Healthcare reform efforts are driving further job cuts in the healthcare, pharmaceutical and medical device industries. What started as a rationalization of sales forces and a response to the global recession has accelerated in response to health finance reform legislation pending before Congress.
As noted in the Wall Street Journal Health Blog, there have been significant cuts. Today, Johnson & Johnson announced 8,000 jobs will be cut. Previous major layoffs include the Pfizer/Wyeth 20,000 cut, Eli Lilly’s decision to cut 5,000 jobs, and AstraZeneca’s 7,000 job elimination. And by adding them up, the Wall Street Journal gets to 40,000 job cuts.
I believe that is underestimated by at least half. And here’s why. These were only the major cuts and the only the ones that caught big headlines. There have been many other more subtle layoffs, including Merck/Schering (16,000) that will materialize soon, Caraco Pharmaceuticals (450), BMS (113 in Indiana), and Charles River (115). Other companies have not quantified their layoffs.
Most bluntly, Boston Scientific CEO Ray Elliott has indicated that Obamacare would cost his company an additional 1,000-2,000 jobs.
Into this fray, countries are stepping in and making a valiant pitch to American and European companies to outsource jobs there. These countries offer compelling financial incentives without any of the entanglements offered by the Obama regime.
One thing is certain, healthcare reform as envisioned by President Obama will accelerate American job losses.