Health-Care Industry Leads GDP Growth Here and Nationwide

YOUNGSTOWN, Ohio — The numbers are staggering. Since the start of the century, no other industry in northeastern Ohio has seen the gains that the health-care sector has. In terms of GDP growth, it’s up 37% since 2001, about 2½ times the state average, to $22 billion. Last year, more than 270,000 were employed in health-care jobs.

Imagine everyone in the cities of Youngstown and Akron – man, woman and child – working in one field. You’re still about 8,000 people short of the employment total in the 18-county region. 

“This is a large – very large – industry. $22 billion is huge. It’s probably a larger number than 

the average person can appreciate,” says Tom Humphries, president and CEO of the Youngstown/Warren Regional Chamber. “But when you look at how many people that supports, it’s huge.”

In December, economic development agency Team NEO released its quarterly economic review, focusing on the health-care sector. The agency, based in Cleveland, examined information from the U.S. Bureau of Labor Statistics, Ohio Department of Job and Family Services and Moody’s Analytics to put together a picture of how the industry has grown over the past two decades.

Whereas other industry sectors have largely held steady or slipped since the start of the century, health-care has been the one to gain – and gain big.

“One of the most important things for our region is that manufacturing output and productivity has continued to grow, but we’ve seen a significant decline in manufacturing [employment], around 30%,” says Jacob Duritsky, vice president of strategy and research at Team NEO. “The health-care growth is the one sector that’s offset those losses. It’s been meaningful to keeping our economy churning along through two major recessions.”

In the 18-county region Team NEO works in – from the shore of Lake Erie south to Tuscarawas County and the Valley in the east to Erie, Huron and Richland counties to the west – the health-care industry is driven largely by anchor institutions such as the Cleveland Clinic, Akron Children’s Hospital and University Hospitals. Those organizations provide northeastern Ohio with something few other areas have: health-care jobs that aren’t tied to service. 

In most areas across the United States, health care is an industry built around providing service; someone feels sick, he goes to his doctor or the hospital, gets treated and goes on his way. 

Because of anchors such as the Cleveland Clinic, northeastern Ohio has developed an ecosystem of companies that work alongside health-care providers, such as companies in the biomedical and pharmaceutical fields. 

Over the past five years, the Team NEO report says, 50 health-care-related companies have expanded or relocated to the region, including the The Smithers Group’s $22 million 

renovation of a six-story office in Akron to house its new headquarters. The site will create 84 jobs and retain 145.

“It’s not just a population-serving sector. … You see it in Boston and you see it in Minneapolis where there are big institutions,” Duritsky says. “They’re companies like Gojo, which makes products for in-hospital use. Those have significant multiplier impacts. When you see people leveraging the health-care base and investing in biomedical for new products and technologies, those have tremendously higher spinoffs.”

Whereas a typical hospital job might create half or two-thirds of another job, the multiplier for employment in biomedical or pharmaceutical fields can reach as high as two other jobs. 

And not all direct jobs are medical, Duritsky notes. Large health-care systems have their own IT departments, maintenance divisions and some, such as Mercy Health, police departments.

“When you have institutions employing tens of thousands of people in some cases, 40% or 50% might be dedicated to health care, but you also have scientists, police, legal teams, accounting teams, massive IT teams,” Duritsky says. “Health care is often thought of as a place where you go when you have a medical risk. And there’s truth to that, but there’s also opportunity for other occupations within those institutions.”

As of December, health-care industry employment in the region sat at 270,400, a 21% increase since 2001. Within the field, ambulatory health services – jobs that provide outpatient medical procedures – saw employment increase 25%, hospital employment increase 21% and employment at nursing and residential care sites increase 17%. 

In the Youngstown-Warren-Boardman metropolitan area, which covers Mahoning and Trumbull counties in Ohio, as well as Mercer County, Pa., ambulatory care saw employment increase 23% since 2001 to 14,202. 

Nursing and residential care sites saw employment increase 22% to 11,632. 

