Almost three years from the start of a pandemic that upended healthcare across the globe, the industry is still struggling to recover. Operating margins are at an all-time low, labor shortages are increasing staff and executive burnout, and frontline workers are more readily organizing and striking for higher pay and better staffing conditions. With labor costs continuing to rise and facilities working to get back to pre-pandemic operations, experts say health systems will face significant ongoing challenges in 2023.
Staffing shortages are expected to continue, especially among nurses, as wide-ranging burnout and high turnover continue to pound the sector. Though severe COVID hospitalization rates have declined steeply since the worst days of the pandemic, healthcare operators have continued to make use of expensive contract nursing labor to fill staffing gaps, with the national average weekly pay for travel nurses sitting at $3,173 in December 2022, up from $1,894 in January 2020. Those rates are expected to remain fairly static without another COVID wave, with demand for contract nursing to normalize at about 60% higher than 2019 levels.
The pay differential between contracted temporary staff and full-time staff is continuing to put pressure on health systems, with in-house nurses becoming significantly less shy about demanding wage increases. Healthcare workers in all roles have been active in labor organizing efforts, with a number of large-scale strikes making front page news, winning greater pay and guaranteed staffing levels. Resident physician organizing has grown in recent years as well, according to the Committee of Residents and Interns, a branch of Service Employees International Union. It currently represents about 25,000 members and has won five union elections in 2022 and four in 2021, up from one in 2020 and two in 2019.
While it has been a well-known fact that frontline healthcare staff have faced the worst impacts of the pandemic on their industry, reports are growing that even healthcare executives are feeling increasingly burnt out, with some even considering career changes. A December 2022 study by consultancy WittKieffer found that nearly three-quarters of surveyed executives reported feeling burned out in the latter half of 2022, up from 60% of respondents who felt the same way in 2018.
In spite of the waning pandemic, it is clear that the healthcare industry is in for a tough 2023. With workers feeling pain at all levels of the organization, health system operators will need to carefully balance a focus on recruiting and retention while maintaining the bottom line, ensuring that patients do not bear the worst.
