Job cuts in July ran deep in the healthcare industry due do the sequester and healthcare reform, according to the latest monthly job cut report released Thursday by Challenger, Gray & Christmas, Inc.
The healthcare sector led July workforce reductions with 6,843 planned job cuts--the highest number of cuts in the industry since November 2009 when it slashed 9,558 jobs. According to the report, healthcare organizations have now cut 29,794 jobs this year, 59 percent more than the 18,770 planned job cuts announced by this point in 2012.
"Cuts in Medicare reimbursements brought about by sequestration and healthcare reform are hurting hospitals' bottom line," said John A. Challenger, CEO of the global outplacement consultancy firm. "Some states are also cutting Medicaid funding, which adds to the financial challenges."
Challenger also said hospitals are reporting fewer patients as high-deductible insurance policies discourage would-be patients from seeking health services. "As a result of these factors, healthcare providers, which had been one of the country's best job generators in recent years, are being forced to reduce their headcounts," he said.
The findings echo reports in May that nationwide hospital jobs declined by 5,900. Despite the severe job cuts, hospital CEO pay continues to rise, FierceHealthFinance previously reported. For example, in Connecticut, 18 hospital CEOs received compensation of more than $1 million a year. "Hospitals, like all organizations, need the right leaders to succeed," Michele Sharp, spokeswoman for the Connecticut Hospital Association, told the Connecticut Post at the time. "To attract the leaders they need, they pay at market-competitive levels, just as they do for all employees."
- read the announcement about the report