© copyright the regents of the university of california the nicholas c. petris center on health...
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© Copyright The Regents of The University of California
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
An Economic Analysis of the Labor Market for Dental
Hygienists and Dental Assistants in California: 1997-2005
Timothy T. Brown, Ph.D.
Tracy L. Finlayson, Ph.D.
Richard M. Scheffler, Ph.D.
Acknowledgements
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
This study was jointly funded by the California Dental Association Foundation and the UC Berkeley Petris Center.
The CDAF commissioned reports from the Petris Center and UCLA Center for Health Policy Research to answer the question: Is there a shortage of dental hygienists and assistants in California?
Executive Summary and final reports can be found online at: http://cdafoundation.org/study/index.htm
And on our webpage: www.petris.org
Article also forthcoming in the Journal of the American Dental Association
Perceived Shortages
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
1999 ADA Workforce Needs Assessment Survey
2/3 private dentists nationwide thought there were shortages of Registered Dental Hygienists (RDH) and Dental Assistants (DA) in their areas
Main Reason: Lack of training programs and grads
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
Evidence from CaliforniaEconomic Labor Market Framework study to compare labor markets and
outcomes for RDHs and DAs
Economic Framework
• Economic demand = refers to the amount of RDH/ DA services that dentists are able and willing to pay for at any given wage rate.
• Economic supply = refers to the amount of services that RDHs/DAs are willing to provide to dentists at any given wage rate.
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
What is a labor shortage?
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
• Labor Shortage = shortages occur in a market economy when the demand for workers for a particular occupation is greater than the supply of workers who are qualified, available, and willing to do that job at a given market wage
- U.S. Department of LaborBureau of Labor Statistics (BLS),
2005
How do we measure a labor shortage?
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
• Supply and demand for workers can change over time and affect whether or not there is a labor shortage
• Various market scenarios:– Shortage: Supply < Demand (rising wages) – Equilibrium: Supply = Demand (stable wages)– Surplus: Supply > Demand (declining wages)
DATA SOURCES• Occupational Employment Statistics (OES) Survey data
number of workers, average wages from 1997 – 2005
• Committee on Dental Auxiliaries (COMDA) data on hygiene candidates passing licensing exam
• California Health Interview Survey (CHIS) and CA Behavioral Risk Factor Surveillance Survey (BRFSS) insurance and dental visit data
• State Health Expenditure Account data from CMS
• Census population data for California
• Wage data adjusted for inflation using the 2005 BLS Consumer Price Index (CPI; U.S. City Average, All Items)
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
Average Inflation-Adjusted Hourly Wages
39.5139.91
43.7444.89
42.54
34.46
31.0131.5731.00
15.3815.6916.48
16.8517.1816.6915.7115.4415.09
0.00
5.00
10.00
15.00
20.00
25.00
30.00
35.00
40.00
45.00
50.00
1997 1998 1999 2000 2001 2002 2003 2004 2005
Year
Wag
es in
200
5 D
olla
rs
Dental Hygienists
Dental Assistants
Shortage?
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
RDHs:
1999 = beginning of a clear rise in average inflation- adjusted wages, indicative of a labor shortage
2002 = wages peaked at 48% above 1999 levels
2003 - 2005 = leveled off, higher than in 1997
DAs:
Increase in wages by 13.9% between 1997 and peak in 2001, indicative of a labor shortage
Percent of Adults in California with a Dental Visit in the Last Year
70.466.868.469.468.267.0
65.263.364.966.5
0
10
20
30
40
50
60
70
80
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Year
Per
cen
t
Demand for Dental Care
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
• Increasing percent of adults with an annual dental visit from 1999 – 2004.~4.6 million more adults receiving dental care.
• Dental insurance coverage increased 21.7% among adults from 1995 – 2001.
• Dental expenditures increased 18.6% (inflation adjusted) between 1995 – 2000.
Demand-side factors
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
• Increase in demand for dental services appeared to be driving the labor shortages
• Increased service demand would be expected to increase demand of dentists for RDHs and DAs
Number of Dental Hygienists and
Assistants in CA per 100,000 Population.
108.95
105.49107.06
122.88
115.06116.62
103.9599.11
95.99
52.43 52.1355.09
58.1254.44
50.77 47.7152.5453.32
0
20
40
60
80
100
120
140
1997 1998 1999 2000 2001 2002 2003 2004 2005
Year
Nu
mb
er
pe
r 1
00
,00
0 p
op
ula
tio
n
Dental assistants
Dental hygienists
Supply-side factors
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
RDHs• Number per population is fairly constant
throughout this time period
DAs• Number per population increased, by 28%
from 1997 until the peak in 2003 • Strong supply response
1.781.72 1.73
1.95
2.22 2.23
2.34
2.20
2.041.99
0.00
0.50
1.00
1.50
2.00
2.50
1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05
Year
Can
did
ates
Pas
sin
g p
er 1
00,0
00 P
op
ula
tio
nCandidates Passing the CA Hygienist Licensing Exam per 100,000 population.
Hygienists in CA per 100,000 population
58.12
54.44
50.7747.71
52.5453.32
55.0952.1352.43
1.992.042.202.342.232.221.951.731.721.78
0
10
20
30
40
50
60
70
1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05
Year
Nu
mb
er p
er 1
00,0
00 p
op
ula
tio
n
RDH per pop
RDH candidates passing exam perpop
New RDH Supply
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
• A clear increase in the number of RDH candidates per population passing the licensing examination in California
• However, growth in the number of new RDHs was not enough to keep up with the faster growth in demand for services. New RDHs added to the labor force too small to make much of a difference in the wages.
Differences in supply responses
• Different training requirements for RDHs and DAs: – time requirement
– intensity of program
– number of training slots
• RDH supply is more constrained than for DAs
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
RESULTS – Shortage?
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
• From 1999-2002, RDH’s wages increased 48% then stabilized, indicating a fairly severe shortage had occurred, which the market resolved through higher wages.
• Wages for DAs increased 13.9% between 1997-2001, but then declined from 2001 to 2005 indicating a shortage, which then became a surplus. This market may not have stabilized yet.
CONCLUSIONS
• Economic framework is useful for monitoring trends in the supply and demand in the dental workforce
• Labor market responses to the shortages of RDHs and DAs were different – wage increases for both, but large supply response in the market for DAs brought wages back down
The Nicholas C. Petris Center
on Health Care Markets & Consumer Welfare
University of California, Berkeley
IMPLICATIONS
The Nicholas C. Petris Centeron Health Care Markets & Consumer Welfare
University of California, Berkeley
• Regular economic analysis could be helpful in determining and responding to labor market shortages or surpluses at local, state, and national levels
• Relevant for policy planning, making training capacity decisions, and assessing workforce needs
Economic Surplus in a Labor Market
Q Q
W WS1
S2
D11
q1 q2
w1
w2
w1
w2
q2 q1
D11
D21
S1
A A
Surplus – increase in supply
(a)
Surplus – decrease in demand
(b)
D = demand, S = supply, W = wages, Q = quantity, A = initial equilibrium
Economic Shortage in a Labor Market
Q Q
W WS2
S1
D11
q2 q1
w2
w1
w2
w1
q1 q2
D2
D11
S1
Shortage – decrease in supply
(a)
Shortage – increase in demand
(b)
D = demand, S = supply, W = wages, Q = quantity