New England Ranks First in Concentration of Health Care Employment in the U.S. but Last in Employment Growth.

Business Editors and Health/Medical Writers

CAMBRIDGE, Mass.--(BUSINESS WIRE)--Feb. 18, 2003

Research from the New England Healthcare Institute Warns that the

Vitality of the Health Care Industry in New England is Threatened

New England ranks number one among nine U.S. regions for the percentage of people directly employed in the health care industry but last in the U.S. in employment growth within the industry, according to a study released today by the New England Healthcare Institute (NEHI). The study found that five of the six New England states (Massachusetts, Rhode Island, Connecticut, Maine and Vermont) rank among the top 10 states in the U.S. for the percentage of workers employed in health care fields. Approximately 11.4 percent of New England's workforce is directly employed in health care professions, accounting for more than 800,000 jobs.

The study, conducted for NEHI by the Milken Institute, also examined the indirect impact on the regional economy and found that 25 percent of New England's workforce is employed today as a result of the health care industry, which translates into approximately 1.7 million jobs. In addition, a total of $53 billion in revenues is directly generated by health care-related businesses in New England.

"The health care industry is the backbone of the region's economy," said Wendy Everett, President, NEHI. "That said, our research shows that this industry is stagnating when compared to the rest of the country and if the public and private sectors in every New England state don't work together to foster growth, the industry and local economies could find themselves in critical condition."

The study found that New England is losing ground when it comes to health care job growth and in retaining related manufacturing operations. New England health care employment from 1996 to 2001 grew six percent while the fastest growing region - the Mountain states - grew 16 percent. The study examined the change in employment concentration from 1996 to 2001 and found that Boston is falling behind other major metro areas. Chicago ranked first with a nine percent increase in employment concentration while Boston had a decline of approximately five percent.

New England is currently a world leader in health care research and innovation based on levels of NIH funding, industrial R&D data and venture capital funding of biotechnology and medical devices companies.

Other notable findings:

-- Health care stimulates significant job creation for the region; for every job in the New England health care industry, an additional 1.15 jobs are created through indirect and induced impact

-- For the past 15 years, there has been a steady decline in New England's share of total U.S. health care employment

-- Massachusetts accounts for approximately 50 percent of total direct health care employment in New England

-- Boston is first among national metro regions in health care, but New York, Philadelphia and Chicago are close behind

The study, entitled, "The Economic Contributions of the Health Care Industry to the New England Region" is the first of four research projects NEHI will undertake in 2003.

About NEHI

Founded in 2002, the New England Healthcare Institute (NEHI) is a regional, applied research, health policy institute focused on enabling innovation in health care. NEHI's membership represents all sectors of the health care industry, including members of the biotech, pharmaceutical, medical device, hospital, physician, employer, and insurer communities. NEHI is dedicated to identifying, analyzing and solving critical health care challenges facing the people of New England. For more information please visit www.nehi.net