The MedZilla Report: June 2009 Employment Outlook for Biotech/Pharma/Health

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The hallmark of layoff announcements in health care has always been a statement on the order of "layoffs will not affect patient care", but the question remains: how many more people can be laid off before that is unavoidable? MedZilla.com's monthly employment report examines that trend, as well as announcing an increase of more than 20,000 jobs in health care.

As the second quarter came to a close last month, companies nationwide scrambled to get somewhere close to their bottom-line projections. With the continuing economic problems in the United States -- which many experts now call an outright recession -- companies are still required to cut back on their biggest expense: their employees. In June, pharmaceutical companies increased layoffs, though most layoffs came from health care. Despite that, health care employment increased overall by 21,000 people, which is the average for the first two quarters of 2009.

Generally, hospital systems have continued eliminating jobs and leaving open jobs unfilled due to loss of profits, an increase in uninsured patient care, and a decrease in reimbursements from insurance companies including Medicare and Medicaid. As for pharmaceutical companies, many are scaling back their research efforts due to the heavy costs involved in bringing a new medication from development to market. The largest cut in June came from Oscient Pharmaceuticals in Massachusetts, as they announced the elimination of 150 sales representatives along with 30 additional marketing and corporate positions (The Boston Globe, 6/12/09).

Interestingly, Massachusetts was also home to the biggest month-to-month jump in candidate search activities -- that is, companies actively seeking out new employees. They topped eight percent. Three states increased by more than three percent, and three more by more than two. Illinois-based companies slowed their search efforts by more than five percent in June, with four other states also showing slowdowns of two percent or more. As for jobs being posted, those same Massachusetts-based companies also showed a reduction of just over one percent, the largest drop in any state in June. Most other states remained relatively flat -- that is, a change of less than one percent in either direction. The posted jobs are a combination of medicine, sales, and product development.

Even though many recent news reports indicate that health care is one of the fields showing job growth -- and 18 months of MedZilla.com statistics back that up -- it does not appear that candidates are changing their job search activities. There was almost no change in the locations where potential applicants searched or the types of jobs they sought.

The hallmark of layoff announcements in health care has always been a statement on the order of "layoffs will not affect patient care", though it is questionable just how many administrative employees can be let go from a hospital or hospital system before patient care suffers not from a lack of doctors and nurses but the inability to keep track of what's going on. "Companies continue to downsize even after significant layoffs have already occurred," said Michele Hopps, director of marketing for MedZilla.com, the internet's leading source for medical and pharmaceutical job postings. "Patients need to be sure they -- or their families -- are keeping track of what's going on, because there are fewer and fewer administrative employees to answer questions about issues like billing."

Meanwhile, Oscient's layoff announcement last month also came with a caveat -- that they would keep their products on the market but discontinue direct-sales efforts -- which could be an indicator that new PhRMA rules about what pharmaceutical sales representatives can and cannot do in the pursuit of their jobs. "The dramatization of the sales rep who bring in a full lunch and go home with a signed contract was never really accurate," said Hopps, "but the new guidelines, which nearly every pharmaceutical company adheres to, make it even less accurate. In the coming months, we'll be watching to see if moves similar to Oscient's are more about cost-cutting than changes in the way pharmaceuticals are sold, but right now, it seems like the answer is 'both'."

About MedZilla.com:
Established in mid-1994, MedZilla is the original web site to serve career and hiring needs for professionals and employers in biotechnology, pharmaceuticals, medicine, science and healthcare. The MedZilla jobs database contains about 7,500 open positions. The resume database currently contains over 285,000 resumes with 16,800 less than three months old. These resources have been characterized as the largest, most comprehensive databases of their kind on the web in the industries served.

Medzilla® is a Registered Trademark owned by Medzilla Inc. Copyright ©2009, MedZilla, Inc. Permission is granted to reproduce and distribute this text in its entirety, and if electronically, with a link to the URL http://www.medzilla.com. For permission to quote from or reproduce any portion of this message, please contact Michele Hopps, Director of Marketing and Development, MedZilla, Inc. Email: mgroutage(at)medzilla.com.

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