Nursing employment and pay increased during the recession, corroborating prior research that suggested nursing is a recession-resistant, countercyclical profession.
Are employment in healthcare recession-proof?
Is health-care unaffected by the economic downturn? Is healthcare pandemic-proof, or is that a more accurate question to ask? Surprisingly, the COVID-19 public health catastrophe has wreaked havoc on the healthcare profession in the United States. Healthcare occupations are predicted to increase at a far greater rate than all other occupations (14 percent) between 2018 and 2028, according to the US Bureau of Labor Statistics (BLS), with the healthcare sector adding nearly 1.9 million new employment. 1However, by the end of the first quarter of 2020, the healthcare industry had lost 1.4 million jobs, and actual personal consumption of healthcare services had fallen by 4.97 percent from the fourth quarter of 2019. 2 As a result of the COVID-19 epidemic, the American Hospital Association (AHA) forecasts that hospitals and health systems will lose a total of $202.6 billion in revenue between March 1 and June 30, 2020. 3 COVID-19 is the exact cause of the looming economic downturn that has thrown not only the US economy, but also the once-recession-proof healthcare business, into disarray. 4 Such an unusual circumstance necessitates an examination of how this economic downturn in the healthcare industry differs from previous recessions, as well as the extent to which COVID-19 is affecting the healthcare sector’s finances.
With almost 1.5 million COVID-19 infections as of May 2020,5 no obvious end to the pandemic in sight, and the virus’s potential reappearance in the fall and winter, it’s easy to see how such a public health disaster would be beneficial to the healthcare business. That idea, however, could not be further from the reality. COVID-19 has had an unexpected influence on the healthcare industry in the United States. This virus is innovative not just in the sense that it is (still) a mystery, but also in the way that it has caused massive economic ruin in the healthcare industry, which is a significant departure from previous decades. In the past, healthcare has mostly remained unaffected by economic downturns. 6 Indeed, some economists and healthcare professionals consider the healthcare industry to be recession-proof, owing to its ability to operate as a buffer against the usual cyclical business cycle. 7 During the Great Recession of 2007-2009, for example, the healthcare industry increased jobs (more than 850,000 between 2007 and 2010), whereas the rest of the economy lost about 8 million jobs. 9
However, healthcare has never been entirely recession-proof, that is, immune to all economic downturns.
10 The assumption that healthcare is recession-proof stems from the belief that people will still get sick and require healthcare services even during economic downturns.
11 In general, healthcare reacts to economic downturns differently than other industries. When the labor force experiences large job losses, individuals’ healthcare consumption habits begin to shift when they lose their employer-sponsored health insurance. 12 In other words, healthcare consumers (i.e., patients) decide to postpone elective surgeries until the broader economy’s outlook appears brighter. 13 As a result of this consumer behavior, the healthcare sector experiences economic downturns later than the rest of the economy, and then recovers after the rest of the economy. 14 Physicians and hospitals are the most exposed to immediate consumer spending shifts during these times, therefore they are at the most danger. 15 Furthermore, McKinsey & Company believes that during a typical economic downturn, both for-profit and nonprofit providers will experience a 30 percent decline in earnings before interest, taxes, depreciation, and amortization (EBITDA). Payors and pharmaceutical benefit managers (PBMs) are slightly less at risk, with EBITDA drops ranging from 5% to 20% and 5% to 15%, respectively. 17 Although providers, payors, and PBMs all face financial challenges during recessions, the healthcare business is rarely as affected as the rest of the US economy. 18
Healthcare has historically been less volatile than other cyclical sectors during recessions.
