AACN Issue Bulletin

February 1998

WITH DEMAND FOR RNs CLIMBING, AND SHORTENING SUPPLY, FORECASTERS SAY WHAT'S AHEAD ISN'T TYPICAL
"SHORTAGE CYCLE"

In a stark turnaround, the news of downsized hospitals, falling numbers of inpatients, and registered nurse layoffs that fueled media stories just two years ago has evaporated in many cities, replaced by talk of a looming nursing shortage, aggressive hiring drives, and accounts of hospitals offering signing bonuses -- some reportedly as high as $10,000 -- to lure experienced RNs.

As health care accelerates beyond the hospital to more primary and preventive care throughout the community, demand for registered nurses is climbing across an array of sites from health maintenance organizations, home care agencies, and managed care companies to primary care centers, nursing homes, community clinics, and hospital outpatient facilities. Even for inpatient departments, nursing school deans report that hospitals in several markets are finding it difficult to fill their need for RNs in key areas such as critical care, intensive care, labor and delivery, and emergency and operating rooms, while demand for advanced clinical nurses -- known as nurse practitioners -- continues to rise in acute-care units and in family health and other specialties. Indeed, the volume of ads for RNs has shot up by about 20 percent overall in the last year in Nursing Spectrum, a trade publication with six regional editions in the East and Midwest.

In particular, "what is occurring is that agencies are hiring experienced nurses, especially for critical care areas, even to the extent that experienced Canadian nurses are being recruited," explains Barbara Lust, associate dean at the School of Nursing at the University of Texas Health Science Center in San Antonio.

New graduates are finding a strong market, too, especially those who have the most education and advanced skills. While nursing schools estimate that an average of 72 percent of entry-level bachelor's- degree students had jobs waiting upon graduation between 1996 and 1997, that number was 94 percent for master's-degree graduates and 86 percent for students graduating from master's-degree nurse practitioner programs, according to the latest survey by the American Association of Colleges of Nursing (AACN). In only a six-month period in 1997, the University of California San Francisco Medical Center hired nearly 100 new nursing grads and experienced RNs, a level not seen "in years," says Jane Norbeck, dean of the UCSF School of Nursing.

Despite a wave of mergers, consolidations, and briefer lengths of stay that saw hospitals trim their ranks of inpatient RNs by 6 percent between 1992 and 1996, the number of employed RNs nationwide grew by its highest annual rate ever -- an average of more than 3 percent a year, to 2.1 million -- in the same period, according to the latest figures from the Division of Nursing of the U.S. Department of Health and Human Services. A surge in openings of front-line primary care centers, an increasing older population, and the growing needs of more patients with chronic and acute illnesses have led the Bureau of Labor Statistics to predict that RNs will see the fastest employment growth of any occupation through 2006. By that year, BLS projects, job opportunities for registered nurses will climb as much as 21 percent, compared to only 14 percent for all occupations nationwide.

Even as many hospitals cut their inpatient RN staffing, employment of RNs boomed in other hospital areas between 1992 and 1996 -- up 25 percent in outpatient and labor and delivery departments, up more than 15 percent in emergency rooms, and rising nearly 10 percent in surgical facilities, federal figures show. As a result, despite downsizings, overall RN employment in hospitals rose 3 percent in the same period. Still, observers say, more should not be confused with sufficient, since not all hospital nurses provide direct care --many practice in such areas as discharge planning, administration, or infection control -- and those who are direct care providers are treating more patients who are older, sicker, and needing more skilled nurses per patient, not fewer. In fact, federal estimates forecast that the rising complexity of acute care will increase the need for RNs in hospitals by 36 percent by 2020.

If current trends continue, rising demand will outstrip the supply of RNs beginning approximately 2010, according to Division of Nursing projections. By 2015, 114,000 jobs for full-time-equivalent RNs are expected to go unfilled nationwide. But already, in an expanding number of markets, hospitals and other employers are struggling.

"Hospitals in the area are experiencing shortages in critical and acute care and operating areas. Acute-care nurse practitioner positions remain unfilled for lengthy periods in local hospitals due to short supply," explains Sandra Angell, associate dean at The Johns Hopkins University School of Nursing in Baltimore. In and around San Antonio, "primary care centers, HMOs, managed care firms, and community health clinics seem to be the most interested in hiring the advanced practitioner and have increased hiring of graduate nurses over the last two years," says the University of Texas's Barbara Lust. Meanwhile, as facilities in Northern California try to meet their demand for family nurse practitioners, clinical specialists, and case managers, "our new grads for May and December are being offered two to three positions," says nursing dean Sarah Keating of Samuel Merritt-Saint Mary's Intercollegiate Nursing Program in Oakland.

As cost pressures swept through under managed care, "some acute-care hospitals did cut [RN staff] too far and are going back to rehire where they need to be," notes Beth Mancini, senior vice president for nursing administration at Parkland Hospital in Dallas, adding that several area hospitals are working to fill RN vacancies that are running as high as 12 percent.

