Employment in hospitals: unconventional patterns over time

William C. Goodman 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. The trends of employment in hospitals therefore 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. In relation to the business cycle, job growth in hospitals is greater when gross domestic product (GDP) is weak, when unemployment is high, and when overall hiring declines. This article first takes up influences other than the business cycle and then explains the countercyclical pattern of growth in employment. One cyclical influence in particular— variations in the labor shortage in the industry—is examined in detail. In this article, the Current Employment Statistics survey1 is the primary source of statistics representing employment. Two particular time series from the survey are emphasized. One represents employment in all hospitals, including private and Federal, State, and local government establishments.2 The other represents employment just in privately owned general medical and surgical hospitals (NAICS 6221). The latter series offers a longer history, since 1958; the former starts in 1990. The more restricted series, then, can be used for longer term analyses. Whenever possible, however, the broader hospital series is used to generate conclusions about the entirety of the hospital industry, both public and private.