19 The fact that the majority of Americans have health insurance contributes to healthcare’s insulation. 20 Payors will continue to pour money into the healthcare economy, while spending in other cyclical industries dries up dramatically. 21 Older Americans, who are sicker (and hence consume a disproportionate quantity of healthcare services) and have extensive insurance coverage through Medicare, are the most frequent users of the insurance system. 22 During economic downturns, this expenditure by government payors, as well as private insurers, has been the primary source of new jobs in healthcare, which is why some economists regard healthcare as leading economic recovery because the long-term jobs produced have helped strengthen local economies. 23
While a comprehensive evaluation of the COVID-19 pandemic’s eventual estimated financial impact on providers has yet to be conducted, early information suggests a dire situation. The loss of jobs in the healthcare sector has been astonishing thus far, and the huge income loss lies behind all of the pay cutbacks, furloughs, and layoffs. 24 In the wake of the COVID-19 epidemic, hospitals and health systems are suffering catastrophic financial issues, with numerous health systems reporting revenue losses of more than 50%. 26 The AHA estimates that, after accounting for the net financial impact of COVID-19 on hospital costs, total revenue losses resulting from the cancellation of non-emergency (i.e., elective) procedures; the reduced volume of emergency room visits and hospital admissions; additional costs associated with the purchase of needed personal protective equipment (PPE); and the costs of additional compensation that some hospitals are providing to their front line workers, on average, 27 Moreover, as a result of the cancellation of elective operations, emergency room visits, hospitalizations, and surgeries have all decreased significantly. As a result, healthcare personnel who aren’t caring for COVID-19 patients are practically unemployed, which is unlike prior economic downturns. 28
The COVID-19 outbreak has also brought to light the unstable approach by which hospitals try to stay afloat. Healthcare is typically a low-margin business with large fixed costs for providers. If revenue stops suddenly, it could be (soon) terrible for operational operations. Treating patients with a fatal condition is significantly less profitable for hospitals than doing elective surgeries. 29 Many hospitals rely on elective cases as their principal source of revenue, allowing them to lose money on other services while still remaining profitable. 30
Many physician practices have experienced a similar revenue shock.
31 Some primary care practices are reporting 70 percent decreases in healthcare utilization,32 which, like hospitals, has resulted in clinical staff pay cuts, furloughs, and layoffs. 33 To prevent the risk of spreading the disease, many doctors have elected to close their offices. 34 Others that have remained open are reporting a significant drop in demand as older patients are fearful about contracting COVID-19 and other treatments are postponed due to economic instability. But, unlike during the Great Recession, another obstacle to healthcare access exists this time: rising healthcare out-of-pocket costs, particularly with regard to insurance policy deductibles, which is harming commercially insured beneficiaries. 35 Currently, 25% of private insurance beneficiaries have a $2,000 or higher deductible, which is four times the number of people a decade earlier. 36 As a result, much more than during the Great Recession, individuals who would otherwise visit a physician’s office for a visit or operation may opt out for financial reasons.
COVID-19 has drastically affected the economics of healthcare because to the rapid decline in demand for services, high expenditures (factoring in the healthcare business model outlined above and the greatly greater requirement for additional PPE and ventilators)37, and very little income coming in for providers.
38 The virus’s unique nature has caused significant financial damage to the healthcare industry, potentially leading to a recession. The indefinite length of the pandemic confirms that the COVID-19 pandemic, and the ensuing economic catastrophe, are unlike anything the United States has seen in recent memory, and the long-term financial impact on the healthcare business remains unknown.
Are nurses well-off financially?
What does it entail to work as a nurse? While there are numerous responses to this basic question, any nurse will define the meaning in their own unique way. There is no doubt that nurses contribute a lot to their communities, from caring for the sickest patients to having the opportunity to improve a patient’s entire experience.
1.There is a significant demand for nurses. Isn’t it true that there’s a nursing shortage? Is there a nursing shortage so severe that over one million nurses are required to meet the demand?
Both large and small communities are affected by the nursing shortage. There are health care establishments in your town that are looking for trained and skilled nurses to assist with patient care. The nursing shortage has become more of a worry in many facilities.
Nurses are not available in sufficient numbers to keep units staffed. The quality of patient treatment is jeopardized when units are understaffed. Facilities are so eager to hire qualified nurses that they’ve devised recruitment methods including sign-on bonuses to entice job seekers.
Nursing opportunities are plentiful around the country, giving nurses the flexibility to relocate at any time during their careers.
Why not join a career that will not only help you grow, but will also be happy to have you on board?
2. Nurses have a secure financial and professional future. Nurses are well-known for their generous annual pay. Read our most recent blog post, Nurse Salary by State: Which US State Pays Better, to learn more about nurse salaries in different states. According to the publication, a nurse’s annual compensation might be as high as $94,000. (see California statistic).
While we don’t recommend becoming a nurse only for financial gain, the nursing profession can provide a sense of financial certainty that few other professions do.
