In a cost cutting move, medical device-maker Stryker Corporation recently announced plans to lay off 1,000 workers in advance of the impending medical device tax. By reducing its workforce by 5%, Stryker hopes to save $100 million annually to offset the 2.3% tax on medical devices starting in 2013. The Obama administration hopes the tax will raise $20 billion in tax revenue from 2013 to 2019 to fund the Patient Protection and Affordable Coverage Act.
In a cost cutting move, medical device-maker Stryker Corporation recently announced plans to lay off 1,000 workers in advance of the impending medical device tax. By reducing its workforce by 5%, Stryker hopes to save $100 million annually to offset the 2.3% tax on medical devices starting in 2013. The Obama administration hopes the tax will raise $20 billion in tax revenue from 2013 to 2019 to fund the Patient Protection and Affordable Coverage Act. An earlier study estimated job losses due to the new excise tax will be in excess of 43,000 – or more than 10% of those employed in the industry. The United States has been shedding high paying manufacturing jobs for several decades. Jobs in the medical device industry, which pay an average of around $80,000 per year, will be hard to replace.
