IT Hire Wire

Here at Hudson, my primary focus is on recruiting and partnering with our clients in the healthcare industry for their IT staffing needs in the Chicago area.  These clients primarily include the healthcare “payers” and “providers,” where the “payers” are loosely defined as the insurance companies and “providers” consist of hospitals and other institutions which provide care to patients.

Over the last several months during the trials and tribulations of the economy and the recession (we can finally call it that), it was believed that the healthcare sector would escape the hardships facing many companies. This argument is often similar to what Bob Wachter mentions on The Healthcare blog:

“The bottom line is that people will keep getting sick, no matter where the Dow is.”

Unfortunately, the healthcare industry may not be “recession proof.” Recently, we are seeing many of our healthcare clients place more scrutiny on their current and future 2009 IT projects, which has resulted in many positions being canceled and current staff being reduced. Often this has led to current staff now handling the roles and responsibilities of their own job, as well as another’s.

A recent article in the Chicago Tribune by Bruce Japsen validates that the healthcare sector may not avoid the slump.

“Moody’s sees fewer patients seeking medical care, particularly elective surgeries, while more people could lose their health-care coverage altogether. Such trends will lead people to delay getting medical care or avoiding treatment.”

“Health insurers, too, may face credit issues, Moody’s said, citing “operational, economic and political challenges that will lower margins and hamper growth.”

BusinessWeek.com’s Catherine Arnst predicted back in March that Healthcare is Not So Recession-Proof. Perhaps she uncovered the impending softness in IT:

“On top of all that, it’s difficult for hospitals to cut staff or salaries given the extreme shortage of nurses and other health-care workers. “We’re essentially a fixed-cost business,” says Beth Israel’s Levy. The only choice many hospitals have will be to delay or cancel capital investments.”

The long and the short of it is that if people lose their jobs, they often lose their health benefits.  If they lose their health benefits, people postpone elective treatment.  If people postpone treatment, hospitals and other health providers lose revenue.  Furthermore, if people lose their benefits, the healthcare payers see drops in their enrollment membership, which cuts into their revenue and therefore their profit margins.  This cycle will inevitably lead to reduced spending on IT systems and infrastructure and decrease the opportunities for employment within these companies.  It is a turbulent cycle but one that exemplifies how interconnected our economy truly is.  With payers and providers clenching their budgets a bit, let’s hope it is a cycle that is short-lived.

Photo by JasonRogers

Tags: Healthcare, IT Jobs, Recession

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