One of the many harmful effects of the Great Recession was wage deflation in certain sectors. Is it possible that an economic drag has reached into highly skilled professions such as medicine?
The layoffs and hiring freezes generally have tapered off, but for many years companies were downsizing, industries contracting and the ranks of the unemployed expanding. Some job seekers could not find work, let alone positions that matched their previous salaries. Others accepted the drop in income as an inevitable result of market forces and now make due with less.
A report based on a survey of physicians found that the vast majority had their incomes drop or remain the same between 2013 and 2014. The biggest proportion—45 percent—responded that they earned less compared with the previous year and another 43 percent made the same amount.
Jackson Healthcare has conducted an annual email survey since 2012 that is designed to assess physicians’ job satisfaction and compensation. In late June, the company published some key findings, but it did not define income. It is unclear if income means base salary or salary plus bonuses and incentives or other compensation arrangements.
Nor is it clear whether working hours changed in the year-to-year comparison. It is possible that a drop in income corresponded with a cutback in hours worked, although it seems unlikely that almost half of the physician workforce decided to ease up on the time they put into their careers. Alternatively, reductions in Medicare reimbursement, requirements to perform time-consuming nonclinical tasks, cost-conscious patients and other forces could erode physician compensation.
In 2012, we explored the fiscal landscape in cardiology as healthcare shifted from volume to value. Some policy makers said compensation was due for a “correction.”
The Jackson Healthcare survey may reveal a pernicious trend if wage deflation compels physicians to leave healthcare. According to the survey, 14 percent of physicians whose income dropped were considering a career change or retirement.
Physicians may be among the highest paid professions, but for good reason. They are highly educated, highly skilled and most are highly dedicated to the work they chose.
Have you seen your earning power diminish in recent years? Please let us know.
Cardiovascular Business, editor