Comparing the Output of Nurses with Estimated Demand

NOTE: This post has been updated with our most recent 2009 completions data. Also see this even more updated post on other issues and data involved with analyzing registered nursing.

As we mentioned in a recent post, determining demand for health care workers is far from a clear-cut process. And it gets even messier when you focus solely on registered nurses.

There are a host of factors to consider when trying to balance the supply and demand of nurses. On one hand, we know that nursing has been in very high demand as a result of an aging population, very high turnover rates, and an ever-increasing number of nursing specialties. On the other hand, the U.S. has had an extremely high output of nurses from all sorts of public and private institutions to meet this growing demand. So we have been wondering, is it possible that we are actually over-training for registered nurses?

We were prompted to do a bit of digging about this after reading an interesting article at MinnEcon, a Minnesota Public Radio-run blog on the state’s economy. Paul Tosto, the article’s author, posed a very pertinent question, not just for Minnesota but for every other state too: What’s the right number of nurses?

At the current rate, the market is producing more nursing grads than the system needs. [Minnesota State Colleges and Universities system] data show “the total supply of new nurse graduates at the professional-level (RN) from both public and private institutions has increased over the past nine years. In 2008 it reached 2,800.”

The state Department of Employment and Economic Development estimates about 2,340 openings for registered nurses each year between 2006 -2016.

Another group, Economic Modeling Specialists Inc., projects a need for about 2,577 nurses a year through 2019, according to MnSCU.

Between the two estimates, Minnesota schools are producing 9 to 19 percent more nurses than the state’s projected to need.

Those are the numbers for Minnesota. But what about the rest of the US? We used Analyst to run a comparative state-level analysis between the number of registered nurses completions for the 2008-09 academic year and projected annual openings for RNs through 2015. This gives a rough estimate of supply (graduates) and demand (openings).

Note that annual openings are the sum of new and replacement jobs (those expected as a result of turnover) from 2010-15, divided by the number of years in our projection.

Name Annual Openings 2009 Completers Difference
U.S. 105,020 190,615 85,595
California 10,492 17,933 7,441
Texas 9,415 11,376 1,961
Ohio 4,487 10,029 5,542
New York 5,318 12,527 7,209
Missouri 1,915 4,905 2,990
Pennsylvania 4,017 10,549 6,532
Arizona 1,807 6,661 4,854
Georgia 3,117 3,831 714
Illinois 4,675 6,465 1,790
Michigan 3,145 5,696 2,551
Florida 5,932 11,077 5,145
Virginia 2,673 5,192 2,519
Tennessee 2,837 4,223 1,386
North Carolina 4,088 5,403 1,315
Oklahoma 1,075 2,956 1,881
Indiana 2,316 5,241 2,925
Colorado 1,830 2,660 830
Maryland 2,202 3,562 1,360
Louisiana 1,833 2,706 873
South Carolina 1,466 3,159 1,693
Idaho 611 1,001 390
New Jersey 2,316 4,163 1,847
Minnesota 2,629 4,271 1,642
Kansas 1,156 2,378 1,222
Washington 1,972 3,293 1,321
Kentucky 1,713 3,250 1,537
Alabama 1,919 4,173 2,254
Arkansas 1,051 2,123 1,072
Nebraska 884 1,528 644
Massachusetts 2,902 4,507 1,605
Rhode Island 365 730 365
Montana 260 481 221
Maine 478 931 453
Hawaii 296 661 365
Delaware 288 734 446
Mississippi 1,239 2,269 1,030
North Dakota 222 567 345
Connecticut 1,132 1,433 301
New Hampshire 665 739 74
District of Columbia 384 399 15
West Virginia 571 1,552 981
Nevada 898 753 -145
Oregon 1,354 1,401 47
Wyoming 182 510 328
Alaska 266 199 -67
South Dakota 414 858 444
Vermont 243 330 87
Iowa 1,109 2,765 1,656
Wisconsin 2,067 3,636 1,569
New Mexico 577 1,070 493
Utah 933 1,759 826

In every state but Alaska and Nevada, there’s projected to be an excess of registered nurses in each of the next five years. In some of the most heavily populated states — Florida, Pennsylvania, New York — the oversupply is especially noticeable. Pennsylvania, for example, is projected to need just over 4,000 nurses each year in our projection. Yet it produced 10,549 RNs in 2008-09.

In 2008-09, the difference between the number of new nurses that graduated nationally and the number of estimated open nursing positions was nearly 86,000 — that’s 86,000 more nursing grads than nursing jobs.