In Massachusetts, some hospitals "cut too close to the bone. They're just now realizing that by getting rid of that many nurses, it wasn't cost-effective," says nursing dean Barbara Munro of Boston College. "We probably had about 10 big-time [hospital] players, just in the city," as recently as three years ago. Now, after a round of hospital mergers, "we have 3 or 4 major players," she says. To avoid duplicating services, some merged hospitals closed units and beds, cut staff either through attrition or layoffs, and "laid off many of their master's-prepared [clinical specialist] nurses, who they're now trying to get back," Munro adds. Indeed, as opportunities for RNs expand to primary care and other non-hospital settings, hospitals are facing tougher competition in recruitment.

Even in a state with sold growth in its RN workforce, the numbers still threaten to come up short. While Florida's population jumped more than 12 percent between 1990 and 1996, the number of full-time-equivalent RNs working in the state -- about 102,000 in 1996 -- grew nearly four times as much. Even so, hospitals and nursing homes there are "scrambling to fill their demand for qualified nurses," according to a report last month in the Wall Street Journal's Florida edition. If trends continue, federal estimates predict the state could have a shortfall of 20,000 full-time-equivalent RNs by 2010.

Nursing leaders worry that meeting such demand will be increasingly elusive unless the profession can turn around two vexing trends -- an aging RN workforce and slipping student enrollments in entry-level programs. Only 9 percent of the nation's 2.5 million RNs were under age 30 in 1996, the Division of Nursing reports. Indeed, the average age of RNs -- 44 -- is up from 40 in 1980, while about half of the nation's registered nurses will reach or near retirement age within the next 15 years, says Peter Buerhaus, director of the Harvard Nursing Research Institute. "Due to the aging of the workforce alone, I believe we will have a large reduction in the number of nurses in the market, a problem we haven't had to deal with in the past 20 to 30 years," Buerhaus notes in a recent interview in Syllabus, the AACN newsletter.

Moreover, 60 percent of nursing graduates in 1996 came from two-year associate-degree programs at community colleges that tend to attract older students. As a result, at 31, the average age of new RN graduates already spells fewer years in the workforce for many nurses who are now entering the profession. In addition, a shrinking cadre of new recruits is making matters worse. Although enrollments of master's-degree nursing students rose 1.6 percent between fall 1996 and fall 1997 -- part of a robust 10-year climb that has boosted the supply of nurse practitioners and other advanced clinical RNs -- the ranks of bachelor's-degree students in entry-level tracks fell more than 6 percent in the same period, the third annual drop in a row, according to the latest AACN survey.

Educators are quick to point out that falling enrollments don't necessarily mean falling interest in nursing careers. While deans at a host of nursing schools reported fewer applications for bachelor's-degree programs this academic year, others -- whose enrollments fell even when applications did not -- say other factors are to blame. Faced with too few faculty or a shortage of clinical training slots for students, some schools intentionally cut their baccalaureate admissions in fall 1997, at times shifting already limited resources to graduate-degree programs. Others saw their enrollments artificially lowered because of unusually large graduating classes the year before.

Still, in many cases, deans who see their bachelor's-degree classes dwindling say that media coverage of hospital closures, consolidations, and RN layoffs in recent years -- before the latest upswing in RN hirings -- likely stoked the decline. Negative press in other regions gave applicants the "perception" of fewer RN jobs locally, but "in reality, the class of 1997 had jobs waiting for them," says nursing dean Carole Cashion at Ursuline College in suburban Cleveland, Ohio. However, in other markets still feeling the effects of hospital cost-cutting, deans say fewer job opportunities for RNs have sent undergraduate enrollments downward.

A smaller bachelor's-degree class comes at the worst time, educators say, as more communities face steeper demand for bachelor's- and graduate-degree nurses and as federal and other policy targets call for escalating numbers of these RNs for the near future. A recent report by the National Advisory Council on Nurse Education and Practice, an advisory body to the federal Division of Nursing, urges that at least two-thirds of the basic nurse workforce hold baccalaureate or higher degrees in nursing by 2010, more than reversing the current order. Moreover, in 1995, the Pew Health Professions Commission called for the closing of up to 20 percent of the nation's associate-degree and hospital diploma nursing programs in favor of more concentrated support of Bachelor's of Science degree in nursing (BSN) and graduate-degree nurse training. Although 32 percent of RNs employed in nursing in 1996 held bachelor's degrees as their highest academic credential, an even larger 34 percent held associate degrees, 24 percent had hospital diplomas, 9 percent had obtained master's degrees, and fewer than 1 percent held the doctoral degree, according to the Division of Nursing.

It's precisely such numbers that make today's situation a different breed from past shortages, observers say. Indeed, some are skittish about calling what they see coming as the next "nursing shortage," fearing it will prompt policymakers to view it as no different than the last cycle, a pervasive shortfall of nurses in the mid-1980s, when employers scrambled to hire RNs regardless of their degree level.

What's needed today, recruiters and health planners explain, isn't simply more RNs, but more RNs in the right educational mix to handle the more complex demands of the current health care environment. Specifically, the urgency is for nurses prepared in bachelor's- and graduate-degree tracks and in a variety of high-need specialties. From case managers in California to psychiatric and gerontological nurse practitioners in Florida, employers are working to shore up their widening RN gaps in a number of nursing subfields, such as neonatal intensive care, pediatric cancer care, community health, cardiovascular care, and neurological nursing, which require specialized skills.

