Report: Hospitals Contribute $19.5 Billion to N.J. Economy

Oct 24, 2012, 11:38 ET from New Jersey Hospital Association

Plus, a Reliable Source of Jobs with 140,000 Employees Statewide        

PRINCETON, N.J., Oct. 24, 2012 /PRNewswire-USNewswire/ -- New Jersey hospitals contributed $19.5 billion to the Garden State economy in 2011, reflecting strong growth of $900 million compared with 2010, according to the 2012 N.J. Hospitals Economic Impact Report released today by the New Jersey Hospital Association.

Despite a struggling economy, 2011 saw increases in key areas of hospital activity such as total employee salaries, state income taxes paid by employees and goods and services purchased from other businesses. Hospital jobs in New Jersey held steady at about 140,000, including 114,000 full-time jobs.

"New Jersey communities rely on hospitals for healthcare services, but it's important to remember that hospitals also are bedrocks of state and local economies," said NJHA President and CEO Betsy Ryan. "Even in the depths of a nationwide downturn, hospitals remain a strong and reliable source of jobs, salaries and spending that reverberate throughout our state."

The Economic Impact Report uses data gathered from 72 acute care hospitals in the Garden State and compiles their economic contributions statewide and across counties and individual hospitals. The 2012 edition uses data from year-end 2011. The full report is available at

Specific highlights from the 2012 report include:

  • New Jersey hospitals purchased $2.5 billion in goods and services from other companies last year, an increase of $100 million over 2010. Key areas include contracted labor ($1.2 billion), pharmaceuticals ($853 million), utilities ($286 million), dietary, laundry and housekeeping ($137 million) and building supplies ($17 million).
  • New Jersey hospitals paid $7.9 billion in employee salaries last year, compared with $7.6 billion in 2010.
  • Employees at New Jersey hospitals paid approximately $435 million in state income taxes last year, compared with $422 million in 2010.
  • New Jersey hospitals paid more than $132 million in state taxes, assessments and fees last year, compared with $129.5 million in 2010.
  • New Jersey hospitals delivered about $1.3 billion in charity care services last year to the working poor and other uninsured residents, on par with 2010 charity care levels.

Hospitals' economic contributions extend beyond the dollars-and-cents reflected in the report's totals. According to the American Hospital Association, the "ripple effect" of hospital economic activity means that each hospital job supports about two more jobs and every dollar spent by a hospital supports roughly $2.30 of additional business activity.

"The true economic value of hospitals extends far beyond these conservative totals – especially in our current weak economy," said Sean Hopkins, NJHA's senior vice president of health economics. "Hospitals are steady sources of jobs in a time of high unemployment, reliable customers for other New Jersey businesses and major contributors to the quality of life for communities all across our state."

SOURCE New Jersey Hospital Association