It's been a little over a year since Ascension, the nation's largest Catholic healthcare system, announced it would join a handful of large corporations in raising its minimum wage to $11 an hour.
As we plow through this summer of our political discontent, it's worth revisiting the issue of stagnant wages, since I believe it is stoking much of the anger propelling the candidacy of a man clearly unqualified to be president of the United States.
The harsh reality of modern-day America is that the less-educated, hourly workforce is falling further and further behind those still clinging to middle class status and above.
This is not a white, black or brown issue. This is a fairness issue that today characterizes almost every sector of the U.S. economy—including healthcare. Virtually all of the gains in income over the last few decades have gone to people at the top.
The 1% versus 99% meme that motivated the Occupy Wall Street protesters a few years ago and found political expression in Vermont Sen. Bernie Sanders' campaign for the Democratic Party presidential nomination doesn't begin to capture a phenomenon taking place in almost every industry—again, including healthcare.
Better-educated and -credentialed professionals are seeing OK wage growth. But nonsupervisory workers who draw an hourly wage and work in the fastest-growing occupations in healthcare in the U.S. are standing still where they aren't falling behind.
I spent a few hours recently reviewing labor market data available from the Bureau of Labor Statistics to see if the sector we cover was immune from the broader trends in society. Despite a job growth rate that was four times greater in healthcare than the overall economy over the past decade (though about the same since the trough of the Great Recession in 2009), the wages of many healthcare workers are falling behind—behind inflation; behind better-educated colleagues in healthcare; and behind the overall private-sector workforce.
Here are the numbers. Between December 2009 and December 2015, healthcare added 1.6 million new jobs, a growth in total employment of 12.1%. That was just below the growth rate for the overall private sector, which added 13.8 million jobs (the number ballyhooed by President Barack Obama).
Fully half of the healthcare job growth came in just two sectors: home healthcare services, which added 300,000 jobs; and services for the elderly and disabled, which added just over half a million jobs. Befitting an aging society with a changing healthcare delivery service mix, those two sectors now account for 1 in 5 healthcare jobs, up from 1 in 8 just a decade ago.
Those services aren't reimbursed very well by Medicare, Medicaid or private insurers. That's why those industries don't pay very well. The average weekly wage for hourly workers in home health and elderly services was $488 and $349, respectively, at the end of 2015.
And they're falling behind. Growth in their average weekly wage over the last decade has lagged well behind the rest of healthcare and the rest of society. Home health workers have seen an average annual wage increase of just 1.3% since 2006. Workers in nursing homes, whose job totals are stagnating, grew at just 1.7%. Those delivering services to the elderly and disabled have actually seen a slight pay cut.
That's right. Their average weekly wage of $349 at the end of last year for healthcare's fastest-growing sector was $2 a week less than what workers made in 2006. And that's without adjusting for inflation.
Nonsupervisory workers in hospitals and physician offices received higher-than-average raises over the last decade. But those numbers were skewed by the increases received by well-educated professionals. Support staff in those institutions didn't do quite as well.
The howl of outrage represented by the candidacy of Republican standard bearer Donald Trump will not be quickly forgotten. It's time for healthcare system leaders—like the rest of the nation's private-sector employers—to begin talking about what can be done to redress the wage stagnation afflicting their less-educated, poorly paid but hard-working employees.
