Nurse employment and wage trends – Healthcare Economist

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Recent news articles have spilled much ink about the current nurse shortage. According to Pew, due to nursing shortages “Hospitals nationwide are canceling nonemergency surgeries, struggling to quickly find beds for patients and failing to meet the minimum nurse-patient ratios experts recommend.” Nursing wages are rising as well. The Baltimore Sun reports that the University of Maryland Medical System is planning to spend $5.1 million to recruit nurses. However, these are anecdotal accounts. What do the data say at the national level?

A paper by Buerhaus et al. (2022) uses aggregate payroll data from the Bureau of Labor Statistics and unemployment data from the Current Population Survey (CPS). The data cover the period from February 2020 (just before the pandemic) to June 2021.

Based on the data, the authors find a decline in health care employment that is “unprecedented”.

By April 2020 employment had decreased most in physician offices (−11 percent), outpatient care centers (−8 percent), and home health care (−7 percent). Employment decreased least in hospitals (−2 percent), the largest employer of RNs, partly because of an influx of patients with COVID-19 and other patients whose care could not be delayed. Nursing homes saw only a small decline as of April 2020 (−3 percent), but unlike in other sectors, the decline in nursing homes continued into 2021. Employment in most sectors gradually returned toward prepandemic levels over the course of 2020, except in the nursing home sector, where the decline continued steadily. Employment levels had rebounded in hospitals (−2.2 percent), physician offices (−0.7 percent), and outpatient centers (+2.6 percent) by June 2021. However, fifteen months into the pandemic, total employment in nursing homes remained 13.2 percent lower than it had been in February 2020

While post-pandemic employment decreased only 1% for registered nurses relative to a pre-pandemic baseline, these figures were a 10% for licensed practical or vocational nurses (LPN/LVN) and a 20% decline for nursing assistants (NAs). As a point of context, as health care employment has never decreased any year during the previous 3 decades.

Nurse wages also have risen dramatically, particularly for /LVN and NAs. For hospital-based LPN/LVN and NAs, wage growth was more than 10% last year.

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