Saturday, November 14, 2009

Growing the Economy by Growing Healthcare: Serious Medicine Strategy as an Economic Strategy

Mike "Mish" Shedlock, an investment analyst, projects that US unemployment could stay above 10 percent through 2015, and stay above 8 percent for a decade.

We aren't economic experts here at SMS, so we report, you decide. But whatever the unemployment numbers prove to be over the next decade, under current conditions, they don't seem destined to be very good.

For all the discussion of economic stimulus, as Serious Medicine Strategist Jim Woodhill says, "The world economic situation can be summed up as, 'desperately seeking demand.' And healthcare is perhaps the most voracious source of demand there is." Indeed.

According to the Labor Department's Bureau of Labor Statistics, seven of the 20 fastest-growing occupations in the US are healthcare related. The BLS further notes that healthcare is adding jobs, even during the recession.

Those on the left often think of "stimulus," as building roads, but the problem with that strategy, as the Japanese have discovered, is that contemporary road-building is not very labor intensive. In the 30s, to build a road, hundreds of men might be swinging picks. But today, roadbuilding requires relatively few workers and lot of machinery. We're all for higher productivity--not many people particularly enjoy doing manual labor outdoors--but America still faces the issue of getting people into jobs. How to do that?

Of course, not everyone is a fan of "stimulus" packages. But conservatives and libertarians--especially if the GOP regains power in 2010 or 2012--must grapple with unemployment, and what to do about it. So they, too, will need a strategy for generating more real jobs here in the US.

And so we come back to healthcare, which is hard to outsource or offshore. The opportunity for growing the economy by growing healthcare has been a steady theme here at SMS. bbbAs we wrote back in August, taking note of ideas from Segway inventor Dean Kamen, Serious Medicine has great potential to be an economic driver, because medical equipment is one of our remaining competitive industries, worldwide.

And we also quoted Nobel Laureate Robert Fogel in September, making many of the same points, reminding us that healthcare can pull along many other industries, including construction, finance, and manufacturing.

Serious Medicine Strategy is good for health, and it's also good for the economy. A win-win!


  1. The only people I've seen actually building roads in years appear to be Mexicans--presumably illegals. Decades back, blacks did the heavy work. Nowadays, the only blacks you see on a road crew are sitting in a pickup, with an elbow hanging out the window, supervising the job. Therefore, it can be assumed that the only people being affected by the shovel ready stimulus are those who shouldn't be here in the first place, and of course the contractors. --jh

  2. Health care mitigating unemployment is a truism beyond reproach. Part of the reasoning for such unbalanced proportions between unemployment in the inner cities and unemployment in the suburbs has to be dealt with quickly and in a sensible manner. The health care interview is way different than what happens to aspiring individuals seeking middle management positions that may arise in numbers some day. In health care of course you have to be presentable and well spoken and have a reasonably clean record. The accent however is weighted toward specific skills and education. There is a growing need for good people and we can build this requirement in the health sector because there is scarcity. I have to digress for a second and remark that most of the unemployed aside from health care workers and professionals have to be schooled on proper interviewing techniques and the need for being well groomed and well spoken and probably some sort of specific job training.I have not been advised that the administration is earnestly working with the unemployed in these areas so when jobs come up, applicants can pursue them in a credible manner. We usually end up talking about a guy making $75/hour laying a cable across the Hudson. I am not worried about him. We will grow health care employment certainly, we have to give a leg up to the other Americans who need a boost.

  3. In 1966 while in Ireland visiting the relatives, my Grand Uncle named "Young Jack" (he was 77, - I don't know why he was called this) asked me what was the biggest difference I saw between Ireland & the USA.
    A good question then: I said in America when a boy turns 18 the decision is 'What College or University he will go to, in Ireland it is What country he will immigrate to to make a living.'

    Today the question is still valid, But Vis-a-Versa!!
    I'm afraid the unemployment rate will be very high for the next 10 years. And as a Grandpa I'm not happy about it.
    Medicine is a good place to be career wise today. Both my kids are in it. As a doctor and nurse they can always get jobs, make a living especially with (percentage wise) an aging population. In fact funeral parlors will do well too.
    I agree with everything you wrote Jim.