Maya Goldman, Tina Reed
Jun 24, 2024
Rising health care prices have measurably increased unemployment in the United States, according to a new study in the National Bureau of Economic Research.
Why it matters: Surging health care costs don't just hit Americans in their pocketbooks — they could be costing them jobs, especially for middle-income workers.
The big picture: Most people with health insurance are covered through an employer. That system creates a "direct link" between health care prices and labor market dynamics outside of the health sector, the researchers said.
As health care prices rise, so do the costs to employers providing health insurance.
But the impacts are felt more broadly among workers. Previous research has found that growing health care costs have also stifled their wages.
The new research found that a 1% increase in health care prices lowers an employer's headcount by about 0.4%.