Demand for travel nurses will likely continue to be soft in 2025, according to ratings agency S&P Global, but the industry remains a critical partner to hospitals. S&P Global made the forecast in an announcement regarding AMN Healthcare Services. S&P Global forecast revenue at the healthcare staffing firm will decline by the high- to mid-single digits in 2025 following a 22% decline this year. AMN’s long-term issuer credit rating was lowered to “BB” from a “BB+” rating.

S&P Global noted healthcare organizations hired more permanent staff to offset their use of contingent labor following the surge in demand for travel nurses caused by the pandemic. Less use of contingent staff has driven down both bill rates and use of contingent labor.

“The trajectory of the decline in bill rates was steeper than our expectations as well as the rollback in the usage of temporary staff,” according to S&P Global. “While there are signs of market stabilization, with a modest increase in open orders (which could indicate demand has bottomed out), we believe the challenges persist and the path to recovery remains uncertain. We thus expect the demand for travel nurses will remain soft in 2025 in our base-case scenario.”

Still, the healthcare staffing industry remains a “critical partner to hospitals to meet staffing and patient needs” despite the ongoing challenging conditions, S&P Global stated.

The ratings agency also noted AMN will be helped by its presence in language interpretation services and its technology segments. Its recent investment in the Shiftwise Flex platform could also provide a competitive advantage.

SIA forecast healthcare staffing revenue to rise 6% in 2025 after a decline this year. Travel nurse staffing revenue is forecast to rise 5%.