More people are working in healthcare than a year ago, but recent layoffs among health systems raise questions about what comes next for the industry.
Employment in the healthcare sector was up 3.8% year-over-year in the first quarter, according to preliminary data released Friday by the Labor Department's Bureau of Labor Statistics. In ambulatory care, employment increased 3.8%, and the number of people working in home health jumped 4.8%. Employment at hospitals increased by 3.3%, according to the data, which may be revised in the coming months.
However, healthcare hiring appears to be slowing down. The industry added an estimated 33,900 jobs in March, compared with 54,900 jobs in February, according to the report.
Health systems and other providers are readjusting to the post-pandemic environment by developing new care delivery models while battling higher labor costs and supply chain issues. As a result, employers are scrambling to hire for high-demand frontline positions such as nursing, but other employees are getting laid off in an effort to trim expenses.
Earlier this week, Tacoma, Washington-based Virginia Mason Franciscan Health confirmed plans to lay off close to 400 administrative employees, or less than 2% of its workforce, citing "tremendous financial strain." Kelly Campbell, vice president of marketing and communications at Virginia Mason, said affected employees were mostly in non-patient-facing roles and the system continues to invest in its frontline workers.
Chicago-based CommonSpirit Health, with which Virginia Mason is affiliated, also hinted at pending layoffs.
"Like many healthcare providers, we are experiencing tremendous financial strain caused by a number of factors," a CommonSpirit spokesperson said Friday. "We are taking steps to improve efficiency and effectiveness that may include changes that impact roles in our divisions and at the national office, as well as reduce our costs where appropriate."
The spokesperson said the changes would not affect patient care.
Last month, Crozer Health in Upland, Pennsylvania, said it was laying off more than 200 employees, or 4% of its workforce, as part of an organizational restructure aimed at eliminating administrative overlap and cutting underused services. The system estimated it incurs $7 million in losses each month.
Roseville, California-based Adventist Health announced in February its plan to consolidate its seven care networks into five and cut dozens of positions, ranging from administrative directors to project managers.
Executive leadership roles are also in the crossfire. Novant Health in Winston-Salem, North Carolina, cut three top roles from its executive team last week: Jesse Cureton, chief consumer officer; Angela Yochem, chief transformation and digital officer; and Paula Dean Kranz, vice president of innovation enablement.