By Margot Sanger-Katz

If you want to understand a big part of the recent economic recovery, think about health care. Take a look at this chart:

Over the past five years, as employment tanked and then weakly recovered, jobs in the health care sector have grown at a steady clip. That’s good news for the economy (at least short term) and very good news for certain communities where the health sector led to economic growth. In many communities, hospitals and health centers have become dominant employers with a key role in the local economy – and local politics.

But ever-growing health employment may be coming to an end, as I learned when I reported on the health sector’s impact on the Pittsburgh economy as part of a yearlong Reporting Fellowship on Health Care Performance sponsored by AHCJ and supported by The Commonwealth Fund.

Many of the goals of Health Policy – more efficient care, reduced growth in health spending – are going to slam up against the historic trend of more and more health jobs. Health Policy also is likely to drive a shift in the kind of health jobs – fewer highly paid positions at the top of the food chain, and more lower-wage jobs in home health care, case management and the like. The changing health workforce is a key part of the story of Health Policy, and it hasn’t yet been well told.

Our country’s growing health sector also can be a drag on other parts of the economy, pulling down wages, increasing business costs, and draining municipal and state budgets – not to mention the federal one. The very reason that Health Policyers were so focused on “bending the cost curve” was a recognition that health spending can’t keep rising without crowding out other sectors of the economy. Health care is labor-intensive, so labor costs represent more than half of all health spending, and that likely will continue.

Current and coming deficit reduction out of Washington will also squeeze the dollars fueling health care jobs. That means cuts from Medicare and Medicaid, as well as grants from the National Institutes of Health and the Centers for Disease Control and Prevention and other agencies. The recent across-the-board budget cuts known as the sequester hit medical research and public health particularly hard. If Congress and the president ever get around to compromising on a big deficit reduction deal, hundreds of billions of dollars will be cut out from future Medicare spending, cuts that come on top of Affordable Care Act reductions that already have many hospitals tightening their belts.

Health employment is a national story, but it is also a very local one. Here are some things to look at:

1. How much does your local hospital dominate the employment landscape? Any employer that produces the bulk of a community’s jobs needs to be covered like any other big business in town, even if they like to cast themselves as altruistic actors offering community benefits.

2. How does the dominance of health care entities – particularly nonprofit hospitals – influence your community’s local budget? Many hospitals pay no or little property taxes, which can erode the local tax base. Many communities are experimenting with so-called “payment in lieu of taxes” to recoup some of that lost revenue. But in many other communities, hospitals bring jobs and economic growth at the expense of direct municipal investment. That can mean strapped schools and infrastructure and political conflict. Some resources:

   Reporter chases down cost of new tax break for investor-owned hospitals
   Reform will require nonprofit hospitals to assess charity care; reporters can evaluate it now
   Reporting on the business of health care

3. Where are the big health job demands, and what is your local supply? Is your hospital hiring a lot of temporary traveling nurses? Is the community college expanding its radiology tech program? How old is the workforce in various job categories? Health job training can improve economic opportunity for young people. Inefficiencies in workforce supply can drive up local costs. The hospital’s head of human resources can be a good first stop on these questions. As can community college presidents.

4. How good are the health care jobs available in your community? Do they pay a living wage? Do they offer decent health and other benefits? Unions are increasingly moving to organize health workforces (who ironically don’t have health care – although that will change for many of them in 2014). They can be good resources on how health providers perform as employers, and whether their benevolence is declining. (Some are great. Health care employment tends to offer the kind of opportunities for upward mobility and lateral career change that are fading from other industries.)

5. Write about the turf wars over scope-of-practice laws. A growing demand for primary care and downward pressure on health spending both point towards a need for more “mid-level providers” who can perform some traditional functions of doctors with less training and at lower cost. Who can do what under what sort of supervision is determined at the state level. And top providers tend to be protective of their market share and concerned that professionals with less training will jeopardize patient care. Look at what nurses, PAs, pharmacists, dental hygienists and others are asking for from the legislature and whether they will get it. For some background on these scope-of-practice issues, see:

   ‘Scope of practice’ stories vary according to state laws
   Stories on changing role of nursing illustrate ‘scope of practice’ issues
   Shortage of oral health care fuels debate over scope of practice

6. Home health care is the fastest-growing segment of this fast-growing industry. There are so many stories here. Home health is going to become increasingly important if our system is going to move away from expensive hospital care and towards the kinds of low cost prevention and monitoring that can help frail patients avoid medical calamity. But home health workers are often poorly paid and low-skilled. Many are immigrants.

7. Think of health care jobs broadly. Increasingly, the health industry is relying on computer scientists, accountants, and finance experts. A lot of important health jobs are far from the bedside.

Most of these stories will depend on local sources, but here are a few national resources:

The Bureau of Labor Statistics puts out jobs numbers every month, with breakouts on the health job sectors that are growing and some regional trend data. The Altarum Institute, a Michigan-based think tank that has recently grown in DC too, also does great monthly analysis on health employment.

There are a couple of groups that have done big workforce analyses lately, and there is some dispute in the field over how many health care workers of various sorts we will need. Recent work from the Bipartisan Policy Center surveys the research and can direct you to several profession-specific studies.

The SEIU is the union with the largest health care focus, but it is not the only union trying to organize health workers.

National trade groups for mid-level providers (nurse practitioners, dental hygienists, and PAs, for starters) can help you know how your state compares to others. But local advocates and legislators are probably your best source on moving legislation.

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Margot Sanger-Katz is a health care correspondent for the National Journal in Washington, D.C. As the recipient of an AHCJ Reporting Fellowship on Health Care Performance, she produced a series of stories examining the growing pattern of hospital consolidation and its influence on health care costs and the future of Health Policy.