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Health Care and Social Assistance in Rhode Island's Economy

In a previous Data Story1 examining Rhode Island's economy, we found that Health Care and Social Assistance is both the largest employment sector in the state and the sector projected to add the most new jobs in upcoming years. This Data Story will look at the sector in more detail to better understand its role in our economy.

We start with the latest available wage data for all industries to see how this sector fits into RI's overall employment landscape. We then explore wages for Health Care and Social Assistance in detail, drilling down into individual job sectors to see where the wages actually go. Finally, we offer some comparative looks at health care wages in nearby states and at projected growth in different health care occupations nationally. Our analysis offers a detailed picture of the economic impact of this important job sector.

*Data sources and notes.

Wages and Employment Sectors of RI Workers

The first visual to your left shows the distribution of annual wages per job for all RI jobs in 2013, including full-time and part-time positions.2 For nearly half of all RI jobs, the annual wage was less than $25,000. This is far less per job than the Rhode Island average, which was $47,729 in 2013. Remember that the average wage encompasses the lowest and highest-paying jobs, so it can be skewed by a small number of atypical wages.3

Click on the second tab to see the industries in which RI workers earned wages in 2013. By far the largest proportion of RI jobs were in the Health Care and Social Assistance sector.

Spotlight on Health Care and Social Assistance

This graphic shows the distribution of annual wages for each job found in the Health Care and Social Assistance sector in 2013. About 45% of RI Health Care jobs paid less than $25,000. However, about a third paid between $25,000 and $50,000, which means that this sector provides a significant amount of middle-class jobs for Rhode Islanders.

The second graphic categorizes Health Care jobs by ability to provide a living wage. Using MIT's Living Wage Calculator for Rhode Island4, we can see that 40.5% of these jobs do not provide a living wage for 1 adult. About 17.5% of RI Health Care jobs do provide a living wage for 1 adult, but not for a family (defined as 2 working adults with 2 children). About 42% of jobs in this sector do provide a family living wage or better.

Health Care Sub-Sectors

Previously, we looked at the Health Care and Social Assistance sector as a whole. However, the sector is much more heterogenous than the previous analysis implies; it has four sub-sectors, each of which contains multiple industry groups.

As the chart in the first tab shows, the sub-sector that provided the most jobs in 2013 was Ambulatory Health Care Services, with just over a third of all jobs. These are outpatient providers: doctors' office and the like.

The skills required in each of the sub-sectors varies, along with compensation level. The second chart displays average and median wages for each sub-sector. While the average wage gives us an overall picture of the wages paid, the median wage offers a picture of the "typical" wage per job. Jobs in the Hospitals and Ambulatory Care sub-sectors paid the highest average wages by far, but the typical wages were much lower; these sectors employs physicians and many less-skilled support staff. Wage disparities in the lower-paying Nursing and Social Assistance sub-sectors were much smaller.

Ambulatory Health Care Services

Next we delve into each sub-sector in more detail. In this set of charts we look at the largest, Ambulatory Health Care Services.

The first chart shows, again, a skewed distribution of wages, with 42.4% of RI Ambulatory Health Care jobs offering annual wages below $25,000.

The second chart breaks out jobs by industry group to show which types of jobs are in highest demand right now. Offices of Physicians employ the most RI workers (33%).

The graphs in the third tab show average wages by industry group.5 The highest wages are found in the largest group, Offices of Physicians, which employs a third of all Ambulatory Health Care workers. The next-highest wages are earned in the smallest industry group, Medical and Diagnostic Labs, which employs only 3% of workers in the sub-sector.

Hospitals

The Hospitals sub-sector featured the highest average wage of all four sub-sectors in 2013. This is reflected in the wage distribution chart in the first tab; only 18.4% of Hospitals jobs pay less than $25,000 a year. Average wages in Hospitals are higher because the jobs are generally better, not because a few top earners are skewing the figures.

The chart in the second tab shows that the vast majority of RI Hospitals jobs are at General Medical and Surgical Hospitals. However, as the third set of charts shows, average wages in 2013 were highest for those workers employed in Specialty Hospitals. These hospitals provide diagnostic and medical treatment to inpatients with a specific type of medical condition (except psychiatric or substance abuse).

