With the omicron variant of Covid-19 threatening to throw a blanket on the light at the end of the pandemic tunnel, staffing suppliers and healthcare leaders are faced with the heavy task of trying to calculate future coverage needs based on an unpredictable but dominating variable. What is clear is that healthcare workers quit in record numbers during 2021, and that even sans the introduction of yet another deadly strain of the virus, 2022 isn’t offering any promises of optimal staffing levels. While many organizations and suppliers scrambled to fill vacant positions during the year, some quickly learned that equally as valuable was retaining the existing talent and experience. Faced with the possibility of more record-breaking months of staff resignations, staffing leaders will need to focus their efforts on bringing in new employees, while simultaneously mitigating organizational turnover and recovering from what feels like an Olympics of survival.
SIA’s US Staffing Industry Pulse Survey Report for November confirmed that, like other industries, the healthcare staffing industry has been hit by “The Big Quit” in 2021. The report revealed that from January through October, staffing firms serving the healthcare vertical had a median internal employee turnover rate of 10%. The midrange spanned from 3% at 25th percentile to 16% at the 75th percentile. This was roughly in line with the overall staffing industry, which also had a median of 10% and a similar midrange. While the survey did not have sufficient sample to report on all of the healthcare subsegments, for travel nurse, the median turnover was 5%. The lower turnover among travel nurse firms is not surprising given the boom in business in this segment that has supported robust compensation levels, particularly with those employees on incentive plans.
Y/Y Revenue Growth from October 2020 to October 2021
In addition to internal staff turnover, staffing firms must not lose sight of the risks of turnover among their associates placed on assignment. While many staffing suppliers continue to see unprecedented revenue growth, they are not immune to the financial dings of escalating quit rates.
Given the lack of steadiness of several key factors currently impacting healthcare, we anticipate that the healthcare workforce will remain volatile for the foreseeable future. Fluctuations in pay rate, high turnover and vaccine mandates have created a cocktail of uncertainty. This workforce volatility represents both a challenge and an opportunity for staffing firms, and gives staffing firms an opportunity to be a more consultative partner to their clients on issues such as staff retention.
Staffing firms can become more valuable to their clients if they gain a deeper understanding of factors that drive turnover among healthcare workers. A recent survey conducted by McKinsey & Co. identified the top reasons why nurses quit. Insufficient staffing levels topped the list of factors influencing a nurse’s decision to leave. This key point lends insight into the critical timing of filling holes in staffing. Simply put, unbalanced staffing levels are a major driver of nursing quit rates and quickly pivoting to balance those levels is an imperative piece to avoiding crisis. The No. 3 reason for nurses to quit was the emotional toll of the work; therefore, providing emotional support and proper resources can be a key role in bolstering retention. The overarching theme based on existing responses is that, though some turnover is expected, other voluntary separations are preventable.
Factors Contributing to Nurse Voluntary Separations
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As we approach the end of 2021, which, among other things, revealed an extraordinary reliance on the healthcare staffing industry, healthcare staffing suppliers are looking toward 2022 with new perspectives on the significance of not only recruitment, but retention as well. Forward-thinking agencies looking to curb turnover should look to stock their existing retention toolkits with nonfinancial incentives such as wellness and mentorship programs, sincere pulse checks, digital open-door policies, and avenues for recognition and mobility within the existing organization. For more insights on quits and other valuable resources, please check out our surveys here. And also, be on the lookout for our next Pulse survey happening in January.
