96.5 F
San Fernando
Thursday, Mar 28, 2024

SPECIAL REPORT: Despite Sector Disruption, Biotech Jobs Abound

Consolidation in the San Fernando Valley health care industry might be causing job cuts, but the sector is so healthy that laid-off workers are being reabsorbed into the job market quickly. A little more than a year ago, Thousand Oaks’ Amgen Inc. announced plans to cut 1,100 employees from its global workforce, in addition to 2,900 cuts previously announced. Just last month, Kythera Biopharmaceuticals Inc. in Westlake Village announced it would permanently lay off 117 employees by Nov. 30. And Health Net Inc. of Woodland Hills said in July that its acquisition by Centene Corp. in St. Louis would save $150 million a year, with part of that presumably coming from job cuts. But Peter O’Neill, vice president of investor relations and corporate communications for Health Net, thinks the corporate consolidation could prove a stimulus to local health industry staffers. “Consolidation in the industry typically allows for growth within employee populations as companies expand and new opportunities for career expansion develop,” said O’Neill. “Day-to-day business operations typically require the same level of employment support, and in many cases, require additional support due to the expected growth.” However, employee redundancies most often occur at the level of top management, he added. O’Neill sees consolidation continuing as care management companies adapt to the requirements of the Affordable Care Act. Improving efficiency and economies of scale are important to combating smaller profit margins, and consolidation allows companies to take advantage of more operational resources and negotiating power with health care providers to reduce costs. Even with the national trend of acquisitions and resulting layoffs, the health care industry has added 495,000 jobs over the past year, and 45,000 of those jobs came last month, according to the Bureau of Labor Statistics. As stated in the 2015-16 U.S. Health Sector Report from accounting firm Ernst & Young, there are 32 million newly insured Americans as a direct result of the ACA. With more people insured, more doctors and nurses are needed – as well as administrators to process people through the system. Recruiting talent In addition to health care reform, an aging population is a factor that plays into the increase of health care positions. The baby boomer generation is getting older and living longer, increasing the number of medical professionals needed to care for them. According to the U.S. Centers for Disease Control and Prevention, one in five Americans will be a senior citizen by 2030. Furthermore, individuals older than 65 have three times more hospital stays than the general population, while people older than 75 have four times more, as reported by AMN Healthcare Staffing, a health care employment agency in San Diego. This same aging population carries over into the workforce as well. Fifty percent of registered nurses and doctors are 50 and older, while two-thirds of registered nurses who are 54 and older are planning to retire within the next three years, according to AMN. This presents quite the opportunity for companies such as AMN and Calabasas temporary staffing agency On Assignment Inc. On Assignment reported $1.86 billion in revenue in 2014 and expects to top $2 billion in 2015 revenue. On Feb. 1, the company sold off its nursing division and physician segment, but has beefed up its life-sciences operation. The company projected 6 percent growth in the life-sciences staffing market this year and used some of the money from its physician divestiture to invest in that area. “We anticipate that our life-sciences and technology clients will increase their use of outsourced labor through professional staffing firms to meet the need for increases in capacity of their workforce,” the company said in its 2014 annual report. In the company’s most recent investor presentation, it projected the staffing industry will generate $134 billion in revenue this year alone. The presentation cited a few industry growth drivers, including technology. Apollo Medical Holdings Inc., an integrated health management company in Glendale, has been implementing quality and cost-efficiency processes based on technology and has seen employment grow within the company. Just this month, ApolloMed announced a collaboration with Pasadena data analytics firm Helynx Inc. to deploy a technology system that will identify at-risk patients to improve their health care. As the company strategically enhances its technology, it also strategically enhances its workforce needs. “Over the last several years, we have tripled the number of full-time equivalent employees and contractors,” said Gary Augusta, ApolloMed executive chairman.

Featured Articles

Related Articles