Vital Signs: 2025 Healthcare Update

Employment Outpaces New Inventory Quarterly construction completions lag robust employment growth.

GROWTH DRIVERS

• Quarterly employment growth has outpaced medical outpatient building (MOB) construction in the last five years, despite the dip in employment at the peak of the pandemic in 2020. Post-pandemic employment growth has been robust and has averaged 3.0% across major medical sectors in the last three years, nearly three times the pace of MOB deliveries. • Hospitals posted a slight downtick in YOY employment growth in the third quarter. However, nearly 225,000 new jobs were added over the past 12 months, significantly outpacing the average 129,000 jobs added annually over the last three years. employment growth in the third quarter, adding 105,000 new jobs — still exceeding the three-year annual average of 99,000. • Outpatient care centers posted an increase in YOY employment growth in the third quarter, with 34,000 new jobs added, outpacing the three-year annual average of 30,000. • As the MOB construction pipeline continues to decrease, robust employment growth will result in additional absorption and occupancy increases, likely increasing demand for new MOB construction. • Similarly, physician offices experienced slower YOY

10%

8%

6%

4%

2%

0%

-2%

-4%

-6%

-8%

2017Q1

2021Q1

2018Q1

2016Q1

2019Q1

2017Q2

2021Q2

2022Q1

2017Q3

2021Q3

2023Q1

2018Q2

2018Q3

2016Q2

2019Q2

2016Q3

2019Q3

2017Q4

2021Q4

2024Q1

2018Q4

2020Q1

2016Q4

2019Q4

2022Q2

2022Q3

2023Q2

2023Q3

2022Q4

2024Q2

2023Q4

2024Q3

2020Q2

2020Q3

2020Q4

MOB Volume Growth Offices of Physicians

Hospitals

Outpatient Care Centers

Source: Revista Med, Moody’s Analytics, BLS, Cushman & Wakefield Research

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