Healthcare Labor Shortages Aren’t New, But This Lawsuit Is

Commentary by Todd Perman, CCIM, Vice Chairman, Global Healthcare Services

Healthcare staffing issues have become common in the wake of the pandemic. Hospitals continue to see staffing shortages: both short-term shortages due to COVID-19 exposure, the ensuing isolation, and long-term shortages created by resignations due to burn-out and workers opting for alternative workplaces with more attractive salaries and schedules.

In January, one hospital made an extraordinary move to attempt to stop a group of its employees from leaving their jobs for another nearby hospital. The unprecedented tactic: a restraining order.

Wisconsin health system ThedaCare argued the restraining order was necessary to give the system time to create a staffing plan to replace the workers who were leaving. A judge initially granted the order, but ultimately lifted it, allowing the workers to join Ascension Northeast Wisconsin. ThedaCare’s desperate act demonstrates the increasing fallout from staffing shortages within the healthcare industry.

While the demand for qualified healthcare workers—specifically nurses—have been significant since the start of the pandemic, the supply has remained generally the same. This imbalance gives healthcare workers the power to seek ideal positions, many of which include less acute settings and lucrative short-term travel nursing positions. These travel positions have a very elastic supply, as studied in the Becker Friedman Institute’s whitepaper: When Nurses Travel: Labor Supply Elasticity During COVID-19 Surges.

We anticipate sustained medical labor market concerns as the healthcare landscape attempts to stabilize from peak pandemic-related outcomes. Hospitals and health systems will likely pursue creative, flexible solutions to achieve their ultimate goal of best serving their patients and communities.

More information on the ThedaCare lawsuit can be found here.

All information contained in this publication is derived from sources that are deemed to be reliable. However, Newmark has not verified any such information, and the same constitutes the statements and representations only of the source thereof, and not of Newmark. Any recipient of this publication should independently verify such information and all other information that may be material to any decision that recipient may make in response to this publication, and should consult with professionals of the recipient's choice with regard to all aspects of that decision, including its legal, financial, and tax aspects and implications. Any recipient of this publication may not, without the prior written approval of Newmark, distribute, disseminate, publish, transmit, copy, broadcast, upload, download, or in any other way reproduce this publication or any of the information it contains. This document is intended for informational purposes only and none of the content is intended to advise or otherwise recommend a specific strategy. It is not to be relied upon in any way to predict market movement, investment in securities, transactions, investment strategies or any other matter.

Download Our

Sign Up for Our Newsletter