueled the country’s economy. Demand is expected to pick up as the population ages, people live longer, more gain insurance coverage and chronic conditions become more prevalent.
Rising demand is sparking investment in the companies that outsource staffing services to providers, said Trey Crabb, executive director of not-for-profit hospital mergers and acquisitions at Morgan Stanley.
“There is also accelerated growth of well-funded ancillary businesses including behavioral services and services around patients with multiple chronic conditions that can be treated on an outpatient basis,” he said.
Employment in outpatient care has grown at six times the rate of hospitals as more care is delivered in lower-cost settings, data from the Center for Economic and Policy Research show.
Home health aides are projected to be the third fastest-growing occupations in all industries, increasing 47% over the 10-year span, according to the BLS. Physician assistants are expected to grow 37%, nurse practitioners 36%, medical assistants 29%, health specialties teachers 26%, phlebotomists 24%, and nursing teachers 24%.
But despite more demand, wages for outpatient workers have fallen about 6% over the past 10 years while they have largely flattened for hospital workers who directly interact with patients, CEPR found. Part of that may reflect a rapidly consolidating industry that gives providers more leverage in setting wages, researchers said.
Another factor could be that those who have helped deliver preventative care in outpatient facilities may have been undervalued, in respect to higher-paid administrators and directors as well as clinicians who practice specialized medicine, experts said.
That dynamic will likely shift as the industry continues to adapt to treating people before they reach the hospital with an acute ailment, said Dr. Alexi Nazem, co-founder and CEO of Nomad Health, which offers a digital platform to connect freelance clinicians and providers.
“There are huge economic dysfunctions in the way the system works,” said Nazem, adding that it is an atypical market. “There are a lot of changes reflected over the last decade with the big move toward value-based payment, which will lead to a reprioritization on healthcare workforce pay away from specialty services to preventative care.”
Meanwhile, hospitals and health systems have been grappling with shortages in primary care physicians, nurses and home health aides. The country will face a nursing shortage of 1.2 million by 2022, according to the BLS. Providers have had to devote more time and money to recruiting quality employees as demand balloons.
“There is a huge attrition rate of primary care physicians, nurse practitioners and home health aide just keeping pace to replace those who are leaving is difficult,” Nazem said. “And we’re not adding enough people to meet the new growth in demand.”
Experts said that providers’ and medical schools’ renewed focus on cultivating a pipeline of quality healthcare workers will help alleviate the shortages.
Oakland, Calif.-based integrated health system Kaiser Permanenteteamed up with UC Davis to launch one of the nation’s first three-year medical school programs for primary care physicians. Students forgo summer breaks and dive into clinical clerkships at Kaiser facilities within a week of starting medical school to get them practicing sooner. The not-for-profit provider also plans to open its own medical school in 2019.
“We expect medical schools to continue to increase enrollment and add new educational forays like physician assistant programs to address the growing need for well-trained personnel,” Crabb said.
Ultimately, providers will need to pay more for primary care physicians and preventative-focused specialties, Nazem said.
“Schools play a big role but the almighty dollar speaks more than anything,” he said.
Going forward, hospitals and health systems will need to tap into the scale that technology provides to satisfy escalating demand, Nazem said.
Technology like telemedicine and artificial intelligence will complement clinicians and ease their burden rather than replace them, he said.
“The arrival of a lot of new technology will allow practitioners to engage with more patients virtually,” Nazem said. “Being able to engage with telemedicine and smart algorithms will be a huge necessity for healthcare systems at large and especially for practitioners.