There are many great reasons people decide to pursue a career in healthcare, such as good pay and the opportunity to make a difference in people’s lives. However, despite these benefits, employee retention in healthcare is a major issue that ultimately affects the quality of patient care.
Many healthcare staff, such as registered nurses and physician assistants, often work long hours due to staff shortages. Some other factors that lead to employee turnover include dissatisfaction with workplace culture, lack of appreciation, and burnout.
And it seems to be getting worse. Turnover rates in healthcare institutions have increased over the past few years. The 2022 NSI National Healthcare Retention & Staffing Report notes that the average hospital turnover rate during the 2021 calendar year was 25.9%. This is a marked increase compared to the past 5 years.
Fortunately, there are some things you can do to improve employee retention in healthcare, which this guide will go over. Here are some retention strategies that can help reduce employee turnover.
1) Offer Competitive Salaries & Annual Raises
Competitive salaries help attract quality candidates. In addition, they help deter current employees from looking around for similar positions that may pay more.
Bain & Company’s 2022 survey found that one of the most important job criteria for clinicians was good compensation. Making an effort to provide employees with a competitive salary shows that you value their work and skillset.
A competitive salary will depend on several factors such as location, position, and average salaries. One way to get a feel for what a competitive salary might be is by seeing what other local healthcare facilities are offering for the same positions.
Annual raises also provide employees with a strong financial incentive to stay. Recent issues with inflation have made annual raises a convincing selling point for employees. Not to mention, they are a great way to show your employees your appreciation for their hard work and dedication to your organization
2) Offer Bonuses
Bonuses are also a great financial incentive for employees. Bonuses offered upon hiring can help make a positive first impression.
Other bonuses can motivate employees to work hard and stay committed to their organization. Some types of bonuses include:
- Sign-on Bonuses. These are offered to employees who accept a job offer and are fairly common in the nursing field. They can be an especially strong incentive for newly graduated nurses.
- Referral Bonuses. These bonuses are given when an employee refers another job candidate that ends up getting hired. This can help recruit quality talent for the healthcare facility. As with sign-on bonuses, these are also fairly common in the nursing field.
- Performance Bonuses. Some workplaces evaluate their employees and reward them based on their performance.
- Holiday Bonuses. These are usually given during the holiday season in the winter. They are an excellent way to boost employee morale and recognize hard work.
3) Offer Great (& Unique) Benefits
Employees value benefits such as retirement plans, health insurance, vision insurance, dental insurance, and paid time off. These all contribute to increased workplace satisfaction and quality of life.
In fact, the importance of great benefits was emphasized in a 2022 survey conducted by the American Nurses Foundation. It showed that 76% of registered nurses surveyed listed medical and dental insurance as one of their top three most important benefits. Other popular responses included retirement benefits (58%) and employer retirement match (52%).
You can consider offering unique benefits like pet insurance or student loan payment support to differentiate your healthcare facility from others.
In addition, resources such as mental health support and burnout prevention workshops can be useful for employees, especially when considering the often stressful nature of a healthcare career.
>> Learn more: Common Medical Assistant Benefits
4) Offer Training & Continuing Education Opportunities for Employees
Training is essential for setting up employees for success. Inadequate training can lead to costly mistakes, feelings of incompetence, and workplace resentment.
It is important to ensure that new employees are well-trained for all their job duties and on workplace policies.
Continuing education (CE) is often a requirement for many healthcare careers, such as registered nurses. One of the rationales for CE is that it helps expand employees’ knowledge, leading to better patient care.
Providing easily accessible opportunities for both of these can help provide an incentive for employees to stay with your organization.
