Health Act Repeal Could Threaten Major Job Creation Engine: Healthcare Industry

The repeal of Obamacare will have adverse affects on the economy because of the increased importance of the healthcare industry, Michael Gapen, the chief U.S. economist at Barclays, told The New York Times.

"Demographics and the expansion of Medicare and Medicaid in past decades contributed to the rise of healthcare's share of the economy, and Obamacare extended that," Gapen told the Times. "It's not trivial, and it's much easier to constrain activity than to promote it.

"Reversing Obamacare is negative for the economy in the next year or two."

The House passing of the American Health Care Act this week comes at a delicate time for the economy and job market, and might threaten to restrict job growth, according to the Times.

"The outsize economic role of the American healthcare industry heightens the risks posed by the Republicans' effort in Washington to repeal the Affordable Care Act, enacted in 2010 under President Barack Obama, and it comes at a delicate moment for the broader economy," the Times' Nelson D. Schwartz and Reed Abelson wrote Saturday.

"While the government reported Friday that unemployment was at its lowest point in more than a decade, the healthcare industry has been an engine for much of that hiring, adding jobs at more than three times the rate of the rest of the economy since 2007."

Healthcare accounts for one-fifth of all employment in some areas, is 20 percent of U.S. GDP — up from 13 percent in 2000 — and is close to become the second-largest sector of U.S. employment, according to the Times.

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