Healthcare employment continues rising in the state, though economists are still unsure what precisely drives that growth to the levels observed.
A state Bureau of Labor Statistics report released in May detailed that the Anchorage’s healthcare employee ranks rose by 1,000 year-over-year. This high number could be a data flub, but it is consistent with the projections that Alaska’s healthcare industry will continue its status as the largest job growth sector in the state. Despite links to population patterns and increased usage, state economists say healthcare industry job growth has an unknown, unquantifiable variable that contributes to Alaska’s perpetual industry growth.
“It is interesting to note that healthcare employment in May grew by 1,000 jobs compared to May, 2015,” reads the report. “It is unclear what has driven this sudden significant jump in healthcare employment and may be a data anomaly. This is a preliminary figure and subject to revision in next month’s report.”
An Anchorage Economic Development Corp. forecast expected only 300 jobs in 2016.
“The health care sector is expected to add 300 jobs in 2016, up 1.6 percent, to a total of 19,100 jobs,” according to the forecast. “This matches the estimated 300 jobs added in 2015.While health care employment has been on a growth trend for more than a decade, the rate of growth has been slowing since 2012.”
Healthcare has long been one of the steadiest growth industries in the state. Healthcare employment has more than doubled in Anchorage since 2000, rising to 19,500 by the end of 2015. Statewide, just less than 35,000 healthcare workers call Alaska home, nearly double the amount than in 2000, according to the studies.
Apart from being the largest industry growth sector, Alaska healthcare employees also earn the biggest paychecks in the state.
According to data compiled from the Bureau of Labor Statistics, eight of the 10 top paying positions in the state are healthcare positions. Family and general practitioners get paid the most in Alaska, with an average annual salary of $235,600. Psychiatrists and obstetricians rank second and third with average annual salaries of $234,130 and $221,480, respectively.
Nurse practitioners are the 26th highest paid group in the state with an average salary of $117,080. Registered nurses are the 77th highest, with an average salary of $88,510.
Employment numbers rise in Alaska for a host of reasons, but none entirely explain why they continue to grow as fast as they do, according to economists. A few factors in particular could drive growth, including aging populations and changes in state healthcare policy.
Typically, healthcare employment growth follows aging population growth, according to State of Alaska economist Caroline Schultz, who crunched the study’s numbers.
“Historically it’s been linked to 65 and older population,” Schultz said. “Our aging population is growing very quickly because we had a younger population than the nation as a whole. In a lot of ways we’re kind of playing catch up.”
In 2000, Alaska had 626,932 residents. In 2015, the number had grown to 737,625 and the 2015 AEDC economic forecast is for Alaska’s population to grow by 10 percent between 2012 and 2022. During the same period, however, Alaskans aged 65 and older will increase by 79 percent.
While other job sectors are taking a hit due to Alaska’s fiscal situation and declining oil prices, healthcare demands don’t have the same dynamic. The state looks to healthcare along with retail as bright spots in an otherwise gloomy job growth outlook.
“In most situations, demand for healthcare is pretty inelastic,” said Schultz. “We expect that healthcare will be one of the last industries hit.”
Becky Hultberg, executive director of the Alaska State Hospital and Nursing Home Association, said unpredicted increases in health care employment could be related to a bump in hospital usage over the last year, driven by an increase in coverage demographics.
Gov. Bill Walker expanded Medicaid coverage to an additional 20,000-odd Alaskans by accepting federal funds via an executive order in July 2015. Hultberg said pent up demand could be responsible for more medical treatment and the medical workers needed to give it.
“We’re seeing very high hospital census numbers,” Hultberg said. “Hospital beds are full. Census numbers are trending high, at least in the Anchorage bowl. It’s not clear why those numbers are so high. It could be again population. It could be Medicaid expansion. It’s most likely related to demographics.”
Hultberg said hospital utilization rose last summer due to drug-related emergencies, and the number haven’t dipped to their pre-spike levels.
“There was an increase utilization in the spice epidemic,” said Hultberg. “Those numbers haven’t slid back down. I don’t know I can highlight what’s going on.”
Hultberg said the rise in hospital usage will naturally affect the workforce, but it doesn’t coincide with a targeted recruitment campaign.
William Smith, vice president of human resources at Alaska Regional Hospital, said he doesn’t have the data for why hospitals have higher usage numbers, but that the higher patient census is opening up more positions at his hospital.
“That’s definitely affecting openings,” Smith said. “It’s creating great opportunity for recruitment.”
Healthcare employment numbers are expected to be the largest job growth sector well into the 2020s as the population ages.
Schultz believes increasing health care employment could simply be part of Alaska’s development process. With a substantial portion of the population out of reach of common healthcare options and a difficultly attracting and retaining workers, Alaska may be slowly coming to match per capita healthcare employment elsewhere.
“We’ve essentially been underserved. We are just catching up to the level of healthcare people expect elsewhere,” Schultz said.
As recently as 2014, however, the per capita representation of Alaska healthcare workers was more than the national average.
In 2014, there was approximately one U.S. healthcare worker per every 26 U.S. citizens, according to census records. In Alaska, the records show one healthcare worker per every 21 Alaskans.
“We don’t know exactly the answer,” said Schultz. “What’s the right level of healthcare in Alaska? That’s something we don’t really know.”
• DJ Summers is a reporter for the Alaska Journal of Commerce. He can be reached at daniel.summers@alaskajournal.com.
