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Careers in health care have long been seen as sure bets, especially given growing numbers of older Americans. Thereâs fresh evidence, courtesy of Stanford economist Neale Mahoney, for just how much those jobs are paying off.
For instance, earnings for U.S. health care workers as a group have risen almost twice as fast as those in other industries, based on data spanning more than four decades. In 2009, the American health care sector overtook retail as the countryâs largest source of jobs.
Hereâs another revelation from the new working paper by Mahoney, the Trione Director at the Stanford Institute for Economic Policy Research (SIEPR) and economics professor in the Stanford School of Humanities and Sciences: Despite talk of U.S. cities hard hit by manufacturing declines pivoting to health care to boost local employment, Mahoney and his co-authors find that itâs not happening as hoped. Health care jobs have only slightly offset job losses in manufacturing â and not at all among workers who arenât white and for those lacking college degrees.
Other takeaways from the study of U.S. Census data from 1980 to 2022:
- Wage hikes in health care havenât benefited workers equally. The big winners relative to the rest of the U.S. labor force have been middle-class and upper-middle class health care employees. Compensation for nurses, for example, have risen approximately 82 percent, compared to nearly 37 percent for all U.S. workers.
- Physician assistants, nurse practitioners, and other so-called âmidlevelsâ provide more than half of primary care services in the U.S. Since 2010 â when the job category became large enough to track consistently â the number of midlevel positions has more than doubled. There are now more midlevels than primary care doctors in the U.S.
- About three-quarters of health care jobs are held by women, a level unchanged since 1980. Whatâs different now is that there are three times as many female physicians than there were four decades ago (though male doctors remain the majority). The share of males who work as nurses and aides has also increased.
- The proportion of physicians and aides born outside the U.S. has grown at a faster rate than it has for foreign-born workers generally. The share of foreign-born nurses and midlevels, meanwhile, has grown at smaller rates than the economy-wide average.
Overall, Mahoney and his collaborators â Joshua Gottlieb of the University of Chicagoâs Harris School of Public Policy; Kevin Rinz of the Washington Center for Equitable Growth, and Victoria Udalova of the U.S. Census Bureau â say the study findings have important policy implications.
Health care, the study authors write, has been one of the largest trends in the U.S. labor market in a generation â and a âmodern middle-class âjobs engine.ââ
Why that engine hasnât reached economies hit hard by manufacturingâs decline, the researchers say, could be because âmanufacturing-to-medsâ policy proposals havenât received the necessary resources or, if they did, they have not produced the desired results.
âNow that we have a clearer reading on whatâs happening in the health care job market,â Mahoney says, âunderstanding whatâs behind the trends will be crucial as the industry continues to expand and technology changes.â