Health care is increasingly central to Oklahoma’s economy

If you ask a person on the street what Oklahoma’s economy is known for, two industries likely to come to mind are oil and gas drilling and agriculture. Yet when we look at the jobs Oklahomans are working in today, those industries play a much smaller role than that common understanding might assume.

Agricultural jobs almost vanished in the 1990s and never came back, and today the industry is barely more than one percent of the state’s GDP. Oil and gas mining still makes up a sizable portion of the state GDP, and that sector provides a large segment of Oklahoma’s highest-paying jobs. However, when you look at what the average worker is doing to make a living in Oklahoma, oil and gas jobs aren’t in the top ten.

In those top ten sectors, the big story since the turn of the century for Oklahoma workers has nothing to do with the ups and downs of oil and gas. Instead, the most important trend for workers has been the steady rise of jobs in health care.

As the chart shows, in 2001 health care and social assistance was the third largest employment sector in Oklahoma, just behind manufacturing and retail trade. Health care took the top spot in 2002 and its lead has grown every year since. Health care jobs increased even during the Great Recession of 2008-2009, when nearly every other sector was losing jobs. Today, health care and social assistance directly accounts for nearly one out of every eight jobs in the state. The health care sector has become especially important in Oklahoma and nationwide as a thriving source of middle-class jobs — registered nurses have accounted for the largest share growth in middle-class jobs since 1980, and nursing is projected to be by far the largest good-paying job of the future.

The other notable trend in this data is the significant decline in manufacturing jobs, which had been the largest sector in 2001. Manufacturing jobs fell sharply in 2001-2003 and then again in 2008-2010. Most of those jobs never came back. Over the whole period from 2001 to 2016, almost 45,000 health care jobs were added in Oklahoma and about 42,000 manufacturing jobs were lost.

One takeaway from these trends is that the policy of “right-to-work”, which Oklahoma adopted in 2001, has been an utter failure at boosting the traditionally unionized manufacturing sector. Oklahoma also saw no decrease in unemployment after adopting right-to-work, and the number of new companies bringing jobs to the state dropped by one-third in the following decade. That correlation doesn’t mean right-to-work caused those declines — the automation of manufacturing is a trend that likely would have continued with or without this policy — but it does show that making it harder to unionize has not paid off in economic growth or job creation.

Another big takeaway is that Oklahomans should be very concerned about how the massive cuts to health care funding currently being considered by Congress would ripple through our economy. A recent report from the National Women’s Law Center found that 25 percent of Oklahoma’s health sector jobs are supported by Medicaid spending, so the Congressional GOP’s attempt to cut more than $800 billion from Medicaid over the next 10 years is a dire threat to the largest source of good jobs in Oklahoma.

The federal cuts would come on top of the cuts Oklahoma is considering to at-home care of seniors and people with disabilities and cuts to the uncompensated care fund that endanger Oklahoma’s most efficient way of providing basic primary care for uninsured residents. This legislative session, state leaders worked hard to cater to the wishes of the oil and gas industry due to its economic power in our state. Why are they treating health care — which provides many more jobs than oil and gas — with much less concern?

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Gene Perry worked for OK Policy from 2011 to 2019. He is a native Oklahoman and a citizen of the Cherokee Nation. He graduated from the University of Oklahoma with a B.A. in history and an M.A. in journalism.

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