Health Care Will Only Crowd Out Other Employers If We Don't Need Health Care Jobs
|Thursday, 18 August 2011 08:29|
The NYT had an interesting, if somewhat confused, piece on whether the health care sector will continue to be a reliable source of job creation. The piece notes that the health care sector has been the one major sector that has consistently added jobs since the beginning of the downturn, however it notes that cost pressures are likely to slow the rate of employment growth in the future.
The article concludes with the comments of Joshua Shapiro, chief United States economist at MFR Inc.:
"If spending on health care continues at its current pace, it will choke out other vital sectors and end up hurting the rest of the economy, ... I think the path that we’re on now is clearly unsustainable.”
This statement is somewhat misplaced in the article. As long as we are in a period of high unemployment, then the health care industry's growth will not be constraining growth elsewhere in the economy. This would only be an issue if we have returned to something close to normal levels of employment. Of course if we have returned to normal levels of employment, then we won't be dependent on the health care sector to provide jobs.