Center on Urban & Metropolitan Policy Eds and Meds: Cities’ Hidden Assets By Ira Harkavy and Harmon Zuckerman1 Institutions of higher learning2 (“eds”) and medical facilities (“meds”) are some of the largest “Eds and meds private employers in America’s biggest cities. A survey of the top 10 private employers in the largest 20 U.S. cities found that: are often over- I Nearly 550,000, or 35 percent, of I An ed or med is a top employer in the 1.6 million people who work every one of these cities despite their looked fixed for the top ten private employers differences in age, region, and devel- are employed by eds and meds. opment pattern. assets that, I At least half of the employers in five I Although the District of Columbia’s of the cities—Washington, Philadel- major employer is the federal govern- phia, San Diego, Memphis, and San ment, eds and meds account for 76.7 especially dur- Jose—are eds and meds. percent of the jobs generated by the top ten private firms. I Sixty-nine out of the 200 largest ing a booming private firms, or 35 percent, are eds I In Baltimore, Detroit, and Philadel- and meds. phia, the number of eds and meds jobs in the ten largest firms make up economy, could I In four of the cities—Washington, over 10 percent of the entire city’s job Philadelphia, San Diego, and Balti- base. In half of the cities surveyed, more—eds and meds account for these jobs make up over 5 percent of help turn the more than half of the jobs generated. the city’s total employment. tide around The Importance of Eds and meds as one of those overlooked fixed for cities.” and Meds for Cities assets. In all the competition for new jobs and businesses, eds and meds have largely ities have been struggling over the been ignored, even though they generate a last three decades because of a substantial number of jobs and contribute to shrinking job base, loss of middle- the local economy. In a time when suburbs class families, and rising unemploy- are generating jobs considerably faster than Cment and crime rates. However, cities have central cities, eds and meds, like all employ- often overlooked fixed assets that, especially ers, are becoming increasingly important for during a booming economy, could help them turn the tide around.3 This study looks at eds continued on next page Cent August • The Brookings Institution • Survey Series 1 The 1999 Figure 1 cities as they struggle to keep their Washington DC’s Top Private Employers share of jobs in the metropolitan area. 18,000 Eds and meds also have unique characteristics that add value above 16,000 and beyond creating jobs. Eds and 14,000 academic meds constantly conduct research and impart technical expert- 12,000 ise on their students and workers. In 10,000 an era increasingly dependent on knowledge-based industries, these 8,000 institutions contribute to a more expe- rienced and educated workforce, a 6,000 resource desirable in all cities. Fur- Number of Employees 4,000 thermore, their economic activities foster an entrepreneurial spirit and 2,000 attract additional economic growth. 0 George WashingtonGeorgetown U.Howard &U. Hospital & Hospital U.Washington & HospitalPotomac Hospital Electric WashingtonCenter PowerBell Post Co. AtlanticChildren's of Washington FederalNational National MedicalProvidence Mortgage Center Hospital Assoc. This survey looked at the 20 largest cities in America and focused on the top 10 private firms in each (see Table 1). The findings show that eds and meds employ nearly 550,000, or 35 percent, of the 1.6 million people who work for the top ten private employers in these cities. In fact, out of the 200 top private firms surveyed, 69 are eds or meds. On average, the eds and meds jobs in the top firm Figure 2 employment pool account for approx- Baltimore’s Top Private Employers imately 6 percent of a city’s employ- 25000 ment base (see Table 2). While these cities vary in age, region, and development pattern, they 20000 all have at least one ed or med among their top employers. Some cities have particularly large eds and meds repre- 15000 sentation, such as in Washington where over 76.7 percent of the jobs generated by the top ten private 10000 employers are with eds and meds.4 In fact, the District’s top four firms are Number of Employees 5000 eds and meds, and they each employ more workers than the Washington Post, Bell Atlantic, and Federal 0 Johns HopkinsHelix HealthJohns System HopkinsNorthro-Grunman HealthBell System Atlantic Corp.Baltimore GasUniversity & Electric Giantof Maryland FoodSparrows Medical Point NationsSystem Bank National Mortgage Association (see Figure 1). Just over 8 percent of the city’s jobs are generated by eds and meds (see Table 2). continued on next page Center on Urban & Metropolitan Policy August 1999 • The Brookings Institution • Survey Series 2 Figure 3 In Philadelphia, San Diego, Mem- New York City’s Top Private Employers phis, and San Jose as well, over half of 30,000 the top private employers are eds and meds. In four of the twenty largest cities—Washington, Philadelphia, San 25,000 Diego, and Baltimore—eds and meds account for more than half of the jobs 20,000 generated by the top 10 private firms. Baltimore has more people employed 15,000 at Johns Hopkins and Helix Health System than at Baltimore Gas & Elec- tric, Giant Foods, and Nations Bank 10,000 (see Figure 2). The eds and meds jobs Number of Employees account for approximately 16.5 per- 5,000 cent of the entire city’s job base (see Table 2). 