Hospital employment, meanwhile, fell 23% to 8,535 because of reduced reliance on inpatient procedures and the closure of hospitals, such as Northside Medical Center, which cut 468 jobs when it closed in 2018. 

Still, hospitals were the sixth-largest sector in terms of total employment in the area last year. Ambulatory health ranked No. 3 and nursing and residential care ranked No. 4, behind only local government (21,562) and food service (11,632).

At St. Elizabeth Youngstown Hospital, operated by Mercy Health-Youngstown, there are half as many beds in use as there were at its peak, says President Dr. John Luellen. 

But recently, he says, the hospital added 25 beds to bring its total to 375 and is prepared to add 25 more.

“That’s an unusual phenomenon. As you add those beds, you need 

staff. It can be nursing staff, pharmacy staff, respiratory staff, medical assistants. It’s at all levels of caregivers,” 

he says. “One of the things many hospitals have noticed over the past decade is the contraction of inpatient care. What we’re experiencing at the Mercy Health-Youngstown hospitals is the opposite. Our volumes are growing to levels they haven’t been at in years.”

Part of the growth has been fueled by a population that is, by most measures, in worse health than the rest of the state. 

According to the Robert Wood Johnson Foundation’s County Health Rankings, Columbiana County is ranked 59th of Ohio’s 88 counties in overall health outcomes, followed by Mahoning County in 67th and Trumbull County in 72nd. 

For health factors, which include health behaviors, clinical care, socioeconomic factors and physical environment, Columbiana County ranked 60th, Mahoning County 63rd and Trumbull County 77th.

“Some of that growth is because we have a population that’s older than average. Some of it’s because we have a population that’s sicker than average. Some of it’s because we have a population that’s poorer than average,” Luellen says. “That growth comes because we’re dealing with a unique population.”

The growth in ambulatory care has benefited Southwoods Health, says CEO Ed Muransky. 

Since it was founded in 1996, the health-care system has focused on outpatient services, beginning with The Surgical Hospital at Southwoods. Most recently, Southwoods opened its Pain & Spine Center in May.

The 60-plus age group, Muransky says, drives much of the company’s growth. 

“As we have the 60-to-infinity age group in our area growing exponentially, we’re either going to find a way to take care of them or they’re going to go to Akron-Canton or Pittsburgh or Cleveland,” he says. 

“Until the electric trucks and battery plant and other projects get started, health care and the universities are the two drivers that we know we’ll need over the next five to 10 years.”

For those dedicated to caring for seniors, the increasing population of those over 60 is driving expansion. At Briarfield, the first cohort of baby boomers is starting to move in, reports President Diane Reese.

“With this growth in occupancy, the trend is to push boundaries of expectations,” she says. “That can be anything from staffing a building to accommodate more room service and other amenities, all the way to building a new building that’s in a better location for our population.”

Briarfield is looking at adding two sites in Trumbull County and one in Boardman at Market Street and McClurg Road, where site preparation has begun. 

The company, which operates eight independent and assisted living sites, has received the certification to open the Boardman skilled-nursing facility, which will break ground in the coming months, Reese says.

At Windsor House Inc., CEO John Masternick says the new generation of residents coming into senior-care are of a different cloth than previous generations. “They want a very different type of living model than people in their mid-80s. They don’t want a roommate. They don’t want to play bingo. They’re looking to be active and independent,” he says. 

That can mean either remodeling buildings to provide spaces new residents are looking for, such as private bedrooms, he says, or new construction if such renovations are feasible within an existing space.

Currently, Windsor House is in the process of remodeling two of its 17 sites and is working through the design process for a new site in Canfield that will include independent living.

“The model’s changing as we develop it. The industry is changing that rapidly,” he says. “We have plans to redistribute our capacity in Trumbull County and that may mean a new facility.”

Pictured: The Sim Lab at St. Elizabeth Youngstown Hospital shows students how to react to real-life situations. The Mercy Health Foundation provides funding for the lab.