Where Have All The Workers Gone...?
INSTALLMENT 1 of 2
In Installment 1 of this 2-part blog series, we share with you the current state of affairs in U.S. employment … and it ain’t a pretty picture for employers, especially in healthcare. For myriad reasons, employers are struggling to fill workplace roles with well-qualified, skilled professionals.
BY JEFF LITTLE
PARTNER
[February 28, 2024] – You see it across the employment spectrum from foodservice to retail to healthcare – staffing shortages or less-than-stellar workers whose indifference or lack of necessary skills and experience are apparent.
There are many theories: Shifting attitudes towards work-life balance; an inflation-driven sense of hopelessness leaving people on the sidelines asking, “Why bother?”; a trend towards simplifying lifestyles that demand less money; and, of course, government subsidies that help bridge financial gaps in peoples’ lives [if only covering bare necessities].
Never was this more apparent than during the recent Pandemic Era when millions of workers across all industries shifted to remote work, changed careers in favor of safer settings, or opted out of employment altogether, many accelerating their retirement plans.
Balance of Workplace Power Has Shifted
What was for decades an “employer’s market” has become an “employee’s market” and workers are more likely to up and leave in search of greener pastures more quickly than ever before, especially among the younger demographic.
It cannot be overstated: Employee retention is a major issue in today’s labor market. And virtually no industry is unaffected.
According to a recent report from the U.S. Chamber of Commerce, America’s current labor force participation rate is 62.5%, down from 63.3% in February 2020 and 67.2% in January 2001. Unemployment remained unchanged last month at 3.7% — better than the 14.8% we experienced in April 2020 at the onset of the pandemic — but still slightly higher than what’s considered ideal for a healthy economy.
While there’s no one single prevailing reason why workers are sitting out, several factors have come together to cause the ongoing shortage:
Two-thirds [66%] of Americans who lost their full-time job during the pandemic say they are only “somewhat active” or not very active at all in searching for a new job.
About half [49%] are unwilling to take jobs that do not offer the opportunity for remote work.
More than a quarter [26%] say it will never again be essential for them to return to work.
Nearly one in five have altered their livelihood, 17% have retired, 19% have transitioned to homemaker, and 14% are now working part-time.
Nearly a quarter [24%] say government aid packages during the pandemic have incentivized them to not actively look for work.
And the future doesn’t bode much better. Younger respondents to the survey, aged 25-34, are prioritizing personal growth over searching for a job right now [more and more people in their mid-late 20s are back home living with parents to do this], and 36% of them say they’re more focused on acquiring new skills, education or training before re-entering the job market.
The Great Reshuffle
The Great Resignation worked its way into our vocabulary as the shift in the labor force became apparent -- and the hashtag #quittok even went viral as social media users posted proudly about quitting their jobs in search of more free time, better-paying career opportunities, or careers offering greater upward mobility.
However, the story is more complex than individuals simply leaving jobs. Perhaps a more appropriate moniker for the high quit rates of the past few years is “The Great Reshuffle.” More than 34 million Americans quit their jobs in 2023 [3.7 million in September 2023 alone]. However, the hiring rate has outpaced the quit rate since November 2020. This means Americans are seeking – and finding – better opportunities with new employers and in new occupations and industries. [At least those who want to work, that is.]
Nowhere is this more apparent than in healthcare, especially among the nursing corps. Even with salaries that have risen dramatically – RN salaries increased 15% from 2019 to 2022 as demand for well-trained, experienced nurses increased — hospital administrators lie awake at night worrying about nursing staff shortages or the high cost of going to third-party nursing agencies to augment its W2 nursing team. Further, many healthcare system administrators worry contingent nurses may not be truly engaged and delivering high-quality nursing care to patients. The result of that is lower patient outcome scores and resultant decreases in reimbursement.
Currently, the average full-time RN salary is $89,010, according to the most recent Medscape RN/LPN Compensation Report. That salary places nurses 44% ahead of the U.S. average for all occupations but even at that compensation level, staff shortages are rampant in hospital systems across America.
It’s true of any worker in any industry: An employee who is engaged, fulfilled, and convinced their efforts are making a difference is happier and more productive in the workplace. More specifically, happier nurses and caregivers create more fruitful care environments which leads to shorter hospital stays, satisfied patients, better patient outcomes, and higher levels of reimbursement.
The solution is to hire more and more of these types of professionals but how do we make that happen? Well, I may have the answer for you.
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NEXT UP — In Installment 2, we’ll share what we believe is the key to identifying, hiring and, most importantly, retaining highly skilled RNs who embrace the mission of delivering world-class healthcare.
If you’d like to know more, please contact Excelerant Consulting today. We’re here for you. info@excelerantconsulting.com
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ABOUT JEFF LITTLE
Jeff is a Partner at Excelerant Consulting and a widely recognized thought-leader in hospital supply chain, purchased services, hospital operations, facilities and construction, and medical capital equipment. He brings a deep insight and understanding of today’s healthcare environment and is well-connected throughout the industry, having worked in clinical settings within world-class hospitals, and multiple Integrated Delivery Networks [IDN] and Group Purchasing Organizations [GPO]. He is highly skilled at educating clients on subtleties and nuances of the today’s complex healthcare ecosystem and excels at the development of commercial strategies.
Jeff is an active member of the Association for Health Care Resource & Materials Management [AHRMM], American College of Healthcare Executives [ACHE], Federation of American Hospitals [FAH], the IDN Summit, and serves on the board of the ACE Summit.
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ABOUT EXCELERANT CONSULTING
Excelerant Consulting is the go-to organization for med-tech companies that need to position products and services successfully for value analysis committees, contract acquisition, and sales modeling and execution to commercialize the launch of medical devices or services with Group Purchasing Organizations [GPO], Integrated Delivery Networks [IDN], or Regional Purchasing Coalitions [RPC]. Clients rely on Excelerant to enhance their product positioning, navigate corporate contracting opportunities, and provide sales support to accelerate growth and profits.
For more info, contact Excelerant Consulting at info@excelerantconsulting.com