A Shortage of Registered Nurses: Is It On the Horizon or Already Here?
CRS Report for Congress
A Shortage of Registered Nurses:
Is It on the Horizon or Already Here?
Updated August 19, 2002
Specialist in Labor Economics
Domestic Social Policy Division
Congressional Research Service ˜ The Library of Congress
A S hortage of Registered Nurses:
Is It on the Horizon or Already Here?
Labor shortages i n v arious occupations and i ndustries were reported during t he
late stages of the n ation’s l ongest ec onomic ex pansion, which ended i n early 2001.
The unemploym ent rate i n s ome fiel d s ( e.g. , nursing) h as remained virtually
unchanged despite the advent of the recession, which s uggests t hat t here are factors
unrel at ed to the busines s cycle affecting t hem. For ex ample, t he increas ing l ongevity
and wealth of the population combined with a growing share o f elderly persons are
putting added pressure on the health care delivery s ys t e m , and t hese trends are
e x pected to continue. M oreover, a lthough women continue to account for t h e
majority of workers i n m any h ealth care occupations, t heir career opportunities h ave
widened over time. And, am ong women who al ready are licensed R Ns, m any a re
ex pected to retire i n t he not-too-distant f uture while others have chosen to work in
Thus, h ealth care p roviders who p revi ously might have thought their s upply of
labor was fairly well assured m ust now compete for the i nterest o f s tudents b ased on
nursing’s attractivenes s vis-a-vis other o ccupations. They also could b ecome more
concerned about retaining t heir aging R N workforce and about appealing t o licensed
RNs who are o therwise employed. During t he mid-1990s, however, earnings growth
am ong R N s s l o wed com pared t o earl i er i n t he decade, and t hei r wage i n creases were
smaller t han t hose o f all professional workers. This could p artly ex plain t he drop in
nursing program graduates t hat b egan in the 1995-1996 academic year and t he greater
share o f R Ns not employed in nursing in 2000 as compared to 1992 and 1996.
Trends such as these underlie t h e s upply and demand projections for R Ns
releas ed by the U.S. Health Resources and S ervices Administration (HRSA). While
the agency’s o wn 199 6 p rojections and t hose o f analysts b ased in part on them
strongly suggested the likelihood of a s hortage of RNs beginning in 2007 or shortly
thereafter, HRSA’s J u ly 2002 projections push forward the overall RN shortage to
2000. If current trends continue and ameliorative actions ar e not taken, HRSA
proj ect s t hat t he aggregat e s hort fal l coul d w orsen at an accel erat i n g rat e — from 6 %
in 2000 to 12% by 2010; then rising to 20% by 2015; and climbing t o 29% by 2020.
Not all states currently are s hari n g i n the R N s hortage, nor are t hose with
short ages s hari ng equal l y, accordi n g t o HR S A’s l at est p roj ect i ons. T hi rt y s t at es were
estimated t o h ave a s hortfall o f full-time eq u i v a lent (FTE) RNs i n 2000, and t he
s e v e r ity of shortages v aried widel y — from under 4 % i n Iowa, Minnesota, a n d
Oregon to at least 13% in A r i z ona, New J ersey, and Tennessee. By 2005, perhaps
seven s t at es (Al abam a, Fl ori d a, Id aho, Maryl and, Nort h D akot a, Ok l a h o m a, and
W yoming) could ex p erience a s horta ge a s well. Another t hree states by 2010
( Illinois, Michigan, and South C arolina) and s even more by 2015 (Louisi a n a ,
Minnesota, M ontana, North C arolina, Sout h Dakota, W est Virginia, and W i sconsin)
could have an i nadequate supply. If Mississippi moves i nto a shortage situation by
Io wa, Kansas, Kentucky, Ohio, and Vermont).
W h o Are W e Talking About? ........................................2
Trends in theRNLaborMarket .......................................3
TheExperienced Unemployment Rate .............................4
Employment Growth ...........................................7
Projected Demand forRNs ..........................................8
Projected Supply o f R Ns ...........................................11
The Trend in Nursing Graduates and Enrollments ...................11
The Total Supply o f R Ns .......................................12
AShortageofRegistered Nurses? ....................................13
Table 1 . The Unemployment Rate, M edian W eekly Earnings , and
Employment of RNs and of All P rofessionals, 1989-2001 ..............6
Table 2 . P rojected Employment of RNs i n Hospitals and Across All
Industries, Selected Years ......................................10
Table 3 . P rojected Suppl y o f R Ns, S elected Years .......................13
Table4. Projected ShortagesofRNs,Selected Years ....................14
A Shortage of Registered Nurses:
Is It on the H orizon or Already Here?
Shortages o f workers in various occupations (e.g., computer systems analysts)
and i n v arious industries (e.g. , construction) were reported a few years b efore a
recession began i n M arch 2001. It is not un u s u a l f or employers t o h ave d ifficulty
hiring and retaining empl oyees after t he economy h as been ex panding for quite some
time, and the n ation ex p erienced the l ongest p eriod without a recession in U.S.
history from M arch 1991 to March 2001. W h at makes t he current situation d ifferent,
however, i s t hat t he unemploym ent rate at t he peak of the l atest economic ex pansion
was l ower t h an at m any of t h e p ri or cycl i cal peaks, and t he rat e si nce t he recessi on
began remains low compared t o m any o ther recessions. 1
In o t h e r words, t he labor market was and continues t o b e tight by historical
standards i n certain occupations and i ndustries. Fo r ex ample, t he unemploym ent rate
in 2001 among workers who h a d b e e n e m ployed as regi stered nurses (RNs) was
1.0%, compared t o t he average for all p rofessional workers of 2.2%. 2 Perhaps not
surprisingly, t hen, reports have continued t o appear about hospitals and nursing
homes in various areas of the country having di fficulty hiring enough R Ns to fill their
numerous vacant positions.
