May 6, 1999 (The Editor’s Desk is updated each business day.)

Health employment not as strong as it used to be

Until the late 1990s, health employment had been a growing share of the private economy. While health services remains among the small group of industries that add large numbers of workers almost every month, employment growth has slowed recently.

[Chart data—TXT]

Although managed care and other cost control strategies were in place by 1992, the impact on employment was limited in that year. Since then, employment growth in health services has slowed. This is in sharp contrast to an acceleration of employment growth among many other services industries.

As the growth rate of health care expenditures has slowed, so has growth in health services employment. Managed care and strong competition have caused a restructuring of the health industry. These changes led to a reduction in inpatient hospital stays and resulted in sharply slower growth of hospital employment. The average annual rate of growth in hospital jobs was 3.6 percent from 1987 to 1992; from 1992 to 1997 it was 0.6 percent.

These industry employment data are a product of the Current Employment Statistics program. For more information see "Health services industry: still a job machine?" Monthly Labor Review, March 1999.