Nurses, too, have a stable and mobile employment. Ascertaining that the job path you have chosen will be able to sustain you for years to come is a vital element. Inpatient treatment will always necessitate the services of nurses. Patients, for example, interact with nurses more than they do with their doctors.
3. Nurses are regarded as one of the most trustworthy professions. Nurses placed first for the 15th year in a row in terms of ethics and honesty, according to a Gallup poll. Click here to read more about the study.
Joining such a prominent job instills a sense of self-awareness, humanity respect, and integrity (which, by the way, are three Nightingale values).
Work that you enjoy is the key to a happier existence. Despite the fact that nurses are exposed to a variety of traumatic situations, they still have the chance to make a difference in the lives of their patients. What a rewarding profession to pursue.
4. Nurses are well-liked and respected in their communities. Have you heard the various accounts from nurses about how they ran across former patients and their families and were praised for their efforts? Can you picture being thanked for assisting someone in their most vulnerable and weakest moments?
Maya Angelou’s famous comment, “As nurses, we have the chance to cure our patients’ hearts, minds, souls, and bodies, as well as our own. They may forget your name, but they will always remember how you made them feel.”
Everyone may think back on a time when they had a positive interaction with a nurse. Why not be the person they think of when they think of you? “Are you a superhero?” Capes aren’t worn by all superheroes. They wear scrubs and slip-resistant shoes on occasion.
5. Take the plunge and pursue your dream of becoming a nurse. Many people go through life without pursuing their ideal career. Why? Perhaps it’s due to the passage of time. Perhaps because of financial constraints. Perhaps they fear it is too late to pursue adventure as a second job.
Whatever the cause, set it aside and assess where you are now and where you want to go in the future. Eventually, you’ll realize that all of these reasons are really excuses for staying in your comfort zone.
Make the most of your life by pursuing a career that is both gratifying and challenging, as well as one that is always giving back.
Begin by looking for nursing schools that meet your requirements and then get started! It is entirely up to you to make your dream job a reality.
Which jobs are the most recession-proof?
8 industries with the best job security during a downturn
- Health-care services. People get sick and require medical care regardless of the state of the economy, thus the demand for health-care occupations is fairly stable, even during a downturn.
Is the recession affecting nurses?
The period 200710, which includes the Great Recession, is given special emphasis. Nursing employment and pay increased during the recession, corroborating prior research that suggested nursing is a recession-resistant, countercyclical profession.
How long does it take for a recession to end?
A recession is a long-term economic downturn that affects a large number of people. A depression is a longer-term, more severe slump. Since 1854, there have been 33 recessions. 1 Recessions have lasted an average of 11 months since 1945.
Are nurses wealthy?
Nursing does, without a doubt, give a solid, steady income. But, with a new RN’s median income at about $64,000, I’m guessing what you’d respond if someone asked, “Are nurses rich?” After all, you’re probably able to pay your expenses, pay down debt gradually, and take a vacation every now and then.
That isn’t precisely what many people consider to be a wealthy amount of money. How could a nurse on a nurse’s salary even consider getting wealthy? Isn’t it true that this isn’t possible?
This post is for you if you’re a nurse who wants to discover how to make money as a nurse. Today, I’m going to give you some advice on how to make wise financial decisions so that you may get the most out of your nurse’s pay.
Are nurses paid more than doctors?
In fact, according to a data from the Bureau of Labor Statistics, doctors often earn around $200,000 per year or more. Nurse practitioners, on the other hand, make an annual salary of $111,840.
Why are nurses so well compensated?
Nurses, like many other healthcare workers, earn a lot of money. This is why you should apply to a college with an excellent nursing program if you want to earn between $53,410 and $116,230 a year after graduation.
It’s no surprise that nurses are paid so much for their various responsibilities, which include assessing patients’ illnesses, giving medications, and educating families and the community. Nursing school requires a lot of hard work as well, which is why nurses are deserving of higher pay.
Before we go any further, let’s clarify one thing: there are various types of nurses. Certified nursing assistants (CNAs), licensed practical nurses (LPNs), and licensed vocational nurses are just a few examples (LVNs).
This page focuses on registered nurses, who come in a variety of shapes and sizes, including emergency department nurses, critical care nurses, surgical nurses, cardiovascular nurses, psychiatric nurses, and so on.
They all have the word “registered” in their titles, indicating that they have passed the National Council Licensure Examination.