Healthcare staffing has been on a roller-coaster ride.
Projected industry revenue this year is three times the pre-pandemic level, SIA President Barry Asin said in a speech today at the Healthcare Staffing Summit in Las Vegas. And while growth has tapered off this year from the high reached in 2022, healthcare staffing’s future continues to be bright.
Healthcare staffing has been “driven by the ongoing talent shortage, lit on fire by a global pandemic with a heap of digital disruption thrown into the middle that makes the industry more transparent,” Asin said.
Healthcare staffing’s projected revenue this year of $55.7 billion is down from the estimated $68.7 billion last year — which was itself up from $47.5 billion in 2021. But in the long term, demographics are in the industry’s favor and digital transformation and emerging models are providing tail winds.
“We have a bubble of some sort,” Asin said. “The question is how big is that bubble? And the air — certainly over what we’ve seen over the last bit — has started to come out of that bubble, so here we are today. I’d say we’re back to the future. We’re in some new reality, the next stage of the development of this industry.”
Here are a few points Asin made in his talk:
- Much of the explosive growth in healthcare staffing occurred in travel nursing. Revenue in this segment rose to $42.7 billion in 2022 from $18.9 billion in 2019. However, revenue is projected to ease this year to $29.9 billion.
- Hospitals noted a 258% increase in contract labor spending from 2019 to 2022, according to statistics from the American Hospital Association. And legislators have taken note of hospitals’ concerns with added regulations. As of summer 2023, 20 states had licensing requirements with five states having reporting requirements.
- A majority of nursing staffing firms experienced layoffs in the second and third quarters of this year. SIA research has found that 63% of per diem nursing firms and 52% of travel nursing firms recorded layoffs.
- Looking to the future, US demographics are in healthcare staffing’s favor with slower growth in the US workforce as the population ages and needs more healthcare. The shortage of workers and increased need for healthcare will put a premium on recruiting and retaining workers. Burnout among healthcare workers, limited training and immigration for new workers are also factors.
- Platform technology is on the rise with healthcare staffing platforms growing at roughly twice the rate of traditional staffing. Younger generations of travel nurses are also more likely to use staffing platforms.
- AI is also big. A Delphi panel of experts convened by SIA expects AI to replace 39% of staffing tasks in the next three years.
- There is growing client interest in direct sourcing and talent pools/float pools. An SIA survey of buyers — not just healthcare clients — found that 39% have a direct sourcing program in place today.
The Healthcare Staffing Summit continues through Friday.