Health Care: An Economic Engine for Michigan

HealthcareA new study shows how health care is having a positive impact on Michigan’s economy. According to the 2013 report The Economic Impact of Health Care in Michigan issued by The Partnership for Michigan’s Health, health care is Michigan’s largest private-sector employer, directly employing 558,800 people, and pumping more than $31.4 billion a year in wages, salaries and benefits into the economy.

“Health care jobs offer higher compensation and better benefits, which is attractive to people with advanced education, skills and training,” said Peter Schonfeld, Senior Vice President, Policy and Data Services for The Michigan Health and Hospital Association.

The Partnership for Michigan’s Health consists of the Michigan Health & Hospital Association, the Michigan State Medical Society and the Michigan Osteopathic Association and works to reform the state’s Medicaid system to keep health care accessible and affordable for all citizens. The 2013 report uses 2011 data, which is the most recent available.

Health care remains on top in the mid-Michigan area (Clinton, Eaton, Genesee, Ingham, Lapeer and Shiawassee counties) with 52,770 residents directly employed by the health care sector and $1.4 billion a year in wages, salaries and benefits flowing into the region’s economy. Direct jobs are those in hospitals, physicians’ offices, nursing and residential care, home health services and other ambulatory services.

“Michigan is one of the top states in terms of medical education and training,” said Schonfeld. “Right here in Lansing, we have Michigan State University and Lansing Community College, which train many of our top physicians, nurses and other health professionals. Many of them stay and work for the state’s leading health care providers.”

According to the same 2013 report, health care jobs are less likely to be outsourced due to their geographical nature, helping to stabilize local economies. Relatively strong job growth continues for nurses, physicians and other health professionals and new health care employment opportunities are being created in biotechnology and other health care manufacturing firms.

Sparrow Leading the Way

Sparrow Health System, the region’s top private employer with a community of 10,000 caregivers, physicians and volunteers, is strengthening the economy through its commitment to innovation, quality and compassionate care.

According to John Foren, Sparrow Health System’s Communications and Media Relations Manager, Sparrow has not been affected by the ups and downs of the economy. “We are seeing shifts in employees but we are always hiring qualified individuals in all areas,” he said.

Sparrow invests in mid-Michigan through facility construction and renovation projects, which draws many indirect jobs into the area. For example, the Sparrow Neuroscience Center, which opened in August, is located on floors nine and 10 of the Sparrow Tower. “Construction for this $23 million project went on for nearly a year, providing opportunities for full-time construction jobs,” said Foren.

The Ripple Effect

Another substantial economic impact of health care in Michigan is in the buying power of the health care community, which creates a “ripple effect” throughout the economy.

“When health care workers buy homes, use banks or eat at restaurants, the money they spend goes back into the economy, thus having an indirect impact on private-sector jobs,” said Schonfeld.

When the health care community spends money on products or services, they help create thousands of additional jobs. According to the report, 37,254 mid-Michigan residents work in jobs that are indirectly related to health care or induced by the health care sector. When you add in 52,770 direct jobs, the total economic impact for mid-Michigan is 90,024 jobs.

Health care employees support our schools and public services, culture and arts programs, amenities such as parks and community centers and assist in attracting and retaining new businesses and jobs in the community.

“Anytime you have particularly strong sectors like health care in your area, you have the ability to attract additional business to the region,” said Kristin Beltzer, Senior Vice President, Government Relations and Public Affairs for the Lansing Regional Chamber of Commerce. “The impact of indirect jobs, like a financial institution that offers a healthcare division for corporate and consumer lending, will add to the growth of the local economy.”

Having a strong health care system and infrastructure is essential to the local economy. “We know that the health care sector in mid-Michigan is going to continue to thrive, providing employers and employees with quality care while acting as a catalyst for additional business growth and investment,” added Beltzer.
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