Kansas hospitals make valuable contributions to the communities they serve. Thank you to the Institute for Policy & Social Research at the University of Kansas for producing a study on this impact. Data from the Importance of the Health Care Sector to the Kansas Economy March 2023 report is below.
Economic impact arises directly from the sales, wages and employment generated by business activity. It also arises indirectly through the effect of businesses purchasing goods and services from other local businesses and through health care workers spending wages and other income for household goods and services. These linkages tend to distribute the impact of an activity or event very broadly throughout the economy. The estimates presented represent the annual impact to the state's economy renewed each year by the continuing activity in the sector.
Source: The Institute for Policy & Social Research at the University of Kansas, March 2023
Although the connections between health care services and local economic development are often overlooked, there are at least three important linkages to be recognized. A strong health care system can: (1) help attract and maintain business and industry growth, (2) attract and retain retirees, and (3) create jobs in the local area. A vigorous and sustainable health care system is essential not only for the health and welfare of community residents, but to enhance economic opportunity as well.
Health care services employed more than 200,000 people, or 10.6 percent of all job holders in the state.
The hospital sector employed more than 72,000 people in 2021 and had an employment multiplier of 1.73 (rounded). This means that for each job created in the hospital sector, another 0.73 jobs were created in other businesses and industries in the state's economy. The direct contribution of the ore than 72,000 hospital employees resulted in an indirect contribution of more than 53,000 jobs throughout all businesses and industries in the state. Thus, the hospital sector employment had a total contribution on state employment of more than 125,000 jobs.
Using contribution analysis, we estimate that the 200,000 direct health care jobs in Kansas support an additional 100,000 jobs and $5.3 billion in additional income. The additional jobs and income arise in industries such as business services, retail trade, wholesaling, restaurants, and rentals that are connected to health care through though supply chain and consumer expenditure linkages. The 72,000 current hospital jobs in Kansas sustain approximately 53,000 additional jobs outside of health care (employment multiplier = 1.73). The $6 billion dollars in hospital wages, salaries, and benefits currently support about al $3 billion in additional earnings across the state, again outside health care industries (income multiplier = 1.48). If a single health care industry were to expand--for example, if a hospital were to add 100 jobs--we can use economic impact analysis to estimate job creation both inside and outside of health care. Continuing the example, the 100 added hospital jobs would add an additional 87 jobs in other businesses (health care and non -heath care). Similarly, the addition of $1000 in hospital wages would create $586 in other industries.
A statewide media release also is available. Please direct questions to Cindy Samuelson, Kansas Hospital Association, (785) 233-7436.
In addition to this statewide report, county economic impact reports were conducted in 2021 in cooperation with the Office of Local Government and K-State Research and Extension and will be conducted in 2023 with the Institute for Policy & Social Research at the University of Kansas, March 2023.