This eleventh special report of the National Commission for Manpower Policy examines the manpower, employment, and training implications of policy developments in the health care industry. Section 1 describes the health care industry setting, including health sector characteristics and health expenditure growth. Sections 2 and 3 deal with the employment of the largest group of health care workers: those employed by others and, particularly, those in institutional settings. In section 2 the past trends and future prospects for such workers are examined and includes the current utilization of professionals and paraprofessionals in health care, the forces that have stimulated health expenditure growth and those leading to expenditure restraints, and the labor market impact of mechanisms implemented to control expenditures along with countervailing forces working to continue past trends in growth. Section 3 explores some of the manpower policy implications inherent in future trends and developments in health labor markets. The fourth section, focusing on physicians, discusses the labor market for physicians and examines four potentially significant developments: policies to redistribute physicians, growing emphasis on primary care, growth of prepaid group practice, and increases in physician supply. The concluding section summarizes and then recommends nine ways to improve manpower policy planning and decisionmaking in the health care industry. (EM)