There t hus appear t o be fact ors unrel at ed t o t h e busi n ess cycl e t h at are affect i n g
the l abor markets o f certain industries and occupations. The increasing l ongevity of
the population combined with a growing share o f elderly persons have been putting
added pressure on the nation’s health care delivery s ys tem. 3 And, the implications
of inadequate staffing among health care workers differ from t hose o f o ther workers
in many industries. Fo r ex ample, a dearth of blue-collar assemblers and fabricators
might mean that consumers h ave fewer cars t o choose from while a s carcity of health
1 In March 2001, the unemployment r ate was 4.3%. T he unemployment r ate a t f ive of t he
prior nine post-war peaks i n t he business c yc le was higher: 5.4% (J uly 1990), 7.2% (J uly
1981), 6.3% (J anuary 1980), 4.8% (November 1973), 3.5% (December 1969), 5.2% (April
1960), 4.1% (August 1957), 2.6% (J uly 1953), a nd 3.8% (November 1948). Since the 2001
recession began, the highest unemployment r ate attained thus far has been 6.0%. In contrast,
the highest unemployment r ates of the pri or recessions we re: 6.8% (1990-1991 recession),
2 U . S . Bureau of Labor Statistics. Unpublished data from t he Current Population Surve y
(CPS) . ( Hereafter cited as BLS, unpublished CPS data .)
3 Wunderlich, Gooloo, with Frank A. Sloan and Carolyne K . Davis (eds.). Nursing Staff i n
Hos p i t a l s and Nur s i ng Home s . Washington, D.C., National Academy Press, 1996.
care p ersonnel migh t jeopardiz e t he quality of patients’ care.4 Moreover, although
women continue to account for t he majority of staff i n m any h ealth care j obs,5 thei r
career opportunities h ave widened over t he years. Thus, h ealth care p roviders who
previously might have thought their s upply o f l abor was fairly well assured m ust now
compete with other fields for the i nterest o f s tudents.
The l argest traditionally female-dominat ed health care occupation i s registered
nurses (RNs). It h as been asserted that there i s an ongoin g n a t i o n w i d e s hortage of
RNs of various kinds (ranging from new nursing program graduates t o already
em ployed RNs with general s kills, t o nurses with ex perience working i n hospi t al
specialty care units) and in various sectors o f t h e h e a lth care s ervices industry
(including hospitals, home health, and nursing homes). Before the l atest (mid-2002)
release o f s upply-demand projections fro m t he U.S. Health Resources and S ervices
Administrat i o n (HRSA), it was estimated, based i n whole o r p art o n 1996 HRSA
projections, t hat t here would likely b e a s hortage of RNs i n 2007 or shortly thereafter.
Thi s report fi rst wi l l anal yz e recent t rends i n t h e R N l abor m arket and t hen ex am i n e
HRSA’s new p rojections, which move d u p t he date of an RN shortage to 2000.
W ho Are W e Talking About?
The ex act nature of RNs’ daily duties usually depends on the s etting i n which
they work. 6
! In hospitals, s taff RNs t ypical l y “provide bedside nursing care and
carry out medical regimens.” They often s upervise licensed practical
nurses (LP Ns) and aides.
! Nurses who work i n physi ci ans’ offices usually prepare p atients for
ex ams a n d help doctors perform them, give i njections, apply
dressings and sometimes keep the offices ’ records.
! Nursing home R Ns largel y p erform ad ministrative and supervisory
functions. They also m ay evaluate the h ealth of residents and work
up treatment plans as well as “perform difficult procedures.”
! Home health nurses p rovide services in the homes of patients. They
often work i ndependently but also supervise home h ealth aides.
! Governm ent and p ri vat e agenci es, s chool s, seni or citizen cent e rs and
other community-based organiz ations employ public health nurses.
4 J oint Commi ssion on Accreditation of Healthcare Organizations. Health Care at the
Crossroads: Strategies f or Addressing the Evolving N u r s i n g Crisis. August 2002.
Avai l a bl e a t [ ht t p : / / www.j caho.or g] .
5 In 2001, wome n accounted f o r 94.3% of licensed practical nurses; 93.1% of regi stered
nurses; and 90.1% of nursing aides, order lies a nd attendants. U.S. Bureau of Labor
St atistics. Employment and Earnings , J anuary 2002.
6 All i nformation i n t his secti o n i s d rawn from U.S. Bureau of Labor Statistics.
Occupational Outlook Handbook 2002-03 Edition , unless otherwise noted. Available at
[http://stats.bls.gov/ oco/pdf/ocos083.pdf]. (Hereafter cited as BLS, Occupational Outlook
They provide instruction about such things as disease p revention and
nutrition as wel l as arrange for various health screenings .
! Occupational health or industrial nurses work at firms that engage
them to provide limited m edi cal care. In addition t o providing
emergency assis t a n c e and writing u p accident reports, t hese RNs
offer h ealth counseling, help with injections, and assess work
envi ronm ent s for pot ent i al h eal t h / s afet y p robl em s.
! Head nurses o r nurse supervisors p erform such ad ministrative a n d
supervisory functions as creating w ork s chedules for and assign ing
duties t o nurses and aides, “provid[ ing] or arrang[ i ng] for training,
and visit[ing] patients t o observe nurses and to ensur e t h e p r oper
del i v ery o f care.”
! Nurse p ractitioners provide primary health care (i.e. , p rescribe
medication and otherwise diagnose and treat common acute illnesses
and i njuries). Other advanced prac tice nurses i nclude clinical nurse
speci alists, certified registered nurse anesthetists, and certified nurse-
midwives. They al l m ust fulfill higher education a l a n d clinical
ex perience requirements t han t hose established for the
A b asi c nursi ng educat i o n i n al l st at es consists of graduation from a nursing
program and passing a n ational licensing ex am . Hospitals offer diploma programs,
which t ake 2 -3 years t o complete. Although 60% of RNs i n 198 0 g raduated from
di pl om a p rogram s, t h e s h a r e who recei ved t hei r basi c nursi ng educat i o n from t hi s
source was h alved, to 30%, b y 2000.7 C o m m uni t y col l eges o ffer associ at e d egrees
in nursing (ADNs), which t ake about 2 years t o complete. In 2000, they accounted
for 40% of regi stered nurses — about twice t heir share of 19% in 1980. Colleges and
universities o ffer b ach el ors d egrees in n u r s i ng (BSNs), which take 4 o r 5 years t o
complete. The share of R Ns who i nitially earned BSNs also rose considerably, from
17% in 1980 to 29% in 2000. In addition t o classroom instruction, nursing students
m u st have supervi s ed cl i n i cal ex peri en ce in hospitals, nursing homes, home health
agenci es or other health care facilities.
