Health care changing West Michigan economic landscape

Hari Singh
Hari Singh
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GRAND RAPIDS, Mich. — The economic landscape of West Michigan is changing dramatically as the region emerges from the recent recession, with health care and education expanding sectors for employment. One major issue for community leaders is that growth in these sectors must be strategically managed. 

Those are among the findings from a report prepared by Grand Valley State University and the nonprofit organization Alliance for Health. The results were released during an event at Grand Valley on January 8. The report can be viewed online at www.gvsu.edu/healthcheck or downloaded as a PDF at this link.

The report was written by Seidman College of Business faculty members Hari Singh and Paul Isely. The report offers an ongoing trend analysis of three major issues: knowledge foundations, health care trends, and economic analysis focusing on Kent, Ottawa, Muskegon, and Allegan counties.

The report's authors note that the expanding health care sector has a major impact on the region. A 2008 economic impact analysis estimated by the Michigan Hospital Association indicates that the health care sector results in a total of 59,942 jobs in Kent County. The overall economic impact for Kent County is estimated to be $3.8 billion.

Some of the report's findings include:
Knowledge Foundations
• Regional educational programs are graduating students at a rate that will meet projected job demand in most occupations.
• There will be a significant predicted shortage of nurses but a surplus of veterinarians.
• There has been a sharp increase in medical patent activity in the region since 2005, which is an indicator of knowledge creation. The major new players are companies such as INRAD and Van Andel Research Institute.

Health Care Trends
• There is set to be a dramatic increase in the 45-64 age group — a group associated with higher use of medical services.
• In West Michigan, there is a drop in the 18-34 age group, which is not seen as dramatically at the national level. This trend may indicate that young graduates are leaving Michigan — and that the low risk proportion of the population may shrink over time.
• Trends of particular concern in the region are heavy drinking and obesity and a rising incidence of low birth weight babies.
• The cance rate is higher in West Michigan than it is in Detroit or the nation as a whole — and it is rising, while it is on the decline elsewhere. The region has lower diabetes rates than the state, but the trend is sharply up.

Economic Analysis
• Three main drivers of increased hospital stays — low birth weight babies, rising obesity rates leading chronic diseases such as diabetes and hypertension, and heavy and binge drinking — are on the rise in West Michigan. Trying to slow and perhaps reduce these risk factors can significantly reduce health care costs.
• The Grand Rapids Metropolitan Statistical Area (MSA) has lost 31,900 jobs in manufacturing in the last nine years. On the other hand, it has gained 3,600 jobs in education and 13,900 jobs in the health sectors. Consequently, 55 percent of the job loss in manufacturing has been recouped by education and health sectors.
• Manufacturing will be under pressure to be more productive and employ less labor. The report recommends that resources currently employed in precision manufacturing could be used for medical instruments and equipment.

About the Alliance for Health
The Alliance for Health is a coalition of community health care members dedicated to the encouragement of optimal health for all residents through high quality health care services at the lowest cost.

About Grand Valley State University
Grand Valley State University, established in 1960, is a four-year public university. It attracts more than 24,400 students with its high quality programs and state-of-the-art facilities. Grand Valley provides a fully accredited liberal undergraduate and graduate education and has campuses in Allendale, Grand Rapids and Holland, and centers in Muskegon and Traverse City. Grand Valley is a comprehensive university serving students from all 83 Michigan counties and dozens of other states and foreign countries. Grand Valley offers 77 undergraduate and 28 graduate degree programs. The university is dedicated to individual student achievement, going beyond the traditional classroom experience, with research opportunities and business partnerships. Grand Valley employs more than 1,700 people and is committed to providing a fair and equitable environment for the continued success of all.