Everybody Likes Nurses . . . Nurses USA
In June during the REMI webinar, I discussed the potential labor supply shortage for four-year degree workers in the construction industry. At the time, I suggested other occupations in Maryland that could experience this problem in the next few years. Naturally, my first thought was registered nurses (RNs)—many hospitals are beginning to require nurses to have four-year degrees and more training. Another growing issue is that the baby boomer population is now reaching retirement age. These issues, combined with the increase in health insurance access from the Affordable Care Act (ACA), are causing many economists to wonder if there is enough supply in healthcare fields such as nursing to meet new demand. Dr. Joanne Spetz suggests that these factors won’t increase the demand for registered nurses in hospitals but rather the demand for in-home care and physicians. If this is true, then Maryland really needs to think about how it will handle the needs of an aging population in the coming years.
The Wave of Retirees
As the baby boomers begin to reach retirement age, the main question for many states is the size of the oncoming wave. Will it be a ripple or a tsunami? To answer this question, RESI data mined its REMI PI+ demographic forecast to analyze the current projections for those 65 years of age and older in Maryland over the next three years.
|Population 65 and older||2015||2016||2017|
Source: REMI PI+ v1.7.2
According to the projections in the table above, Maryland is expecting an average annual increase of 3.7 percent of those aged 65 and older over the next few years. Many of these individuals will most likely seek medical care for regular doctor visits and, at some point, home health assistance. As noted by Dr. Spetz, the growth potential in the RN field will be more focused on the change in the size of the older population than changes from the Affordable Health Care Act.
Forecasting the Impending Storm
As the impending tidal wave begins to reach Maryland’s healthcare industry, the underlying question regarding who will provide care remains. Preparing for the oncoming surge means that economic forecasting will need to consider not only changes in jobs but also specific occupations. Many economic development professionals are beginning to ask if there are ways to focus economic analysis to the occupational level. In many cases, some input/output tools do not provide this level of detail. In some cases, the percentage of occupations by industry matrix by state is not disclosed, and thus projecting at the occupational level can be difficult. However, many states are beginning to look at occupations as a percentage of industry jobs. For example, Ohio has a great tool for economic development agents trying to gauge the level of industry jobs and the associated types of occupations that the state can expect to grow.
While helpful, Ohio’s tool lacks the ability to tell economic development officers about the occupational growth they can expect given a change in employment next year. This need is where innovation grows. RESI aimed to build a tool outside its REMI PI+ tool to combine industry codes (NAICS) and occupational codes (SOC). RESI’s tool, which has yet to be named (but suggestions welcomed!) takes REMI PI+ results and dives into the underlying occupations associated with those results. Looking at the jobs forecast for Maryland over the next three years, RESI used this tool to estimate the annual increase in the number of registered nurses.
|Percentage demand met by Maryland graduates||78.6%||64.5%||63.2%||68.7%|
Sources: RESI, REMI PI+ v1.7.2, MHEC
Using RESI’s tool, RESI determined that, over the next three years, Maryland will need 3,671 new registered nurses. According to the previous table, the 65 and older population will grow over the next three years by 95,471 individuals. These figures equate to Maryland needing at least one new RN for every 26 new members of Maryland’s retirement-aged population over the next three years. As of spring 2014, Towson University awarded nearly 186 Bachelor’s degrees in nursing. If Towson University graduates 200 nurses this year, the percentage of total demand being met by these graduates is potentially only 10 to 15 percent. This prospect is something other institutions such as Frostburg State University have realized, as the university picked up $2.5 million in grants to grow its program for transitioning those with two-year degrees to four-year degrees as registered nurses and develop a Master’s program. However, according to MHEC estimates, if the average rate of degrees awarded over the last four years holds constant, then Maryland will need to outsource 31.3 percent of its nursing demand to graduates from outside the state.
Catching the Wave
As Maryland’s retirement-aged population continues to grow and the supply of nurses is outpaced by demand, what should Maryland’s next steps be? Integration of economic development tools such as RESI’s tool is a beginning step, but the keyword is partnerships. Connecting local healthcare providers with institutions and programs will be key in making sure the workforce can keep up with demand. Building programs that offer flexible continuing education units for registered nurses to retain their credentials combined with detailed occupational forecasts can help decision makers get ahead of the wave instead of being engulfed by it. As economic development officers begin to think of ways to reshape the labor force, understanding the occupations within the labor market will be key in remaining afloat through economic expansion and change.