Trends in the R N Labor Market
No direct measure o f o ccupational l abor s hortage ex ists. Analysts t herefore use
a v ariety of indicators t o assess supply-demand conditions. The unemploym ent rate
i s perhaps t he “best-known ex ample of such an indicator,” but relying o n j us t o n e
indicator “can still lead to an incorrect c onclusion” about t h e ex i stence of a l abor
shortage. 8 Other o ften used indicators t hat t he government has regularly co l l e c t ed
7 U.S. Department of Health and Human Services. Health Resources a n d S ervi ces
Admi nistration. Th e R e g i s tered Nurse Population: Findings from the National Sample
Survey of Registered Nurses — M arch 2000. J u l y 2002. Available a t [ http://www.bhpr.
hrsa.gov/healthworkforce/reports/rnsurve y/ default.htm] . ( Hereafter c i t e d a s HRSA, The
Registered Nurse Population.)
8 Cohen, Malcolm S. Labor Shortages as America Approaches t he T w e n t y -first Century .
an d t h a t have used consistent definitions over time incl ude earnings and
The Exper i enced Unempl oyment Rate
As shown i n Table 1, t he share o f ex p erienced RNs without jobs has b een very
low for quite some time and has remained below t he rate for professional workers in
general, the l arger occupational group in which R Ns are classified. In t he late stages
of the economic ex pansion, however, t he unemploym ent rate o f R Ns dropped t o
levels last seen in the 1989-1992 period — when t he r e l a s t w a s concern about a
At that time, t he situation
prompted passage of the Nursing Shorta ge Reduction a nd Education Extension
Act a nd implementation of t he Immi gr ation Nursing Relief Act of 1989. Soon
after r eports of shortages, h owever, the overall economic picture began to
change. T he hospital i ndustry r esponded by i ncreasing overtime work, retention
and r ecruitment efforts, and nursing wages [ as well as restructu r i n g w o r k t o
utilize nursing aides and licensed practi c a l n u r ses, among others, i n lieu of10
These m easures succeeded in increasing t he supply of R Ns by, among other t hings,
enticing m ore s tudents t o enter the field. The numb e r o f graduates from nursing
degree programs climbed sharply — by 57.4% or 35,392 graduates — from t he 1989-
1990 academic year to the 1994-1995 academic year.11 In addition, the s hare of RNs
who m aintained t heir licenses but were not employed in nursing dropped from 20.0%
Ann Arbor, M I, University of Michigan Press, 1995. p. 25.
9 T he government does not have a data s eries on occupational vacancies, a nd like t he other
indicators, vacancies in themselves are an i nsufficient measure of l abor shortage. An
occupation c ould have both a high unemployment r ate ( which s ugge sts e xcess s upply) and
a h igh vacancy rate (which suggests excess demand) if employers and workers f ind i t
difficult to make matches due to the different locations of j ob openings and of workers. T he
s a me s i t uation also could i ndicate a skill mi smatch rather than a shortage per s e if, fo r
example, hospitals want to fill vacancies with RNs having experience in specialty care units
rather than with new RN gra d u a t e s . A high vacancy rate would be more suggestive of a
supply problem if employers could not fill openings quickly, but surveys do not appear to
always ask about the du r a tion of openings. A high vacancy rate also would be more
suggestive of a shortage if information were provi ded s howing t hat t he unfilled j obs offered
salaries that were sufficiently competitive t o attract any a va i l a b l e workers (e.g., licensed
RNs e mploye d i n other occupations). In addition, as the U.S. General Accounting Office
( Nursing Workforce: Eme r ging Nurse Shortages Due to Multiple Factors , GAO-01-944,
J uly 2001) noted, one should be cautious when comparing different studies’ vacancy rates
because they may not all calculate rates i n t he same way.
10 V eneri, Carolyn M. Can Occupational Labor Market Sho r t a ge s be Identified Using
Available Data? Monthly Labor Review, M arch 1999. p. 17 and 20.
11 HRSA. United States Health Workforce Personnel Factbook. ( Hereafter cited as HRSA,
United States Health Workforce Personnel Factbook.)
i n 1988 to 17.3% in 1992 and remained at t hat l evel in 1996, which s ugges t s t h a t
these m easures prompted some RNs t o return t o t he occupation. 12 Consequently,
reports of a nursing shortage petered out early in the 1990s.
Unlike t he earlier episode of a s eeming s hort age, h eal t h care p rovi ders al ready
have increas ed thei r use of overtime to the point where i t has drawn t he ire of m any
RNs and thei r representatives . S ome s tates have i ntroduced or passed l egislation t o
curb i t s use. 13 In addition, the change i n economic conditi o n s b e t w e e n 2000 and
despite the advent of the l atest recession i n March 2001, the ex p erienced
unemploym ent rate among RNs remained v irtually unchanged from its 2000 level.
However, em pl oyers s eem i n gl y h ave not rai s ed R N earni ngs i n t he l ast few years t o
the s ame ex t ent t hey d id during t he late 1980s/early 1990s (see below).
Between 1989 and 1993, full-time RNs’ median weekly wages i ncreased more
than those o f all professional employees (20.7% and 16.0%, respectively, as shown
in Table 1). HRSA estimated t hat full-time RNs i ncreased their average annual
earnings t o an even greater degree, namely, b y one-third (from $28,383 in 1988 to
$37,738 in 1992).14
The p attern reversed through 1997, as can be seen in the BLS data contained i n
Table 1. HRSA’s d ata also reveal a s lowdown i n R N average earnings g r o w t h, to
11.5%, b etween 1992 ($37,738) and 1996 ($42,071). T he reversal has b een partly
ascri b ed t o t h e d evel opm ent and spread of m anaged care (an a r r a n g e m ent u sed t o
cont rol t he use, and h ence, t h e cost o f h ea lth services provided t o enrollees in many15
12 HRSA. Preliminary Findings from the Nati onal Sample Survey of Registered Nurses —
March 2000. February 2001.
13 Ur ban Institute. Skill Shortages and Mismatches in Nursing R e l a t e d Health Care
Employment . Prepared f or the U.S. Department of Labor. April 2002.
