The market for skilled workers, administrators and support staff remains tight in U.S. health care as providers struggle to fill jobs, particularly critical roles such as nurses. The numbers have not appreciably improved since the last time I wrote about this topic: Total health care job openings have remained around 1.1 million to 1.2 million since December of 2017. The last official data from the Bureau of Labor Statistics show the sector added 50,000 employees to its collective payrolls in May; however total job opening increased by 87,000.
What can health care organizations, particularly providers, do to reinforce their talent pipelines? My colleague Rick Kes previously wrote about the strategic acquisitions HCA and Atrium are making into professional schools to gain direct access to nursing candidates. This is one method, but other viable solutions can be implemented at a smaller scale.
Upskilling builds employee loyalty
Training existing employees to do more complex jobs can meaningfully reduce turnover. According to a recent report, NSI Nursing Solutions Inc., 2019, nurses in more specialized fields such as pediatrics, burn care and surgical services exhibit lower turnover than those in more general areas of care. The report also found that turnover by registered nurses—which costs organizations $52,100 on average per nurse—was more than 90% voluntary, with career advancement a top catalyst. A paper written in 2007 by Scott Brum at the University of Rhode Island analyzing several studies in this field found that when an employee feels indebted to an employer because that employer provided training, that employee will be more committed and less likely to leave.
Health Care Management Review reported that the cost to train a new nurse is $21,852 to $29,851, expenses that include direct training and those associated with the new nurse’s initial gap in productivity relative to experienced colleagues. This number does not include opportunity costs such as the time those experienced colleagues will spend training the new hire, administrative paperwork, etc. It also excludes the impact of turnover on morale.
The data suggests that a hospital employing 700 registered nurses could spend over $3.5 million annually on direct training and ramp up time due to turnover (based on a 17.5% turnover rate, which is the approximate median for most hospitals). The NSI report claims a more comprehensive turnover expense estimate, suggesting the annual cost could exceed $6 million for the same hypothetical hospital.
As health care providers evaluate nurse retention programs they should consider allocating more resources to train existing nursing staff to fill high-level nursing roles. Provide a path to support LPNs becoming RNs, RNs training as OR nurses, etc. Studies suggest such training improves retention and the data is clear: turnover is expensive.
Brum, S. (2007). What Impact Does Training Have on Employee. University of Rhode Island.
NSI Nursing Solutoins Inc. (2019). 2019 National Health Care Retention & RN Staffing Reports. NSI Nursing Solutions Inc.
Waldman, J. D., Kelly, F., Arora, S., & Smith, H. L. (2007). The Shocking Cost of Turnover in Health Care. Health Care Management Review, 2-7.