Feb. 25, 2022: Hospitals Confront Rising Staff Vacancy Rates and Employment Costs as COVID Sparks Unprecedented Workforce Challenges

New Jersey hospitals are feeling the impact of the nationwide workforce shortage, with an industry survey showing rising staff vacancy rates even as hospitals triple their spending on supplemental staffing from traveler and agency nurses.

The New Jersey Hospital Association completed a survey of the state’s hospitals in early February to gauge how the workforce shortage that has struck virtually every employment sector has specifically challenged hospitals. NJHA’s Center for Health Analytics, Research and Transformation analyzed the responses, gathered from 70 percent of the state’s hospitals. Its report, Healthcare Employers in Dire Need of an Expanded Workforce Pipeline, shows that:

  • For registered nurses, the vacancy rate increased 64 percent, from 8.2 percent in 2020 to 13.4 percent in 2021. The vacancy rate measures the number of unfilled positions relative to the total number of employees.
  • The vacancy rate for nurse extenders (which include positions such as certified nurse aides) increased 37 percent, from 12.4 percent in 2020 to 16.9 percent in 2021.
  • The reliance on agency registered nurses increased 66 percent, from 3.6 percent in 2020 to 6.0 percent in 2021.
  • For nurse extenders, the reliance on agency staff increased 68 percent, from 2.9 percent in 2020 to 4.9 percent in 2021.
  • Hospitals spent approximately $499 million for overtime in 2020 and are projected to have spent approximately $592 million in 2021.
  • Hospitals spent approximately $222 million for agency and traveler staff in 2020 and are projected to have spent more than three times that amount – $670 million – in 2021. This represents an increase of 202 percent in just 12 months.

“Hospitals have always faced cyclical staffing shortages, but the disruptive force of COVID-19 has created an unprecedented workforce plight across the entire continuum of care,” said NJHA President and CEO Cathy Bennett. “Providers and policymakers have adopted short-term strategies to get us through the public health emergency, but it will require a coordinated strategic investment to rebuild the pipeline and bring people into these critically important jobs.”

These discussions must include assessing and implementing curriculum changes, opening more education slots for students interested in healthcare, increasing healthcare faculty, recruiting healthcare workers from disadvantaged communities and creating pathways so that healthcare is recognized among diverse groups for its meaningful, stable employment opportunities.