The nation’s medical schools and teaching hospitals had a combined economic impact of $587 billion and supported nearly 3.5 million jobs directly or indirectly in 2011, according to a new economic impact analysis of AAMC-member institutions by the consulting firm, Tripp Umbach.
In 2011, one in every 40 wage earners in the United States worked either directly or indirectly for a U.S. medical school or teaching hospital, the report found. Since 2008, the last time the study was conducted, the total employment impact of these institutions increased by 4 percent (136,831 jobs).
“AAMC member organizations have substantial economic and social impacts on their multi-county regions and within the counties and cities where they have operations.… Communities in all regions of the country typically rely on these institutions for job creation, high-quality medical care, advanced research, new business development, and education of medical professionals,” the study notes.
“This study demonstrates how important medical schools and teaching hospitals are to the nation’s health,” said AAMC President and CEO Darrell G. Kirch, M.D. “In addition to the care these institutions provide to millions of Americans, medical schools and teaching hospitals are important economic engines in their communities.”
While supporting millions of jobs, AAMC-member institutions also generated more than $34 billion in total state government revenue in 2011 through state income taxes and commerce with local businesses, an increase of $12 billion over 2008.
The total $587 billion economic impact attributable to AAMC-member institutions in 2011 represents a 15 percent increase over 2008. This number includes $255 billion in direct spending, which consists of goods and services and capital improvements, spending by employees and patients as well as their families and visitors, and tax revenues. According to the report, the resulting indirect impact of this spending means that for every dollar spent by a medical school or teaching hospital in 2011, an additional $1.30 was generated.
While not included in the total $587 billion, a previous analysis by Tripp Umbach found that publicly funded research by AAMC members added nearly $45 billion to the nation’s economy in 2009 and accounted for one in every 500 jobs. An appendix on the research findings is included in the full 2012 report.
Download the report: The Economic Impact of AAMC-member Medical Schools and Teaching Hospitals