14 HRSA, The Registered Nurse Population. Not e : T he size of reported wage i ncreases can
vary gr eatly depen d i n g o n s uch things as the definition of t he occupation, how well the
sample reflects t he population from which it was drawn, t he relative s ize of t he sample, and
the r ate of r esponse t o t he survey. In t he case of t he BLS a nd HRSA wage data, t he former
calculates a median and t he latter, a mean wage , w h i c h c a n b e pulled up by a few l arge
observations. Because BLS clas sifies workers according t o t heir principal activity, such
comparatively high-paid RNs as administrators and managers are omitted from t he BLS’ RN
wage calcu l a t i o n . T hey are captured i n HRSA’ s database which includes all indivi duals
15 Buerhaus, Peter I., and Douglas O. Staiger. T rouble i n t he Nurse Labor Market? Recent
T r ends and Future Outlook. Health Affairs, J anuary/February 1999, v. 18, no. 1. (Hereafter
cited as Buerhaus and Staige r , Trouble i n t he Nurse Labor Market?); and Schumacher,
Edward J . T he Earnings a nd Employme nt of Nurses in an Era o f C o s t C o ntainme nt.
I n dustrial and Labor Relations Review, October 2001, v. 55. no. 1. (Hereafter c ite d a s
Schumacher, The Earnings and Employment of Nurses .)
Table 1. The Unemployment Rate, M edian W eekly Earnings,
and Employm ent o f RNs and o f All Professionals, 1989-2001
Experienced a Median w eeklyb Total employment
unemployment r ate earnings ( i n t housands)
RNs prof es- RNs prof es- RNs prof es-
sionals sionals sionals
1989 1.3 1.7 569 586 1,599 15,550
1990 1.1 2.0 608 610 1,667 15,800
1991 1.2 2.4 635 633 1,704 16,030
1992 1.1 2.6 662 658 1,799 16,370
1993 1.3 2.6 687 680 1,855 16,893
1994 1.5 2.5 682 705 1,956 17,536
1995 1.5 2.5 695 718 1,977 18,132
1996 1.4 2.3 697 730 1,986 18,752
1997 1.5 2.1 710 750 2,065 19,245
1998 1.3 1.9 739 763 2,032 19,883
1999 1.1 1.9 750 800 2,128 20,883
2000 1.0 1.7 790 832 2,111 21,113
2001 1.2 2.2 829 854 2,162 21,556
Source: U.S. B ur eau o f La b o r Statistics. Employment and Earn ings, J anuary issues of various years,
a nd unp ub l i s he d d a t a fr o m t he Cur r e nt P o p ul a t i o n S ur ve y.
a T he exp erienced unemp loyment r ate covers p erso ns who had j obs as RNs immediately b efore their
sp ell o f une mp loyment ( i.e., it e xc ludes new entrants and r e-entrants to the RN labor fo rce). T he
employment and unemp loyment r ate series cover all emp loyed p erso ns.b
Median weekly earnings cover wage and salary wo rkers emp loyed full-time.
The relatively s lower wage growth among RNs i n t he mid-1990s could p artly
ex plain t he drop in graduations from nursi ng degree programs that began i n t he 1995-16
19 9 6 academ i c year. It also could account for t he increased share o f R Ns not
employed in nursing: R Ns who were n o t e m ployed in nursing rose from 17.3% in17
The m edian weekly earnings o f R Ns since 1997 have been rising more rapidly
compared to those o f all professionals (16.8 % a n d 1 3 .9%, respectively), and
16 HRSA, United States Health Workforce Personnel Factbook.
17 HRSA, National Sample Survey of Registered Nurses .
compared to their o wn rate of increase during t he 1993-1997 period (3.3%). Unlike
the BLS wage series shown i n Table 1, HRSA’s data do not show a similar
acceleration i n wage growth from t he mid-1990s: t he average annual p ay of full-time
RNs i ncreased by 11.2% between 1996 ( $42,071) and 2000 ($46,782), o r b y v irtually
the s ame rate (11.5%) as b etween 1992 and 1996.
Bot h wage seri es show a s m al l er earni ngs i ncrease i n recent years com pared t o
the l as t time thei r was a tight labor market for R Ns. As s hown i n Table 1, employers
r a i s e d R N s ’ wages i n t he 1997-2001 period (16.8%) b y l ess t han t hey d id in th e
1989-1993 period (20.7%). Similarly, HRSA’s su r v eys p rovide estimates of
relatively s maller earni n g s g r o w t h b etween 1996 and 2000 (11.2%) t han b etween
1988 and 1992 (32.9%). However, some assert that as a res ult of t he introduction
a n d s pread of cost containment m easures in the h ealth care i ndustry, providers a r e
less financially able today t han t hey were i n t he past to deal with a l abor shortage by
raising t he wages o f R Ns or by hiring more RNs d irec tly or through t emporary
agenci es. 18
The efficacy of high er wages at i ncreasing t he supply o f already employed R Ns
relative t o d emand, as measured by their number o f work hours, is open t o question.
Accordi n g t o a survey t h at was adm i n i s t ered t o nurses w ho becam e l i censed i n N ew
York St at e i n 1999, 40% said they would be willing t o work m ore hours i f o ffered
a h i gher s al ary. Anot her 44% i ndi cat ed t h at t h ere w ere fact ors o t h er t h a n h i gh er
salaries that would m otivate t hem t o put i n l o n ger hours (i.e., flex i ble hours,
speciality of choice, different shift o r hours and other conditions), while 16.0% stated
that t h ey w o u l d n o t be willing t o do s o under any conditions.19 The objection o f
nurse advocat es to hospitals’ current use of m andatory overtime to cope with a dearth
of staff m ay reflect the unwillingn es s o f arguably overburdened R Ns to work more
hours o r t o continue in nursing under t he present s tate of working conditions, i n p art
because fatigue might compromise t he quality of care b eing rendered.20
Empl oyment Gr ow th
Between 1989 and 1994, job growth among RNs o ccurred m uch m ore rapidly
than across all professionals (22.3% and 12.8%, respectively; see Table 1). Bet w een
18 J acklevi c, Mary Chris and Ed Lovern. A Nursing C o d e Bl u e . Modern Healthcare,
December 11, 2000.
19 S a l s berg, Edward S. State Nursing Shortage Issues: New Y ork . Presentation at
conference, Hard Numbers, Hard Choices: A Report on t he Nation’s Nursing Workforce,
held February 14, 2001 in Washington, D.C.