0 Chase ManhattanNYNEX Columbia UniversityCiticorp New York UniversityConsolidatedTime Edison WarnerMerrill LynchTravelers GroupBank of NY Co. While New York is internationally recognized as the center of the finance industry, two of its largest employers are eds and meds, making up nearly 20 percent of the jobs in the top 10 firms. Columbia University and New York University have more workers than recognize that their fate may be tied to See the University of Mary- some of the most well known financial the health of the community, they land’s Medical system at firms, including Merrill Lynch, Travel- invest in their neighborhoods, generat- www.umm.edu for good local ers Group and Bank of New York. ing even more beneficial effects for hiring practices. Columbia also employs more workers themselves and for their communities. than Citicorp (see Figure 3). Below are just a few of eds’ and meds’ I Research and Teaching. Uni- activities and their paybacks. versities and colleges in partic- ular can bring community to What Are the Implications? I Purchasing Power. Institu- the classroom through service tions can establish purchasing learning programs in their ot only are these firms large agreements for goods and serv- undergraduate arts and sci- job generators that con- ices with local providers, circu- ences schools, and by putting tribute to the general eco- lating wealth and supporting their professional programs nomic health of the city, other jobs within the commu- into practice such as with their Nthey are unique in that they are rooted nity. They benefit from having business schools, urban plan- to a specific place. They are essentially readily available and reliable ning programs, education immobile institutions and their iden- goods and services. MIT offers schools, and others. Polytech- tity is tied to the city and community. a good case study example. nic Institute created a univer- Yale University conducted an eco- For more information, see sity park called Metrotech to nomic assessment of its impact on web.mit.edu. implement this strategy. See New Haven and found that “Yale’s www.poly.edu/brooklyn.html strength and the health of the City, I Hiring Practices. Local job for more details. fiscally and socially, are inextricably training and placement organi- linked” (Economic Impact: Yale and zations and school-to-work pro- I Real Estate. Eds and meds New Haven, 1993). The study’s find- grams can be utilized to hire own vast tracts of land, and the ings motivated the University to com- and train the local labor force, value of that land is affected mit over $41 million to a variety of making it easy for universities when the local real estate mar- neighborhood revitalization projects and hospitals to find workers in the city. Because some eds and meds with the necessary skills. continued on next page Center on Urban & Metropolitan Policy August 1999 • The Brookings Institution • Survey Series 3 Figure 4 ket fluctuates. When eds and Philadelphia’s Top Private Employers meds invest in their properties, put them to productive use, 30,000 and support community stabil- ity, all stakeholders benefit from increased land values and 25,000 an improved environment. For examples, see Marquette Uni- 20,000 versity’s homepage at www.marquette.edu or Yale 15,000 University’s at www.yale.edu. I Tax Base. Eds and meds that 10,000 help create economically viable Number of Employees communities and improve the 5,000 quality of life directly increase the local tax base. This, in 0 U. of PennsylvaniaAllegheny & U.TempleMedical & Health U. Center Thomas& System Hospital JeffersonPECO EnergyU. &CoreStates Health Co. SystemBell Financial Atlantic AramarkGroup - PA Corp.PNC Bank,Albert NA Einstein Healthcare Network turn, allows localities to rein- vest in their neighborhoods, and ultimately generate even more economic opportunities. See www.sunysb.edu for the University of New York at Stony Brook’s efforts on this. I Homeownership. Eds and environment and support busi- University of Pennsylvania: In addi- meds can help rebuild their ness that provide goods and tion to local purchasing contracts and surrounding neighborhood by services for residents and visi- job training programs, the University giving their employees afford- tors alike.