July 05, 2006 (The Editor’s Desk is updated each business day.)

Employment trends in hospitals

Employment in hospitals is subject to influences that are not related to the business cycle and responds to the business cycle in an unusual way.

[Chart data—TXT]

The trends of employment in hospitals therefore often contrast with those of total employment, especially during cyclical downturns. Apart from the effect of the business cycle, demographic and technological changes influence hospital job growth in both upward and downward directions.

Although employment in the hospital industry has increased almost constantly since 1990, changes in its rate of increase are opposite to those of gross domestic product (GDP) and of total payroll employment. Furthermore, when unemployment rises, so does the rate of job growth in hospitals. While the trend of employment in all hospitals is consistently upward, the rate of growth may be described as countercyclical: when general business conditions are weak, hospital employment exhibits greater growth.

These data on employment are from the Current Employment Statistics (CES) program. For more information, see "Employment in hospitals: unconventional patterns over time," by William C. Goodman, Monthly Labor Review Online.