20 See, for example: Aiken, Linda H., with Sean P. Cl arke, Douglas M. Sloane , J ulie A.
Sochalski, Reinhard Busse, Heather Clark, Phyllis Gi ovannetti, J ennifer Hunt, Anne Marie
Rafferty and J udith Shamian. Nurses’ Reports on Hospital Care i n Five Countries. Health
Affairs, M ay/J une 2001; American Nurses Association. Nurses Concerned Over Working
Conditions, Decline in Quality of Care, ANA Survey Reveals. Press Release, February 6,
and Federation of Nurses and Health Professionals. The Nurse Shortage: Perspectives from
Current Di rect Care Nurses and Former Di rect Care Nurses . April 2001.
1995 and 2001, however, relative e m p l o ym ent growth among RNs (9.4%) l agged
employment growth among all p rofessionals (18.9%).
The s l o wdown i n R N j ob growt h i n t h e l ast s everal years appears t o b e at l east
partly related t o t he spread of managed care across t he nation.21 The diminished rat e
of growth has b een concentrated in hospitals, although t here are i ndications that the
RN job creation rate i n t he home health industry h as decreased as well. “Medicare’s
implementation o f a prospective p ayment system for t he home h ealth care i ndustry
... place[ s] new economic pressure on providers and reinforces the s lowing effect of
m anaged care. 22
The n at ure o f t he demand for R Ns by work setting and by geographic area also
coul d h ave t em pe r e d t h e occupat i on’s aggregat e rat e o f em p l o ym ent growt h.
Accounts o f an undersup p l y o f R Ns often h av e related to particular settings (e.g.,
hospital emergency rooms) and t o p articul ar parts o f t he country. In addition, certain
health care facilities (e.g., nursing homes ) m ay be ex perienci ng more difficulty than
others in attracting adequate staff i n part r es u l t i ng from differences in the s al aries
offered t o R Ns. 23 The l a b o r m a r k et indicators j ust d iscussed d o not conclusively
support t he ex istence o f an across-the-board shortage of RNs i n t he past few years;
however, national dat a are not suffici ently sensitive t o i dentify a maldistribution of
R Ns across geographi c areas and b y k i nds of R Ns and heal t h care workpl aces (e.g.,
new nursing school graduates v ersus nurses with ex perience in hospital emergency
rooms o r n eonatal care units) as opposed to a s hortage of labor per s e.
Projected Demand for RNs
The d em and for l abor can i n crease for t wo rea s o n s . W h en consum ers want
more of an industry’s goods or services, firms may add employees to their p ayrolls.
This is the j ob creation discussed immediat el y bel ow. Hiring also m ay increase i f a
fi rm ’s em pl oyees l eave t o t ake posi t i ons at other employers, o r ex i t t he labor force
to return to school, o r due to retirement, disability or death. “Replacement n eeds,”
discussed s hortly, m ay increase t he demand for l abor well beyond that induced by
Futur e RN J ob Gr ow th
Hospitals are likel y t o continue to em ploy the m aj ority of RNs i n future years,
a l beit a d ecreasing s hare. As HRSA reported i n 2002, the number o f full - time
equivalent (FTE) RNs estimated t o h av e worked i n hospitals in 2000 was 1,242,831;
21 Schumacher, The Earnings and Employment of Nurses .
22 Buerhaus and Staiger, Trouble i n t he Nurse Labor Market? p. 221.
23 For more i nformation see: American Health Care Association. Staffing of Nursing
Services in Long Term Care: Present Issues and Prospects f or the Future . February 2001.
t h e p r ojection for 2010 is 1,451,083.24 According t o t he BLS, the number o f R N s
employed part-time and full-time in hospitals in 2000 was 1,274,031; the projection
for 2010 is 1,465,831.25 (S ee Table 2.)
RN employment in hospitals is projected to grow slowly (between 15.0% and
16.8%) compared t o R N employm ent i n other settings b ecau s e activities once
per f o r m e d o n an inpatient basis i ncreasin gl y are being p erformed on an outpatient
basi s, ei t h er i n hospi t al s or el sewhere, and b ecause pat i ent s are bei n g d i s charged
earlier. Despite the assumption t hat t he number of i npatients will not grow much,
“ t h e i n tensity of nursing care i s likely t o i ncrease, requiring more nurses p e r26
The ranks of RNs already employed i n l arge numbers at other work s ettings are
ex pect ed t o ex pand subst ant i al l y. T hi s appears t o b e p art i cul arl y t h e c ase for R Ns
em pl oyed i n workpl aces t h at l argel y s erve t h e el d erl y. For ex am pl e, em pl oym ent of
nurses i n t he home h ealth sector is projected to increase b y 36.3% between 2000 and
2010 , f rom 130,288 to 177,583 FTEs. S imilarly, RNs employed at nursing homes
are p rojected to increase b y 32.4%, from 168,529 to 223,193 FTEs.27 The p reference
of people t o b e cared for i n t h e i r h o mes, new t echnologies t hat p ermit complex
treatments t o b e p erformed at hom e , t h e “ growing number o f o lder persons with
funct i o n a l disabilities, ... many of whom will require long-term care,” and “t he
financial p ressure on hospitals to [ q uick ly] discharge patients” who m ay require
further care i n nursing homes or other t reatment facilities contribute t o t hese
disparat e project ed trends in RN em ployment by work setting.28
Across the entire h ealth care i ndustry, the rate o f employm ent growth b etween
2000 and 2010 that BLS projects among RNs (25.6%) is even greater than t h at of
HRSA (17.2%). (See Table 2.) Demand for R Ns through 2010 could b e above the
average across all occupations (15.2%), and nursing is among the occupations
ex pect ed to add t he most new j obs over t he 10-year period (561,000 part-time and
24 HRSA. Pro j e c ted Supply, Demand, and Shortages of Registered Nurses: 2000-2020 .
J u l y 2002. Avai l a ble at [http:// www.bhpr.hrs a . g o v / h e a l t h w o r k f o r c e / r n p r o j e c t / d e f a u l t . h t m] .
(Hereafter cited as HRSA, Projected Supply, Demand, and Shortages of Registered Nurses .)