We have a four-part series that goes over how to decide if an employee upskilling program is right for your organization and how to set one up:
- Part 1: What are Entry-Level Healthcare Workers Looking for from Employers | How to Attract Talent
- Part 2: ROI of Upskilling Entry-Level Healthcare Employees & Deciding If It’s Right for You
- Part 3: How to Set Up an Upskilling Program for Healthcare Employees
- Part 4: How to Choose Healthcare Training Programs: Rubric for Evaluation
>> Learn more: Nursing Retention Strategies
5) Avoid Staff Shortages
Healthcare staff shortages is a multifaceted issue related to recruitment and education on a system-wide level. Staff shortages are also a major contributing factor to employee burnout. Fortunately, staff shortages can often be addressed on a smaller company-wide scale.
A 2022 survey conducted by the American Nurses Foundation showed that 50% of registered nurses felt that they were understaffed at least half of the time they were working. In addition, 59% of registered nurses surveyed felt that an “increase in the number of nurses and support staff” would improve their job satisfaction.
Staff shortages can also lead to negative patient outcomes. One study found that reduced staffing of nurses during shifts was associated with a 10% increased risk of inpatient mortality.
In certain situations, hiring less staff may be a reasonable cost-cutting move. However, there are many drawbacks that need to be taken into consideration. Most notably, it can place an excessive workload burden on employees. Over the long-term, this can reduce employee morale, lead to burnout, and eventually result in increased employee turnover.
Finding the right number of staff to hire means striking a delicate balance between employee workload and organizational expenses. To avoid staff shortages, there must be enough employees to provide care for the volume of patients seen. This will help ensure that everyone can perform their duties at an acceptable level.
Another way to avoid staff shortages is by making schedule adjustments, such as creating overlapping shifts so that there are less times when the office is understaffed.
6) Keep Up With Technology
Advances in technology can help make healthcare workers’ jobs less stressful and reduce workplace burnout. Some examples include transitioning to more user-friendly electronic health record software or upgrading outdated office equipment.
Other kinds of technology, such as flexible scheduling software can make it easier for employees and supervisors to manage everyone’s schedules.
7) Offer Flexible Working Schedules, if Possible
Long hours and daunting schedules are commonplace in many healthcare careers, such as nursing. Offering flexible working schedules allows for some compromise, which may improve work-life balance for employees.
In a flexible scheduling system, employees have more control over their schedules. For example, employees may choose to work 12-hour shifts or 8-hour shifts based on their preferences. In addition, start times may be staggered to give employees time to take care of personal needs.
In the end, offering flexible schedules can result in several benefits such as reduced burnout, increased job satisfaction, more engaged employees, and less employee turnover.
8) Create a Positive Company Culture
A positive company culture is key for helping employees stick around. Having happy employees leads to increased productivity, decreased employee turnover, and ultimately better patient care.
Building a positive workplace culture is like watering a plant—it requires regular care to grow. In other words, it is not enough to establish a culture. The culture needs to be actively maintained.
Some ways this can be achieved include being consistent with your messaging and communication, checking in with how your employees feel, and by taking meaningful action when needed.
9) Show Appreciation for Your Employees
Employees may feel like all their hard work goes unrecognized amidst the daily grind. This can be especially true for entry level positions like medical assistants, technicians, and front desk staff.
Putting in the effort to show your appreciation for your employees goes a long way towards improving morale.
The simplest way to do this is by verbal acknowledgement such as “That’s a great idea, thanks for bringing it up!” or “I know it was busy today, but you did an awesome job keeping everything on track.”
Some other fun ways to show your appreciation include providing snacks and coffee during meetings or giving gift cards to employees who do a particularly good job. You can even be creative and have employee of the month awards or let them help decorate the break room.
10) Gauge How Your Employees Feel
Taking the temperature of the workplace is important to see if there is anything negatively impacting employee morale and performance. One typical complaint regarding poor management is that they do not listen to and address employees’ concerns.
One simple way to get a better gauge of how your employees feel is by asking for feedback. Ideally, this is done anonymously though means such as a “feedback box” or an online form. That way, employees can provide candid feedback without fear of retaliation.
Another way is by implementing an “open door policy” where employees can build a rapport with their supervisors and communicate their concerns without judgment or scrutiny.
Exit interviews can also provide useful information about how employees feel about your organization.
