Strong employment, high earnings and valued shipments are among the direct and indirect benefits of the medical technology industry to the U.S. economy, according to a June report from the Lewin Group, which found that the industry is continuing to experience growth despite declines in other sectors.
Researchers found that the medical technology industry employed 422,778 workers in 2008, paid $24.6 billion in earnings—or an average of $58,000 annual salary—and accounted for $135.9 billion worth of products, based on data from the U.S. Census Bureau and the 2008 Annual Survey of Manufacturers. Compared to 2005, those data demonstrate increases of 12.5 percent, 11.4 percent and 11.6 percent, respectively.
“Given the notable increases in all three measures of direct benefits listed above—employment, earnings and shipments—the additional benefits from the medical technology industry remain impressive,” the authors wrote.
The Census Bureau tracked eight segments of the medical technology field, according to the study. Employing the largest number of workers and bringing in the highest payrolls and sales in 2008 was surgical appliance and supplies manufacturing, with 114,500 employees, $6.4 billion in payroll and $35.3 billion in sales. Surgical and medical instrument manufacturing garnered the next highest figures, according to the report.
A notable characteristic of the industry, researchers found, was the strong pay scale. While the average payroll for an employee in the medical technology industry was $58,000 for 2008, the national average was less than $42,000. “This is almost a 40 percent premium for jobs in the medical technology industry,” the authors wrote. “Medical technology also pays a healthy premium relative to the average manufacturing job.”
While regular manufacturing employees tended to earn more than the national average of private employees, according to the study, their earnings were still about 22 percent less than those working in the medical technology industry.
For communities, the authors noted a number of benefits of the medical technology industry. Higher income and education households have greater levels of disposable income, they wrote, and there is also business-to-business benefit, as materials are bought and sold.
Authors noted a cylical economic impact of medical technology industries on communities.
“The medical technology industry establishments purchase inputs, including components and parts, raw materials, office supplies and utilities. The enterprises that sold the inputs generate their own cycles of impacts from further purchases of inputs as well as their own payrolls,” the authors wrote.
Larger states generally had the highest employment numbers within the field, according to the research, with California accounting for nearly 84,000 workers, followed by “disproportionately high” Minnesota, then Massachusetts, Pennsylvania and Florida, with about 27,000 workers in each state. Minnesota and Utah had the highest concentration of medical technology jobs relative to total employment, researchers found, with nearly three times the national average. Following closely, Delaware, Massachusetts and Indiana had more than double the national average.
The authors concluded that in the median state, each medical technology job generated an additional 1.5 jobs; each dollar in medical technology earnings generated an additional $.90 in earnings; and each dollar in output generated an additional $.90 in output.
“As the economy continues to recover from the current climate, the medical technology industry’s economic impacts to the states should be revisited to document future growth,” authors concluded.
The full report can be found here.