25 BLS. Industry-Occupation Employmen t M a t r i x . (Hereafter cited as BLS, Industry-
Occupation Employment M atrix.) Not e : In a ddition t o t he obvious difference t hat HRSA’ s
figures a re expressed a s FT Es while BLS’ a r e a c ount of persons employed rega rdless of
part-t i me/full-time status, the t wo differ i n other respects i ncluding: BLS categorizes
indivi duals by their principal work activity rather than by credential as does HRSA s o, for
example, BLS classifies RNs who largely t each or manage in n on-nursing occupations;
HRSA’s base-year employme nt is derive d from a survey of licensed nurses while BLS’
base-year employment is derived from a s u r vey of employers; and t hey utilize different
proj ection methodologies.
26 BLS, Occupational Outlook Handbook .
27 HRSA, Projected Supply, Demand, and Shortages of Registered Nurses.
28 BLS, Occupational Outlook Handbook .
full-time workers).29 An aging population t hat i s m ore likely t o n eed medical care,
a popula t i o n t h a t also i s wealthier and therefore can afford better care, and
technological advances that allow m o r e m edical problems t o b e t reated more
aggressively underlie the considerable increase i n d emand for RNs anticipated in the
nex t several years.
Table 2. Projected Employment of RNs in Hospitals
and Across All Industries, Selected Years
Em pl oyment ( f ull-time Em pl oyment ( part-time
equivalents) and f ull-time w orkers)
Re gistered nurses by Num b e r P ercent Num b e r P ercent
i ndust r y change change
2010 1,451,083 16.8 1,465,831 15.0
2010 2,344,584 17.2 2,755,325 25.6
Source: Full-time e q uivalent e mp lo yment figur es fr o m HRSA, Projected Supply, Demand, and
Shortages o f Registered Nurses: 2000-2020. P ar t-time a nd full-time e mp lo yment figur es fr o m B LS,
Industry-Occupatio n Emp lo yment Matrix.
No te: HRSA class i fies all p erso ns with RN license s a s r egistered nur se s while B LS c lassifies
individuals b y their principal work activity so , for example, BLS does not includ e tho se RNs who
largely work as teachers and managers in its count of nur ses.
a In March 2000, according to HRSA’s Fin d i n g s f r o m th e National Sample Survey of Registered
Nu rse s , the number o f RNs employed part-time and full-time in hospitals was 1 ,300,323. So me
28.2% (or 366,962) wo rked part-time.b
In March 2000, according to HRSA’s Finding s f ro m t he Na tional Sample Survey of Registered
Nu rse s , the to tal number o f RNs employe d part-time and full-time in nursing was 2 ,201,813.
Approximately 28.4% (or 625,139) wo rked part-time.
Futur e RN J ob Openi ngs
The n eed to replace workers across all industries will acce l e r a t e as more
members o f t he baby-boom generation (the l arge group born b etween 1946 and 1964)
retire. H e a l t h c a re p roviders generally, and hospitals particularly (as t he larges t
29 Hecker, Daniel. Occupational Employment Proj ections to 2010. Monthly Labor Review,
Nove mber 2001. (Hereafter c ited a s Hecker, Occupational Employ ment Projections .)
employer of RNs), could be among the i ndustries m ost affected by this demographic
phenomenon because the p roportion o f nurses at l east 4 5 years o ld is greater than the
average p roportion across all occupations. 30 The average a g e o f R Ns employed in
nursing in 2000 was 43.3 years, with 45.5% age 4 5 and older.31
Of the one million t otal job o p e n i n g s p rojected for R Ns through 2010, 44%
could arise through t he need to replace wo rkers who ex it the o ccupation rather t han
through employm ent growth.32 Not all job openings are created by individuals who
l eave an o ccupat i o n for ret i rem ent , however . R Ns, for ex am pl e, m o st frequent l y
indicated in a HR S A s urvey t hat t hey wer e employed i n o ccupations other t han
nursing because the positions provided m ore convenient hours (45.7%), were more
rewarding p rofessionally (44.9%), or currently offered b etter s alaries (35.4%).33
Projected Supply of RNs
It usually is more difficult to estimate occupational l abor supply t han d emand.
The s upply o f n ew workers t o nursing can be estimated m ore easily than the s upply
to many other occupations where college major i s l es s det erminative of t he fiel d i nto
which t he student will go o r where n o formal education or t raining beyond high
school typically is required. By focusing just on graduations from p rograms t hat
offer nursing degrees, t he supply o f n ew RNs could well b e understated b ecause the
availability of nurses from a b road — who can enter t he country permanently or as34
temporary w orkers — would be omitted. In order t o devel op the bes t possible
estimate of the p rospective t otal supply o f l abor to RN jobs, “leavers” (i.e., RNs who
take jobs in other o ccupations or who ex it t he labor force for such reason s as
retirement o r d isability) also m ust b e t aken into account.
In addition t o t he previously described d emand p rojections released in 2002,
HRSA d eveloped n ew supply p rojections. They are the b asis for m uch o f t he
The Tr end i n Nur si ng Gr aduates a nd Enr ol l m ents
The number o f graduates from p rograms t hat p repare students for RN licensure
(i .e., di pl om a, associ at e and baccal aureat e) has w ax ed and w aned i n recent d ecades.
30 Dohm, Arlene. Gaugin g t h e L a b o r Force Effects of Retiring Baby-Boomers. Monthly
Labor Review, J uly 2000.
31 HRSA, The Registered Nurse Population.
32 Hecker, Occupational Employ ment Projections .
33 HRSA, The Registered Nurse Population.
34 Foreign nurse gr aduates can enter t he country on a permanent basis either as relatives of
U.S. citizens or l egal permanent r esidents, or as employment-based i mmi gr ants. T hey also
can enter as t emporary workers by obtai ning an H-1C vi sa (CRS Report RS20164,
Immigration: Temporary Admission of Nurses f or Hea lth Shortage Areas (P.L. 106-95),by
J oyce V ialet) or an H-1B vi sa if they have a bachelor’s degr ee, or if they are from M exico
or Canada, by a pplyi ng for T rade NAFT A (North American Free T r ade Agr eement) status.
