Nurse salaries on the rise amid higher demand for their services

Nurses are winning raises worth thousands of dollars a year from hospitals, the latest employer reckoning with a tight labor market. 

HCA Healthcare Inc., HCA +2.04% one of the nation’s largest hospital chains, increased nurse pay this year to handle heavy Covid-19 pandemic case loads and keep pace with rivals that are also trying to fill vacancies and hold on to existing staff, the company’s human resources chief said. Raises varied by market; an HCA spokesman declined to say by what amounts. 

Other hospitals say they have raises in the works to keep up with competitors’ offers. A small Missouri hospital desperate for nurses this month raised nurse salaries by up to 5% after hospitals nearly 40 miles away boosted wages. 

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"We were forced to," said Sarah Hanak, chief nursing officer at Citizens Memorial Hospital in Bolivar, Mo. "We absolutely have to stay competitive." 

The average annual salary for registered nurses, not including bonus pay such as overtime, grew about 4% in the first nine months of the year to $81,376, according to healthcare consultants Premier Inc., which analyzed salaries of about 60,000 nurses for The Wall Street Journal. 

That is up from the 3.3% increase in average annual nurse wages in all of 2020 and 2.6% growth the year before the pandemic, according to the U.S. Department of Labor. 

The nation’s $1 trillion hospital sector is among the U.S. economy’s largest to be squeezed by upheaval across its workforce and strong demand for services following rollout of vaccines and an economic rebound. Similar disruption across sectors in retail, transportation and hospitality is also raising their workers’ wages and job prospects. 

Nurses have played a critical role during the pandemic, tending to Covid-19 patients flooding emergency rooms and filling hospital beds, in addition to their work with more typical patients. 

The need for nurses has risen so high that many have been able to make even better livings by leaving hospital payrolls and instead hopping between temporary jobs seeking emergency staffing, hospital recruiters and executives say. 

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The changes have pushed up turnover and job openings at hospitals, leading to chronic staffing shortages as Covid-19 cases keep coming and many patients who had postponed care for other conditions seek treatment. 

"We are employing more nurses now than we ever have, and we also have more vacancies than we ever had," said Greg Till, chief people officer at Renton, Wash.-based Providence health system, which operates 52 hospitals across seven states largely in the Western U.S. 

Nurse turnover rates have increased to about 22% this year, compared with an annual rate of around 18% in 2019, the last year before the pandemic, says Premier. 

For many hospitals, higher labor costs threaten to crimp already tight margins. As a result, some may curb services to tighten expenses, or seek higher prices from health insurers to help cover the additional labor costs. 

Nurses, meanwhile, have been able to take advantage of their increased clout. Some have secured more flexible work schedules, according to recruiters, nurses and hospital executives. 

The Providence system, which has raised some nurses’ wages to keep their salaries competitive, is offering nurses more time off and greater schedule flexibility to combat burnout, new career development opportunities and other nonsalary perks to attract and retain staff, Mr. Till said. 

Other nurses have advanced their careers faster than they would have, employers say. And they say new graduates, who once needed experience and training before hospitals would hire them to work in the operating room or perform other specialized roles, are now a growing share of new hires. Hospitals are doing more on-the-job training as a result.

"I think you get to write your ticket," said Tessa Johnson, president of the North Dakota Nurses Association.

Jefferson Health, which has 18 hospitals in Pennsylvania and New Jersey, raised salaries 10% for its nearly 10,000 nurses in May after the system found rivals had increased compensation, said Kate FitzPatrick, who became the system’s chief nurse executive in January. "The circumstances required it," she said.

Some new recruits out of nursing schools, seeing Jefferson’s salary offers, have asked, "Are you sure that’s not a typo?" said recruiter Tierra Seay. Yet others have rejected the offers as too low and didn’t take a job with Jefferson, she said.

Nurse Stephanie Fernandez entered the job market this spring, using LinkedIn.com to notify prospective employers. Recruiters eagerly contacted her, including temporary-agency recruiters who tracked down her phone number and called out of the blue, she said.

"Everybody and anybody wants you," Ms. Fernandez said. She chose Jefferson, where she now cares for transplant patients, because of its Philadelphia location and because its salary offer beat out other potential employers, she said. She declined to give her salary.

Citizens Memorial, the southwestern Missouri hospital, raised salaries for all nurses by up to 5% this month after minimum-wage increases made by rivals in the larger city of Springfield forced Citizens to up the hourly wages of custodians and kitchen staff.

Citizens didn’t want newly hired nurses to leave because the gap between their salaries and minimum wage had narrowed, Ms. Hanak said.

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Now, Citizens is trying to make sure it has enough nurses to fill overnight shifts. To do so, Ms. Hanak said she has asked the hospital’s chief executive to give nurses who work night shifts an increase of about 15% an hour.

It also may soon need to boost nurse wages again because Mercy health system, which owns one of the Springfield hospitals, is reviewing nurse salaries at rival hospitals every six months to stay competitive, said Betty Jo Rocchio, Mercy’s chief nursing officer.

This article first appeared in the Wall Street Journal