Why Healthcare Employees Most Often Leave
To effectively combat employee turnover, it is essential to have a strong understanding of why employees leave. Here are some of the most common reasons why healthcare employees may choose to leave the field:
- Inadequate compensation. Bain & Company’s 2022 survey revealed that the most important job criteria for clinicians was “compensation”, with 62% of those surveyed listing it as one of their top three.
- Issues with management. Poor management can make employees feel isolated and ignored. Feeling resentful towards management is a common reason why employees may start looking elsewhere for work.
- Burnout. Burnout has a profound impact on healthcare employees’ mental health, job satisfaction, and productivity. Burnout is a multifactorial issue. In a nutshell, it can be described as feelings of mental and physical distress caused by prolonged exposure to stressful work conditions. In 2022, Bain & Company surveyed physicians, nurses, and other healthcare workers who were considering making a career switch. They found that 89% of those surveyed listed burnout as the primary factor driving their potential career change.
- Toxic workplace culture. In a toxic workplace culture, employees can feel disrespected, agitated, and even bullied. They can feel like their hard work always goes unrecognized, that they are unfairly chastised for mistakes, or that they cannot trust their coworkers. This type of environment can be caused by several things such as bad employee behavior, ineffective management, and poor workplace policies. Though it is obvious that a poor workplace culture leads to employee turnover, creating and maintaining a positive work environment is much easier said than done.
Why Healthcare Employee Turnover is a Problem
Healthcare employee turnover is a critical issue that affects all parts of the system, including finances, other employees, workplace culture, and patients.
Here are some reasons why healthcare employee turnover is a major problem:
- Reduces quality of patient care. High employee turnover can lead to poorer patient outcomes. The lack of consistency and continuity among employees can lead to more mistakes and less effective care.
- Costly. The cost of recruiting, hiring, and training new employees can be expensive. If a healthcare practice has to do this frequently, it can add up quite fast, leading to significant financial strain. Another possible expense is time, as it can take an extended amount of time to orient new employees.
- Damages workplace culture. Excessive employee turnover reduces the opportunity for employees to develop a working rapport with each other. It quickly becomes difficult to maintain a consistent workplace environment when employees are constantly cycling in and out of your facility. In addition, a high turnover rate may create the impression that the workplace is not good, which can influence other employees to start to consider finding a new job.
Healthcare Employee Turnover Rates & Other Data
The 2022 NSI National Healthcare Retention & Staffing Report collected data regarding current healthcare employee turnover rates and trends. Although the data emphasized registered nurse (RN) turnover rates, it also provided some insightful information about turnover rates for related allied healthcare careers.
Healthcare Positions With Higher Rates of Turnover
The survey collected data on healthcare positions with higher rates of turnover. In 2021, three positions had turnover rates greater than the average hospital turnover rate of 25.9%:
- Patient Care Technicians (PCT) had a turnover rate of 38.1%
- Certified Nursing Assistants (CNA) had a turnover rate of 35.5%
- Registered Nurses (RN) had a turnover rate of 27.1%
Turnover Rates by Years of Tenure
The survey also examined turnover rates by years of tenure with the organization, with the following notable findings:
- 36.3% of turnover occurred with employees who had less than 1 year of tenure
- 54.4% of turnover occurred with employees who had less than 2 years of tenure
- Turnover rates were lower at 11.2% for longer tenured employees (greater than 10 years)
Financial Costs Due to RN Turnover
The above survey also noted the financial costs incurred due to RN turnover. These come from the expenses related to recruitment, hiring, onboarding, and training. Here are some of the key findings:
- Each RN turnover cost an average of $46,131
- The average annual cost of RN turnover was $7.11 million
- A reduction in RN turnover by 1% resulted in average annual savings of $262,289
Most Difficult Healthcare Positions to Fill
Indeed analyzed their listings for healthcare jobs that remained unfilled 60 days after posting. They reported that the most difficult healthcare positions to fill were:
- Nurse practitioner
- Agency nurse
- Emergency medicine physician
- Vascular surgeon