More people in the Wichita area work in health care than any field except manufacturing.
But health care has seen lackluster job growth, adding only 12 new jobs between 2013 and 2016.
That’s according to a new report for the Medical Society of Sedgwick County prepared by Wichita State University’s Center for Economic Development and Business Research.
The sector employed 40,723 people in 2016, the most recent year for which data was available. That accounts for nearly 16 percent of jobs in the Wichita metropolitan statistical area, made up of Butler, Harvey, Kingman, Sedgwick and Sumner counties.
Manufacturing accounted for 18.7 percent of the area’s employment, or 48,772 jobs.
Officials of the medical society, an organization representing the county’s physicians, said there are two ways to look at the flat job growth.
One way, said radiologist and society board treasurer John Lohnes, is the industry is not cyclical like the area’s other industries and provides a more stable base of employment.
“In terms of the regional impact and what it means to south central Kansas, it’s a steadying influence,” said Lohnes, chairman of the Wichita Radiological Group. “It’s not an area subject to wild swings like the oil industry or the aviation industry in 2001, 2009.”
A second way to look at health care is that although it is an industry that is logically expected to grow as the population grows, it faces cost pressures from government and private insurers that can affect employment.
“We would like to see more growth,” said Phillip Brownlee, executive director of the medical society. “I think there has been some factors that have contributed to that. The decision by the state not to expand Medicaid has squeezed hospitals and led to some layoffs as a result of that.”
“At least health care has been a consistent and stable employer unlike manufacturing, a leading employer,” he said. “And many of the other industries ranked higher in job growth are in smaller industries and their growth is a much smaller portion of the pie.”
By comparison, retail trade employment grew by 7. 1 percent, or 2,294 jobs, in the same period. The area’s construction employment grew 15.6 percent, or 2,203 jobs, between 2013 and 2016, the report said. Retail trade represents 13.4 percent of the area’s total employment while construction represents 6.3 percent.
Andrew Nave, executive vice president of economic development for the Greater Wichita Partnership, said because the data is more than 1 1/2 years old, it may not reflect what is happening right now in health care. He mentioned expansion at Wesley Medical Center and Via Christi hospitals as well as construction of the Rock Regional Hospital in Derby.
“I’ve seen some good signs recently,” Nave said. “Health care is just a massive part of the economy and it has its moments of faster growth.”
He said he is not concerned about the slow job growth in health care but added, “it’s one of those sectors we’re paying attention to.”
“It’s vital we continue to expand health care services and employment ... because we know to get talented folks in all industry, we need to have high quality health care.”
Brownlee said he expects the next report, due in 2020, to show more robust growth in health care.
The report also looked at the industry’s wages, which saw slightly better growth than its employment.
In 2016, the health care industry’s average annual wage of $41,843 amounted to a total payroll of $1.7 billion in the Wichita area.
Its average annual wage is below that of the average for all industries in the area, which is $42,867, the report said.
But after adjusting for inflation, wages grew 3 percent between 2013 and 2016, the report said, ranking health care seventh in wage growth among the area’s top 10 industries.
“(Health care) is one of the few areas where bottom-up growth is expected in terms of employment and wages, and top-end growth is under intense pressure,” Lohnes, the radiologist, said. “And in most cases in business, it’s a very tough place to find yourself.
“Then it comes down to what can you do more efficiently with fewer people so they are paid more.”