What the jobs data tells us: Trends in health care hiring

Is the RN shortage returning?

Dan DiamondDan Diamond, Managing Editor

Health care is adding jobs.

(This isn't news. The sector has gained workers for 103 months and counting, according to the Bureau of Labor Statistics.)

What is new: The unprecedented rate of health jobs growth.

And after several years when the nursing shortage slipped from a top-of-mind concern to CEOs' back burner, there are signs that shortage conditions are returning.

Historic surge in hiring
As detailed last month, BLS reported that the health sector added nearly 50,000 jobs in February and more than 92,000 jobs in the first two months of 2012. About half of the new jobs were on the outpatient side.


Of course, there's a chance that the agency will revise down its early 2012 results.

But based on the current BLS data, even if health care didn't add any jobs in March—an extremely unlikely outcome—Q1 2012 would still be the sector's strongest first quarter in four years, and one of the best on record.

Why the record hiring? A range of factors, experts say. Inelastic demand and the broader economic recovery. Underlying demographics.

Some of it's driven by changing business models in health care, suggests Gregg Masters, the publisher of ACOWatch.com.

"We’re just beginning to create new demand for different skill sets," Masters told the Briefing, citing the implementation of EHRs, HIEs, ACOs, and medical homes. "[And] the thirst will continue for the foreseeable future."

Telling indicator of RN workforce
But while the surging demand is great news for would-be health care workers, it's creating a mixed picture for health care employers.

According to John Workman, a senior consultant with the Advisory Board's HR Investment Center, hospitals and health systems have enjoyed historically low turnover and vacancy rates for several years. That stability helped tamp down labor costs, as economic fears prompted workers to hold onto their jobs.

But economic confidence has generally increased in recent months. And Workman pointed to the HR Investment Center's industry benchmarks, drawn from an annual survey of about 200 hospitals, which suggest that turnover and vacancy rates are on the rise too—and a new nursing shortage may be on the horizon.


 

Beyond the impact on nurse hiring, Workman pulled out two lessons from the latest HR Investment Center benchmarks.

  • The economic recovery is beginning to affect all health care workers: After the depths of the recession, workers aren't so insecure that they can't move jobs, Workman said.
  • There's more movement between organizations: As employers add jobs, "it's not that hospitals are just hiring new workers straight out of school," he said.

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