Deficits, Jobs and Health Care

Commenting on the President’s budget, an editorial in the Times on Feb 2nd juxtaposed three of our nation’s dilemmas: the deficit, jobs and health care.

“President Obama got his priorities mostly right. The deficit, compared with what it could have been, is $120B. That’s a lot of money. But it’s not too much at a time of economic weakness, when deficit spending is needed to put Americans back to work.”

“Medicare and Medicaid will cost $788B; that should be another reminder of why the country needs health care reform.”

The fundamental question about health care spending is, therefore, what does it mean for jobs?  Approximately 15 million people work in health care, and that doesn’t count jobs at the 140 companies that specialize in constructing health care facilities or 56,000 pharmacies or the dreaded health insurance companies, nor does it include all of the jobs of people supplying goods and services to the 18 million folks engaged in health care in these various ways.  But a more important question is, where is the job growth? The answer is health care. Over the past decade, the growth in health care jobs has equaled the total growth of jobs. Many are high-skilled, but many are entry-level jobs that help to move people out of poverty. So we had better be careful in measuring the impact of health care. Quite apart from its beneficial effects on well being, it just may be the engine of the economy.

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2 comments

  1. dylbeano

    while spending on healthcare may have a large multiplyer effect on jobs (through the various “supporting“ industries like pharmaceuticals, insurance, construction, etc.), I don`t think that justifies our current level of spending on healthcare, especially given the quality concerns you often note in your blog. More effective healthcare spending may indeed have ameliorative economic effects, through less lost work time, higher productivity, etc., all of which may stem from a healthier population who is more proactive about their health and have more basic services within their reach. what do you think?

    • buzcooper

      My take on it is that more health care creates jobs through economic activity. Better health care increases worker productivity by sustaining better health. Inefficient health care wastes resources. All must be considered.

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