Economic Impact of Healthcare

The Partnership for Michigan’s Health reports healthcare directly employed nearly 568,000 Michigan residents in 2021, demonstrating that healthcare remains the largest private-sector employer in the state despite continued staffing losses attributed to the COVID-19 pandemic. The 2023 release of 
The Economic Impact of Healthcare in Michigan shows direct healthcare workers in Michigan earned nearly $46 billion that year in wages, salaries and benefits. Hospitals alone employed 219,000 individuals in the state in 2021. 

Direct healthcare employment helps create additional jobs that are indirectly related to or induced by healthcare. These indirect, healthcare-supported jobs are held by more than 470,000 people who earned about $28 billion in 2021 in wages, salaries and benefits. Together with their employers, the more than one million workers in healthcare contributed $19.6 billion that year in local, state and federal taxes. These taxes include Social Security, income, motor vehicle, sales, property, corporate and more.

Data from 2021 shows the impact the pandemic had on the healthcare workforce in Michigan. While direct jobs decreased by nearly 4,000 total positions, direct wages increased by 4% year-over-year as labor costs rose due to increased demand. Direct wages in hospitals increased by 6.8%, as many hospitals offered wage adjustments and bonuses to recruit and retain employees, and increased the use of contract labor with staffing agencies. A separate study conducted by the MHA in 2022 showed expenses related to contract labor and recruitment and retention bonuses increased by $516 million from 2020 to 2021. Nursing and Residential Care also experienced a similar trend, as the number of jobs in the category fell by about 8,000 but compensation remained about the same.   

Fiscal Year 2021 Data