Now, clearly the situation in most areas isn’t as out of whack as the numbers suggest: most graduates seem to end up with jobs, and there are still lots of job postings for RNs and other more specialized nurses.

There are other issues to consider as well:

  • The completers information from IPEDs is subject to fluctuations and possible double-counting.
  • As the Minnesota article outlined, there seems to be a growing percentage of RNs who opt to work part time over full time.
  • And it’s quite likely, as is the case in Minnesota, that many more people are seeking two-year nursing degrees over four-year (or bachelor’s) nursing degrees.

We’ll take a more in-depth look at these factors in future weeks. But for now, we’re curious to hear your thoughts about the output and supply of nurses. Feel free to comment below, or if you’d like to see these numbers for your specific region, email Josh Wright at jwright@economicmodeling.com or call 208.883.3500.

4 Responses to “Comparing the Output of Nurses with Estimated Demand”

  1. Mary Bennett

    Interesting data, thanks for sharing. As the director of a BS nursing program, we have not had a lot of difficulty placing graduates, even in this tight economy. However, as you noted, a lot of schools have increased the number of students admitted because we have all be warned about the impending nursing shortage due to retirements and aging baby boomers etc.

    It may be that we are now overproducing. However, I think there are some factors that should be considered. Historically there is a significant loss (5 – 10 % or more) of people from the profession within the first two years of graduation. Some overproduction is therefore needed to replace the loss. Some of the loss is due to young women deciding to become mothers and either work part-time or not at all. Others just decide that other careers might be more attractive for various reasons.

    Of course, it is easier to find a non-nursing job when more jobs are available in general. Right now, the economy is definitely affecting the way people accept positions and stay in nursing positions. Currently we are not losing as many people from the profession. I was just contacted by a 1996 grad who never worked as a nurse, did not even take the NCLEX state board exam, and now she wants to take the exam and become an RN, due to a loss of other job.

    Another factor that your data may not take into account is Associate Degree RN’s who are already working as nurses but then graduate with BSN degrees. They could be showing up on your list as new graduates, but in fact these are current RN’s who already have jobs in the system. As many as half of our graduates fall into that category. So these are not really new or additional nurses, they are just nurses with additional education. They don’t need another job opening (or if they do take a new job they leave an old job open for someone else). A final factor I can think of is RN’s who continue their education and become nurse practitioners or nurse educators ect. They still show up as being RN’s, but they are leaving bedside nurse to enter advance practice or educational roles. These two areas are still having significant shortages and RN’s are returning for advanced education to take these positions.

    I think the numbers right now may be misleading, partly due to an underestimation of the real number of jobs open in all of the areas of nursing, an over estimation of the true number of new nurses being produced, and due to the effects of current economy on nursing workforce retention. When the economy turns around we will see people retiring, working part-time rather than full time, and nurses optioning out of nursing again. I would hesitate to make system wide changes in our educational production until we can see how the economic turnaround affects the job market and how the health care system responds to the increased number of persons who will have access with the new health care reform legislation.

  2. Joshua Wright

    Mary,

    Thanks for your observations. There are definitely limitations to the data, and I think you are right that the recession has taken its toll — both on new nursing grads and nurses who opt to stay in their positions longer than they might in other economic conditions.

  3. Patrick Budny

    Unfortunately I would have to disagree with these findings for a few reasons.

    1.) IPEDS numbers are not very reliable for the point you are attempting to get across.

    Mary eluded to my concern in her email above. If you are looking at Completions on IPEDS they include RN to ASN, RN to BSN, RN to MSN completions in their data set. These are people who are in fact usually working and taking these accelerated programs on-line. The enrollment in these programs is growing exponentially. So right there your supply and demand numbers are skewed.

    2.) You are interchanging the definitions of Nursing Degree Completers with Registered Nurses. One has to sit and pass the NCLEX to become a registered nurse. You would be best served on replacing the IPEDS completion numbers with first time NCLEX passing students. That number would best reflect the number of new grads who are entering the marketplace.

    Let’s take Texas for example. According to their Board of Nursing website in 2009 7,413 candidates passed the NCLEX for the first time. There are 9,415 annual openings for that state according to your table. That still leaves a shortage of about 2,002. Now that doesn’t take into account intramarket churn but it paints a different picture.

    Hope this post was helpful and best of luck with your future nursing workforce data reports.