Asked in 1995 to predict their RN hiring for the following three years, a sample of more than 300 hospitals, home health agencies, outpatient and public health centers, and other employers in California said they intended to boost employment of BSN nurses by 9 percent and reduce hiring of associate-degree nurses by more than 6 percent, according to a survey by the California Strategic Planning Committee for Nursing.

In North Carolina, more than half (59 percent) of hospitals and almost 40 percent of community-based employers reported in 1996 that they would need more baccalaureate-trained RNs in the following two years, according to a study by the North Carolina Center for Nursing, an agency created by the legislature to do long-range planning of nursing needs for the state. Hospitals also said they likely would reduce hiring of associate-degree and diploma nurses and take on additional nurse practitioners, clinical specialists, certified nurse-midwives, and other RNs prepared in master's-degree programs, including managers and administrators.

Unlike associate-degree and diploma graduates who are prepared primarily for hospital and nursing home practice, BSN nurses have broad education in the physical and behavioral sciences, management concepts, and community health, and have the flexibility to practice across a range of settings, both inside and outside hospitals, recruiters explain. Critical thinking and leadership skills give BSN nurses an edge because they "know how to think on their feet and work fast, and can work in teams. Teams are what hospitals are all about," says Ruth Ann Morris, vice president at Saint Francis Hospital and Medical Center in Hartford, Connecticut. "Our hiring preference is for a minimum of a BSN because of the complex needs of patient care today," she adds. Boston's Massachusetts General Hospital, which prefers a BSN for its registered nurse posts, now requires the degree for new RNs in outpatient departments.

While 16 percent of associate-degree nurses have gone on to obtain the BSN, more RNs -- prompted by expanding career opportunities -- are returning to school to earn the baccalaureate degree. Between 1986 and 1997, the number of associate-degree nurses who graduated from BSN programs rose from 7,400 a year to more than 11,000 annually, according to AACN surveys. Those numbers would be even higher, some educators say, if "differentiated practice" -- whereby employers utilize RNs based on their different education and skills -- and accompanying salary differentials were instituted more widely.

A survey by consulting firm Deloitte & Touche for Modern Healthcare magazine found that while 46 percent of hospitals responding in 1995 said they planned staff cuts of 5 percent to 10 percent, only 32 percent said in 1997 that they would do so. Thirty-five percent of respondents in 1997 predicted that any staffing cuts would be less than 5 percent, up from 21 percent who responded so in 1995.

But as downsizing of hospitals apparently has slowed, so, too, has the move by many hospitals to increase their hiring of lower-cost, minimally-trained nurses aides and other unlicensed assistive personnel (UAPs). In metro Saint Louis, "the UAP thing seems to be running out of steam. At least one institution has given up on it," says nursing dean Mary Margaret Mooney at Maryville University. "Hospitals aren't saving the dollars they thought they would save."

Elsewhere, UAP hiring has "fizzled" at some agencies that were "overusing the RNs while the UAPs sit around unable to act in emergencies," says Sharon Jacques, acting head of the Department of Nursing at Western Carolina University. Further west, in metropolitan Salt Lake City, RN staffing "slid to 50 percent in some agencies" as UAP hiring accelerated over the last five years, notes dean Linda Amos of the University of Utah College of Nursing. "That seems to be reversing and some hospitals are back up to a level close to 70 percent RNs." Still, in the1996 North Carolina study, 44 percent of hospitals expected they would need more unlicensed assistive personnel over the following two years, and only a small percentage of hospitals and community facilities in the state planned to trim UAP positions in the same period.

Though some hospitals have moved to all-RN nursing staffs or have full-RN staffing in certain units such as intensive care or women's health, others maintain a mix. The profession holds to the view that there are appropriate places for UAPs to safely assist, not replace, nurses with such duties as stocking supplies or transporting patients for tests, says Beth Mancini of Parkland Hospital. What's needed is the right mix and to ensure that RNs have a voice in deciding and delegating "who will do what, when, and how."

Some facilities require UAPs to be certified, but others are looking to students to assure quality. "Our nursing students are hired as nurse techs at a local hospital. That gives the hospital a better pool of nurse assistants for patient care, and hopefully they can recruit them as graduates," says nursing dean Patricia Starck at the University of Texas Health Science Center in Houston. Similar programs are in place in Minnesota and South Dakota.

As employers scramble to hire the nurses they need, colleges are struggling, too, to boost undergraduate enrollments. The Texas Medical Center hospitals are urging schools to increase their BSN classes, UT's Patricia Starck notes. But to do so, schools will need to correct the public's outdated picture of the job market that was shaped by negative headlines as recently as two years ago, and let students know now "that the jobs are there," explains Boston College's Barbara Munro. In a recruitment drive this winter, BC's nursing school wrote to high-school students who checked off nursing as one of their career choices on the PSAT exam, inviting them to a spend a weekend on campus meeting with faculty. The college provided dormitory housing and tours of the campus and city. Of the19 students who attended, 18 already have applied for early admission, Munro says.

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