Between 1995 and 2000, the number of new RN graduates (based on i ndividuals
passing the licensing test) d ropped b y 26.0%, from 96,610 to 71,475.35
The recent t rend in enrollments — down over t he past 5 years — does not bode
well for t he supply o f n ew entrants to the R N workforce in the s h o r t - r u n.
Baccalaureate enrollment did i ncrease b etween 2000 and 2001; however, i t t akes
longer for t hese students t o become licensed R Ns compared to those i n diploma and
associate d egree p rograms. If BS N graduates continue to account for a growing s hare
of al l nursing graduates, thei r l engt hier preparation time effectivel y could dam pen
growth in the s upply of R Ns.36
The Total Suppl y of RNs
HRSA projected the s upply o f graduates fro m b asic nursing education p rograms
by taking into account such fact o rs as j ob availability and t he attractiveness o f
nursing as a career, both o f which would lik ely i nfluence students’ decisions about
their choice of occupations in the future. Other v ariables included were t he female
population of nursing students by age and t he share o f female h igh s chool graduates
enrolling in college. In addition, estimates of leavers were derived by taking into
consideration s uch t hi n g s a s d eaths among white women and nurses who fail to
renew t heir licenses. Then, t o estimate the t otal supply o f R Ns, “activity rates” were
developed b ased on the p roportion o f R Ns by age g r o u p t h a t was employed i n
nurs i n g i n March 2000, according t o t he National Sample of Registered N urses.
Fi nally, t he count of individuals was t ransformed into FTEs based o n d ata from t he
same source about the p attern of full-time and p art-time employment and t he number
of scheduled hours p er nurse.
As shown i n Table 3, t he total s upply o f FTE R N s i s p r o jected to increase
between 2000 and 2011. The rate o f growth i s ex p ected to fall off during t his p eriod,
with the d ecline p articularly steep after 2 005, when an especially large number o f
baby-boom RNs will start reaching 5 5 years o f age — an age “ a t w h i c h R Ns have37
historically begu n t o reduce t heir labor participation.” The 3.6% projected decrease
in the s upply of R Ns from its peak in 2011 to 2020 might bring t he total below its
35 HRSA, Projected Supply, Demand, and Shortages of Registered Nurses.
37 Minnick, Ann F. Retirement, the Nursing Workforce, and the Year 2005. Nursing
Outlook , September/October 2000. p. 211.
Table 3. Projected Supply o f RNs, Selected Years
Suppl y ( i n f ul l - t i m e
Year equivalents) Number P ercent
2005 2,012,444 123,201 6.5
2011 2,075,891 63,447 3.1
2020 2,001,998 -73,893 -3.6
Source: HRSA, Projected Supply, Demand, and Shortages o f Registered Nurses: 2000-2020 .
A S hortage of Registered Nurses?
As discussed b elow in more detail, the l atest p rojections from HRSA o f s upply
and dem and conditions in the l abor market for R Ns pushed fo r ward the time of a
shortage t o 2 0 00.38 The 1996 supply-demand projections of HRSA had s hown a
national s hortage in 2007. And, an alternative p rojection o f t he supply o f R Ns, when
compared with HRSA’s 1996 demand proj ection, revealed a s hortage emergi ng39
Not al l st at es are s hari ng i n t h e p resent -day shortage of RNs, as determined by
HRSA’s l a t e s t es timates, nor are t hose with shortages s haring equally. If current
trends continue, and no mitigatin g act i ons are t aken, t he number of states
ex periencing shortages i s p rojected to increase and leave j ust a few without an RN
Nati onal P r oj ecti ons
As shown i n Table 4, nationwide dem and for RNs was estimated t o have
ex ceeded supply i n 2000. Th e 5.5% shortfall is projected to worsen at an
accelerating rate t hrough 2020, by which time there might be 28.8% fewer FTE RNs
than demanded by employers. This s cenario assumes t hat policym akers and the
industry, among others, d o not undertake ameliorative actions during t he period. 40
38 HRSA, Projected Supply, Demand, and Shortages of Registered Nurses.
39 Buerhaus, Peter I. with Douglas O. Staiger and David I. Auerbach. Implications o f a n
Aging Registered Nurse Workforce. Journal of the American M edical Association , J une 14,
40 For i nforma tion on l egislative activity see: CRS Report RL31090. Long-Term Care:
Nursing and Paraprofessional Workforce I ssues , by J ulie Stone and Rachel Kelly.
Table 4. Projected Shortages o f RNs, Selected Years
Suppl y ( i n f ul l - Demand (in f ull- a b
Year time equi valents) time equi valents) Num b e r P ercent
2000 1,889,243 1,999,950 -110,707 -5.5
2001 1,912,667 2,030,971 -118,304 -5.8
2002 1,937,336 2,062,556 -125,220 -6.1
2003 1,959,192 2,095,514 -136,322 -6.5
2004 1,989,329 2,128,142 -138,813 -6.5
2005 2,012,444 2,161,831 -149,387 -6.9
2006 2,028,548 2,196,904 -168,356 -7.7
2007 2,039,772 2,232,516 -192,744 -8.6
2008 2,047,729 2,270,890 -223,161 -9.8
2009 2,059,099 2,307,236 -248,137 -10.7
2010 2,069,369 2,344,584 -275,215 -11.7
2011 2,075,891 2,379,719 -303,828 -12.8
2012 2,075,218 2,426,741 -351,523 -14.5
2013 2,068,256 2,472,072 -403,816 -16.3
2014 2,061,348 2,516,827 -455,479 -18.1
2015 2,055,491 2,562,554 -507,063 -19.8
2016 2,049,318 2,609,081 -559,763 -21.4
2017 2,041,321 2,656,886 -615,565 -23.2
2018 2,032,230 2,708,241 -676,011 -24.9
2019 2,017,100 2,758,089 -740,989 -26.9
2020 2,001,998 2,810,414 -808,416 -28.8
So urce :HRSA,Projected Supply, Demand, and Shortages o f Registered Nurses: 2000-2020 .
a T he number b y which demand exceeds supply.
b T he number b y which demand exceeds supply d ivided by demand .
