Don't blame healthcare for May's poor jobs report.
The healthcare sector added 46,000 jobs in May, more than the disappointing 38,000 jobs created by the rest of the economy combined, according to Friday's jobs report from the U.S. Bureau of Labor Statistics.
The healthcare sector added 24,000 jobs in ambulatory services, 17,000 at hospitals and 5,000 at nursing care facilities. Healthcare has been a jobs driver throughout 2016. The report noted that through May, healthcare employment has increased by 487,000.
There's another silver lining for healthcare. The paltry jobs report reduces the likelihood that the Federal Reserve will raise bank borrowing rates this month above the current historically low .25% to .5%.
Hospitals and other healthcare companies rely heavily on debt financing for expansion. The low Fed rates make it less expensive for them to fund their capital needs.
The national unemployment rate fell, despite the jobs performance, to 4.7% in May from 5% in April. That's largely because more Americans dropped out of the workforce.
Employment in other major industries, including construction, wholesale trade, retail trade, transportation and warehousing, financial activities, leisure and hospitality, and government, changed little over the month, the BLS said.
The nine hospital stocks that comprise the Modern Healthcare Hospital stock index fell about 1% Friday, giving back all of the gains they made earlier in the week.
The NYSE Healthcare Index, which includes a broader group of healthcare stocks including insurers and medical device makers, gained 1% this week, while the S&P 500 Health Care Index gained about 1.5%.
The biggest loser on the Modern Healthcare stock index Friday was Tenet Healthcare. The Dallas-based hospital chain saw its stock price drop about 3% to close at $28.91.
Community Health Systems also declined Friday. Its price dropped another 2% to $13.75.