According to a report released by the
American Health Care Association in July 2008, more than 19,400 RN vacancies
exist in long-term care settings. These vacancies, coupled with an additional
116,000 open positions in hospitals reported by the American Hospital
Association in July 2007, bring the total RN vacancies in the U.S. to more than
135,000. This translates into a national RN vacancy rate of 8.1%.
The
True Cost of Temporary Staffing
Google
the phrase “temp staff costs” and you will find results dominated by staffing
firms intent on convincing you that, among other things, temporary staffing is
a good ROI. But no Phoenix University MBA is required to figure out that $70 to
$100 per hour (twice the actual cost of permanent employees) is a particularly
bad investment. In fact, dozens of case studies have demonstrated that the
average mid-size hospital could save between $1 and $6 million annually, simply
by eliminating locums.1 So why
does it persist as a major plank in the staffing strategy in nearly every
facility in America?
The
reason is obvious: Hospitals struggle to
attract and retain enough permanent staff. And the costs are more than dollars and cents.
Here are just a few of the costs of chronic use of locums:
·Impact of casual labor on continuity of care
·Reduced ability to implement key initiatives due
to turnover
·Increased risk exposure and concerns about
patient safety2
·Poor employee morale and workplace satisfaction
among nurses and physicians
·Poor employee performance
·Low patient satisfaction
First
Solutions:
1.Determine
the true cost of temporary staffing in your facility (see below)
2.Initially
outsource recruitment to specialists to immediately eliminate temp staffing and
to consult on recruiting cycle improvements3
3.Develop
a long term recruitment and retention strategy that views everyone as part of
the recruitment and retention team
Temporary
Staff Cost Calculator:
·# ____ of temporary staff X ________ average agency bill rate = $ __________________
·# ____ of temporary staffX_______average cost per hour of RN =--$ __________________
=$ __________________
NOTES:
1 Visit this page to read the stories of dozens of facilities that saved
up to $6 million annually by eliminating temp staffing.
2 Check out this shocking expose by the LA Times of temp staffing
quality issues in the State of California
3 Simple improvements such as a 24 hour
interview/offer cycle and changing the role of Nurse Managers in therecruitment process can result in dramatic increases in
recruiting success
