July and August job numbers combined to give the healthcare industry its best two-month employment increase since 2020, and total employment now sits 3.2% above pre-pandemic, Altarum wrote in a recent analysis (PDF) of federal economic indicators.
The two months’ combined for 143,900 added healthcare jobs, which ambulatory care led with 77,700 adds while hospitals brought 30,600 more. Those numbers represent initial August tallies and the government's revised numbers from July, per the report.
Ambulatory care settings now employ 7.8% more people than pre-pandemic while hospitals employ 2.1% more. Nursing and residential care settings, however, are 5.7% below February 2020.
Though higher than the private sector for much of 2021 and 2022, year-over-year wage growth within healthcare dipped below the total private sector’s wage growth in recent months. Compared to the private sector’s relatively flat 4.4% growth, healthcare wage growth has steadily declined to 3.3% as of July. Growth was the lowest within ambulatory care (2.8%), followed by hospitals (3.8%) and nursing and residential settings (4.3%).
Other analyses accompanying the labor numbers outlined a slight uptick in national health spending that somewhat lags national gross domestic product (GDP) growth.
Year-over-year national health spending grew 5.7% as of July, up slightly from 5.3% in June and below nominal GDP’s concurrent 6.5% rise, per federal data cited by the nonprofit. Disregarding government subsidies, July’s year-over-year home healthcare spending grew 12.3% while hospital care rose 6.7%.
The increase in year-over-year health spending was fueled more by an uptick in utilization than price growth, Altarum wrote, though both of those latter indicators leveled off somewhat in recent months.
The overall Health Care Price Index’s year-over-year growth inched down from July’s 2.9% to 2.8% in August, both of which are below the Consumer Price Index’s 3.7% in August. The latter number represents a relatively narrow gap between healthcare price growth and economywide inflation, a pairing Altarum’s analysts said they believe will get tighter in the coming months.
Prices for nursing home care, dental care and home healthcare grew fastest in August, while physician services prices remained near flat at just a 0.6% year-over-year rise. Private payer price growth also slowed and looks to be aligning with public payers’ numbers, according to the report.
Meanwhile, Altarum’s overall healthcare utilization metric saw another month of slowing growth and now sits at 4.3% year over year versus the 5.1% of February and March.
“This result matches other data on national healthcare utilization, such as data on overall hospital volumes from July, and indicates trends in overall health care utilization may be tending slower in 2023,” the group wrote.