Friday’s news that the nation added over a quarter-million private-sector jobs in January [opens pdf] was good news indeed for health plans, workers comp insurers, service companies. But January wasn’t the only bright spot; the report indicated a lot more jobs were added last quarter than previously thought, and the unemployment rate fell by two-tenths of a point.
Since August, the unemployment rate has fallen steadily from 9.1 percent to 8.3 percent, a significant – and encouraging – improvement.
Here are a few key indicators.
– employment in architecture and engineering grew by 7000 jobs, a likely harbinger of future growth in construction and manufacturing.
– construction employment increased by 21,000 after a jump of 31,000 in December
– manufacturing jumped by a whopping 50,000 jobs, much of it in durable goods such as automobiles
– November and December employment was higher than previously reported by 60,000 jobs
So, what are the implications for health plans and work comp payers and service providers?
More workers = more health plan members. We likely won’t see much growth for another couple of months, as many employers have extended their waiting periods for eligibility. However, the steady growth in jobs at small and large employers means organic premium growth with almost no added cost-of-sale.
Occupational injury rates akafrequency will trend up for some months as new employees tend to get injured more often than their more experienced, thoroughly-trained, and knowledgeable co-workers. This means more claims for work comp insurers, and more work for the industries servicing work comp – think physical therapy, imaging, bill review and repricing, networks. Pharmacy will also tick up, but the PBMs are somewhat isolated from frequency trends by long time claimants high utilization.
Most encouraging is the overall increase in employment over the last 22 months.
Feb
6
