PITTSBURGH, February 25, 1998 — More than one out of every 10 people in the Pittsburgh region is employed in health care. In fact, health care systems are among the largest employers in the region.
With much of the region’s livelihood dependent upon the health care industry, policy makers have relied on hospitals and research centers to foster employment growth. But the advent of managed care and advances in medical practice have changed the health care industry and slowed the employment boom that characterized health care in the 1980s.
A report issued this week by the Health Policy Institute (HPI) at the University of Pittsburgh’s Graduate School of Public Health (GSPH) has found that between 1994 and 1996, more jobs were lost in hospitals than were created in other health care settings such as home care, nursing homes and physician offices. The report is the first to analyze health care employment data for each county in the Pittsburgh region. "The loss of jobs comes at a crucial point in the Pittsburgh region’s development," commented Jeanne Black, M.M., associate director of the HPI and author of the report. "Policy makers in Pittsburgh are faced with the pressure to spur economic development and create jobs for this region. One of their strategies in doing that is to reduce health care costs faced by employers. However, they also need to understand the impact on health care employment.
"Although some health care opportunities are shifting out of urban hospitals into other health care settings elsewhere in the region, in Allegheny County there are not enough new jobs being created to compensate for the cutbacks in hospital employment," remarked Ms. Black. "This shift also impacts the wages and benefits of health care workers."
Most positions in a non-hospital setting pay lower wages and offer fewer benefits than those in a hospital. For instance, aides in nursing homes made $3.75 per hour less than their hospital counterparts, according to a national study cited in the report.
"The greatest impact is felt for lower income workers and minorities," commented Ms. Black. Nationally, one of every 10 African American woman is employed as a health care aide, housekeeper or food service worker. Non-hospital settings require fewer support staff. Health care aides and nurses who do not have access to reliable or convenient transportation to suburban areas may not be able to obtain re-employment in home care or physician offices.
There is no indication that the shifting of jobs from urban hospitals to non-hospital settings will cease anytime soon, said Ms. Black. The region has too many hospital beds and high health care expenditures, both exceeding the national averages. In fact, data collected by Ms. Black through 1997 but not published in the report, show 2,000 more hospital jobs were eliminated in Allegheny County, bringing the total reduction since 1994 to 6,500.
"We need to provide re-training for these displaced health care workers and monitor the effects of these employment trends on minority workers and disadvantaged communities," stated Ms. Black. "If a corporation or manufacturing firm announced a layoff of thousands of workers, state and federal funds would be mobilized to provide retraining and placement programs. We have more than 6,500 displaced health care workers in Allegheny County, and we need to determine what can be done to help them."
As part of the HPI study, Ms. Black surveyed more than 90 individuals involved in the Pittsburgh region’s health care industry. These included representatives from community organizations, physicians, health care consultants, academics and executives in health care organizations.
Most of the survey respondents anticipated that many hospitals in this region will close within the next 10 years. However, Ms. Black has suggested an alternative scenario. Citing that the most financially troubled institutions already have joined with the region’s largest hospitals, she predicts most hospital facilities will continue to operate, but with fewer beds, different services and different organizational alliances.
Established in 1980, the Health Policy Institute conducts analyses and studies to help inform and shape policies and decisions that influence health care in the region. To obtain a copy of this report, please call Linda Kalcevic at 412-624-6104.