Nursing and Residential Care Facilities

Looking at Nursing and Residential Care Facilities, we see in the first chart that almost two-thirds of RI jobs in this sub-sector paid less than $25,000. Recall that this sub-sector provides one-quarter (24%) of the Health Care jobs in RI.

The majority of RI jobs in this sub-sector are in the Skilled Nursing Facilities industry group, although there was not a large difference in average wages across Nursing industry groups. Skilled Nursing would also be the only place to expect a family living wage; the other industry groups either pay too little on average or do not offer enough hours per job.

Social Assistance

Finally, we look at the Social Assistance sub-sector; it is both the smallest and the one with the lowest average wages. These are the front-line workers for families and children in RI communities. In the first chart, we see that almost three-quarters of RI Social Assistance jobs paid less than $25,000 in 2013. This may reflect part-time work, by choice or otherwise; either way, we might expect that many employed in this sub-sector took on second jobs.

The largest industry group within Social Assistance is Individual and Family Services, but it is the smallest industry group--Community Food and Housing, and Emergency and Other Relief Services--that pays the highest wages.

Industry Group Comparison

Here we can see an overview of the different industry groups within the Health Care and Social Assistance sector: both the share of jobs provided by each group (as indicated by the size of the bubbles) and its average wages (as indicated by the shading; darker blue indicates a higher average wage).

This visualization shows us which industry groups offer the most jobs AND the best wages. Immediately we see that General Medical and Surgical Hospitals is the biggest sector and pays well, on average. Other hospital industry groups have a smaller presence, but also pay well. It's clear that jobs in office/outpatient care as well as medical labs also feature a high average wage. Finally we see that jobs providing services to children, families, and the sick or elderly living at home provide the lowest wages. Unfortunately these industry groups provide a significant number of RI jobs.

State Comparisons

How do jobs in Rhode Island's Health Care sector compare to similar jobs in our region? Using data from the U.S. Bureau of Labor Statistics6, we compare private sector average wages for each sub-sector. This graph shows that our state's compensation patterns aren't much different from the regional norm. Our Health Care jobs pay somewhat less than CT and MA, but our cost of living is also less.

However, Health Care jobs pay somewhat better in Rhode Island than in ME or VT, despite similar or greater costs of living in those states.7

Occupations in Health Care

Health Care jobs are projected to grow faster than many other occupations between 2012-22, according to the Bureau of Labor Statistics.8 This is certainly true in Rhode Island9 where Health Care is already one of the biggest employer in our state. Despite the low wages offered by many jobs in this sector, the national projections10 suggest that in-demand, high-paying Health Care careers will continue to become available even to those without a Bachelor's degree.

This chart groups Health Care occupations by the required education at the entry level, and shades them by projected growth. The length of the bars indicates the median pay. We can see that the vast majority of occupations requiring an Associate's degree or less are growing faster or much faster than average. Wages in some of these high-demand/moderate skill occupations (like Dental Hygienists and Radiation Therapists) are comparable to what one might expect with a Master's degree. or even a professional degree.

Conclusions

In our examination of the Health Care and Social Assistance sector of the RI economy, we had two major goals. The first was to establish an overview of the sector, to better understand how many jobs it provides and the wage distribution of those jobs. The second was to contextualize this information within regional and national Health Care employment trends. Our analysis offers information for those looking to enter this growing sector or move up from a lower-paying Health Care job to a higher-paying one.

Our key findings point to weaknesses we must confront as well as strengths on which we should build. Health Care is a major employer of RI workers, but a large proportion of those jobs are low-paying. Jobs that provide critical social services to our children and families pay little more than fast-food work. Skill development opportunities and preferential hiring could create career ladders for those starting out at the lower end of the Health Care wage spectrum, but looking to stay in the sector.

There are also many bright spots in our Health Care sector. In RI, Hospital jobs are fairly plentiful and offer good pay. Medical and diagnostic labs also offer good pay, but as of right now, we don't have many available positions in this industry group. We could invest more in developing Rhode Island's reputation as a destination for general and specialty hospital care as well as laboratory diagnostics.

We could also make better use of national projections about job growth in this sector to guide students and the unemployed toward the numerous high-demand/moderate-skill occupations that offer good wages. Even if those we educate and train don't end up working in RI, our state can better prepare them for the economic landscape they will face for the next decade or more.