top of page

Rural Health System Resources


Regional Economic Impact of Public Hospital Investment


Regional Australia Institute


The value of hospitals to their communities extends far beyond healthcare. In NSW, local health districts provide vital public hospital and health services to around 2.8 million people living in regional and rural areas. Of the $2.89bn capital works program in 2019-20, more than $900m is allocated for capital infrastructure investment in rural and regional NSW. The research has provided an evidence base about the economic impacts of hospital redevelopment. The case study findings support:
• There is a strong connection between public and private investment in healthcare;
• Investment in public health infrastructure leads to flow on growth in health jobs (both in hospitals and other allied health services, and in public and private sectors); and
• Healthcare is a significant growth employment area across all skill and wage levels ... and plays a key role in overall employment.

Why is this useful for rural and remote people?

There is a substantial body of research that demonstrates the flow-on economic impact of the closure of rural health and hospital services in Australia and other developed countries. This study looks at the positive economic and employment effects of investing in rural and remote hospitals. While the study is primarily about new hospital investments in larger regional centres, the finding that investing in health leads to more jobs, stronger population growth and greater economic activity is equally applicable to small rural and remote towns. Rural and remote people can use this research to advocate for investment in strengthening local rural and remote health and hospital services. Governments have evidence that investing in rural and remote health and social services contributes to local employment, economic activity, and population retention and growth in these towns, as well as better health outcomes for local people. Rural and remote people might consider raising questions with their local member, or health services, about whether they are taking into account the flow-on and induced benefits of health care investment in rural and remote communities when making decisions to allocate resources to local health care.

Suggested Citation

The Regional Australia Institute (2019), Regional Economic Impacts of Public Hospital Investment,
Canberra, The Regional Australia Institute.


bottom of page