The s hortage is the outcome of increasing d emand for RNs t hroughout the 20-
year projection p eriod and decreasing s uppl y dur ing its latter h alf. The estimated
d e c l ine i n R N s upply d istingu ishes t he current shortage from t he tight RN labor
market of the l ate 1980s/early 1990s, which was d emand-based. 41 Working women
recently have had a wider range of job opportunities open t o t hem and consequently,
have been less prone to choose a career in nursing. Fo r ex ample, women who
graduated from h igh s chool in the 1990s were estimated t o b e 30%-40% less likely
to ent e r t he nursing profession than those who graduated 2 0 years earlier.
C onversel y, wom en h ave s hown an i ncreased interest in traditionally mal e -dom i n at ed
occupations (e.g., doctors or dentists). 42
Because the s upply s ide o f t he equation appears t o b e l a r gely driving t he
shortage, i t m ay not be easily or quickly undone. Employers can be ex pected to try
to correct the s upply-demand imbalance by further i n c reasing nurses’ wages,
assign ing s ome duties now performed by RNs t o p araprofessional nursing personnel
an d u tilizing additional productivity-enhancing t echnology. These remedies were
used successful l y i n t h e p ast when R Ns were scarce rel at i v e t o d em and, but t h e
earlier s ituations were not marked by an aging R N l abor force with the attendant need
to replace many retiring nurses at about the s ame time older baby-boomers will make
great er demands on the nation’s health care delivery system.43 While raising rel ative
wages, improving working conditions, upgr a d i n g t he occupation’s image and
lowering education costs to promote recruitment may e n c o u r age m ore s tudents t o
become RNs, thes e changes could t ake s ome time to make them selves felt and t heir
e f f e c t s could b e d ampened b y t he altern ative career paths now open t o wo m e n .
Another m eans of bringing m ore workers into the field i s t h ro u gh immigration.
However, “eliminating t he shortage woul d require immigration o n an unprecedented
scal e,” 44 and as h appened when t he 105th and 106th Congresses i ncreased the number
of H-1B visas for professional/specialty workers, the policy could p rove to be a
State P rojections
Not al l st at es m ay now be ex peri enci ng a s hort age of R Ns, accordi n g t o HR S A’s
latest projections. The following 21 areas were projected to have a s ufficient s upply
relative t o d emand i n 2000:
41 Aike n, Linda H. T he H o s p i t a l Nursing S hortage : A Paradox of Increasing Supply a nd
Increasing V acancy Rates. The Western Journal of Medicine , J uly 1989, v. 151, no. 1.
42 Stager, Douglas O., wit h Davi d I. Auerbach and Peter I. Buerhaus. Expanding Career
Opportuni t i es for W omen and t he Declining Interest i n Nursing as a Career. Nursing
Economics , September-October 2000, v. 18, no. 5.
43 American Or ganization of Nurse Executives. Perspectives on the Nursing Shortage: A
Blueprint f or Action. October 2000. Available a t: [http://www.aone.org] .
44 Buerhaus, Staiger and Auerbach, Implications of an Aging Registered Nurse Workforce ,
p. 2953. T he authors noted in Policy Responses to an Aging Registered Nurse Workforce,
Nursing Economics , November/December 2000, v. 18, no. 6, that by 2020 the s upply of f ull-
time e quiva lent RNs c ould be 400,000 fewer t han needed to meet employer dema nd.
Al abama, Di strict of Colu mbia, Flori da, Idaho, Illinois, K ansas, K entucky,
Louisiana, Maryland, Michigan, M i s s i ssippi, Montana, North Carolina, North
Dakota, Okl ahoma, South Carolina, South Dakota, V e rmont, West V i r gi n i a,
Wisconsin, a nd Wyoming.
Thirty states likely h ad a s hortage of FTE R Ns in 2000, with shortage defined
as demand surpassing supply by at least 3% in light of “uncertainties in the
es timation process.”45 The ex t ent o f t he short fal l coul d h ave v ari ed wi d el y — from
under 4 % i n Iowa (942 FTEs), Minnesota (1,347 FTEs), and Orego n (849 FTEs), to
13% or mor e i n A r i z o n a (5,984 FTEs), New J ersey (8,392 FTEs), and Tennessee
P erhaps s even st at es (A l a b a m a, Fl o rida, Idaho, Maryland, North Dakota,
Oklahoma, and W yo ming) and t he District of Columbia could b e added i n 2005 to
those with an RN shortage in 2000. Convers ely, a f e w states (Hawaii, Io wa,
Minnesota, and Ohio) could m ove out of a s hortage situation over t he same 5-year46
After 2005, HRSA estimates t hat no s tates are likely t o m ove out of a s hortage
situation. In stead, b etween 2005 and 2010, three states (Illinois, Michigan, and South
Carolina) might join those already project ed to be ex perienci ng a s hortfal l of R Ns.
Seven s tates (Louisiana, Mi nnesota, M ontana, North C arolina, South Dakota, W est
Virginia, and W i sconsin) might be added i n 2015. Between 20 1 5 a n d 2020,
Mississippi could j oin t he ranks of states w ith too few FTE R Ns relative t o project ed
The R N s hortage is es timated t o be almost universal by 202 0, when HRSA
proje c t s i t c o u l d affect 44 states and t he District of Columbia. The severity of the
shortfal l also i s estimated t o worsen over t he 20-year projection period, ranging up
to high s o f over 40% in Alaska, C alifornia, C onnect i cut , D el aware, Georgi a, Id aho,
New J ersey, New M ex ico, Oregon, Rhode Is land, Tennessee, W ashingt on, and
Only Hawaii, Io wa , K a n sas, Kentucky, Ohio, and Vermont might have an
adequate RN supply com pared to demand in 2020, accordi n g t o H R S A’s l at est
projections. Three of these s ix states — Kansas, Kentucky, and Vermont — might
have an adequate supply o f FTE RNs t hroughout the p rojection p eriod.
45 HRSA, Projected Supply, Demand, and Shortages of Registered Nurses ,p.3. Not e :The
followi ng situations affect the accuracy of stat e-specific proj ections: “(a) a State may have
ma ny local shortage s yet overall have a n a dequa te supply; (b) a significant number of nurses
commute across State boundaries to work; ( c) j urisdictions like Washington, D.C. provide
service t o l arge populations from outside its boundaries; a n d ( d ) demand proj ection
methodology i nadequately accounts f or the differences in nursing utilization patterns t hat
may exist between States.”
46 HRSA, Projected Supply, Demand, and Shortages of Registered Nurses.