Health Care Industry Adds $103 Million to Local Economy

Health Care Industry Adds $103 Million to Local Economy Main Photo

19 May 2020

Health care is the third-largest employer in Phelps County and generates nearly $103.8 million annually into the local economy, according to a new report.

Nebraska Public Power District Economist Kenneth M. Lemke, Ph.D., created the report that shows concrete statistics about the economic contribution of health care to Phelps County.

“Healthcare operations and the services they deliver are key to a community’s viability, yet the sector is often overlooked as an economic driver,” said Ron Tillery, Phelps County Development Corporation Executive Director. “In Holdrege, the hospital, clinics and associated enterprises contribute more than $103 million to the region’s economy.”

The industry also provides many career opportunities, attracts new residents and helps retain students seeking fulfilling careers. In 2018, the local health care industry employed 790 workers in Phelps County with an annual total employee compensation of $33.3 million. The average salary paid to health care employees was $42,000, which is 6.8 percent higher than the area’s overall average salary of $39,371.

“Our overall economy benefits tremendously from the salaries and induced impacts generated by the healthcare sector,” Tillery said. “The value of a report like this is that it focuses attention on the building blocks of our economy. More than $33 million is paid in compensation annually to healthcare workers, which converts to local spending, home improvements and increased valuations.”

Health care ranks third behind agriculture and manufacturing as the largest employers in the county. Health care was the fifth-largest industry when ranked according to output ($79,847,000).

“While the direct impacts of Phelps County Health Care provide an indication of its impact, they significantly understate the industry’s overall contribution to the area,” according to the report.

Health care provides $79.8 million in direct impact to the area’s economy and an additional $13.3 million in supply chain output and $10.7 million in induced output. On the employment side, health care provides 790 direct jobs and an additional estimated 100 supply chain jobs and 80 induced jobs.

When factoring in patients who travel to the area from out of town for medical services and local spending by health care workers, the impact becomes much higher.

“The analysis indicates the 2018 direct and secondary impacts of Phelps County Health Care affected 6.2 percent of final sales by local businesses, 14 percent of local employment, 14 percent of local employee compensation, and 7.6 percent of local GRP,” the report revealed.

Tillery said that Holdrege has become a regional healthcare service provider that attracts a significant number of patients from a large territory.

“We need to be alert to the needs of those patients and the opportunities to capture additional revenues while they are here,” he said. “We hope our relationship with Retail Strategies (a nationwide marketing firm) will help to identify areas that could be more fully developed to take advantage of this large and growing market.”

For more information about this and other market reports, please visit the PCDC website at or contact Tillery at