    Best,
    Pat

  4. Jen Nooney

    The National Forum of State Nursing Workforce Centers, the nurse workforce experts from 30+ states, is concerned about a recent study conducted by Economic Modeling Specialists, Inc. (EMSI) suggesting that the nation is currently over-producing RNs. We offer remarks on the study’s data sources and on the possible consequences of publicizing misleading information. The original study can be found at http://www.economicmodeling.com/2010/06/11/comparing-the-output-of-nurses-with-estimated-demand/

    Regarding the data:

    Supply-side estimates of new nurse production are based on data from the federal Integrated Postsecondary Education System (IPEDS). IPEDS data do not separate pre-licensure from post-licensure students, so it is not possible to count new nurses separately from post-licensure students returning to complete a higher degree (baccalaureate, master’s, or doctorate). Additionally, IPEDS counts are produced using a program-to-occupation crosswalk that may misclassify some educational programs whose graduates typically go into other fields.

    A better measure of new entrants to the profession comes from the National Council of State Boards of Nursing NCLEX examination statistics. Even if IPEDS were a good source for data on the number of pre-licensure graduates, new graduates cannot legally practice until they pass the NCLEX-RN exam. A comparison of the two sources shows the extent of the discrepancy:

    o EMSI # of “nursing completers” in 2009: 190,615
    o NCSBN # of people passing NCLEX in FY 2009: 148,266
    o Difference: 42,349, an overestimate of 28.6%

    Demand-side projections of job openings due to growth and replacement seem to be based on Bureau of Labor Statistics employment projections, though the exact source of data for these estimates is not clearly stated on EMSI’s website. BLS projections of nurse demand have a number of limitations. In fact, federal forecasts of nurse demand produced by the Health Resources and Services Administration (HRSA) use a completely different forecasting method.

    BLS projections of employment assume a labor market in balance; labor shortages or surpluses are not modeled. They are projections of employment, not necessarily total demand for nurses. Since unmet demand for nurses (in the form of vacancies) exists in the historical employment trends projected forward, BLS may be underestimating the total demand for nursing labor.

    BLS occupational projections use a methodology designed to maximize accuracy across the many industries they study. This allows broad comparisons across industries that are useful for understanding the nature of national economic growth in the coming years, but the method is not specific enough to the nursing profession to produce accurate projections of total demand. Like IPEDS, BLS uses a crosswalk to convert industry employment to occupational employment. The process is subject to error.

    National nurse workforce experts have consistently projected a shortage of RNs owing to an aging population and eminent retirements from the aging nurse workforce. The recession has temporarily eased the current nursing shortage by increasing the supply (more licensed nurses are working in the field) and decreasing the demand (fewer vacancies in healthcare facilities). The long-term drivers of shortage, however, are still in place. Peter Buerhaus and colleagues (2009) project that a national shortage will re-emerge by 2018 and grow to approximately 260,000 RNs by 2025. To prevent that shortage, funding decisions must acknowledge the coming problem. When researchers who are not experts in the field create and publicize projections that not only deny the coming shortage but posit that a surplus of nurses is in our future, dangerous funding decisions may be made. For example:

    • Reducing the capacity of our nursing education system now may have long-term consequences for our efforts to prevent a nursing shortage. Nursing programs cannot start and stop on a dime; it takes years for the flow of a curriculum to become established and the production of quality graduates to be achieved. If we reduce funding for nursing education now, our education system will not be able to produce the nurses we need in the future.

    • Employers have been incentivized by the recent shortage to explore improvements in the nursing work environment. Nursing turnover – both job turnover and professional attrition – is impacted by factors such as workload, participation in organizational decision-making, and opportunities for career advancement. Changes to the work environment can be costly and time-consuming, but they pay off for organizations through reduced turnover expenditures and retention of valuable experiential knowledge. If focus on the work environment is shifted because of employer perception that nursing labor will be easy to find, the result will be an intensified nursing shortage owing to high levels of professional turnover.

    The National Forum of State Nursing Workforce Centers encourages those involved in nurse workforce policymaking to consult national and state-level nurse workforce experts for information on nursing workforce availability and demand. Our subscriber state centers are typically the best state-level source for information. Visit our interactive map at http://www.nursingworkforcecenters.org/WorkForceCenters.aspx to find your state center for nursing.

    Reference: Buerhaus, P., Auerbach, D., and D. Stiger. (2009). The recent surge in nurse employment: causes and implications. Health Affairs, 24(4), w657-w668.

    For more information about the Forum of State Nursing Workforce Centers visit http://www.NursingWorkforceCenters.org.

    Contact:
    Linda Tieman, RN MN FACHE
    President, Forum Board of Directors
    lindat@wcnursing.org