Flexibility emerges as the future of healthcare staffing models
Rising labor costs and clinician burnout are interconnected, feeding into a vicious cycle. Most executive leaders at large hospital systems in the US face two major healthcare workforce challenges:
A cost problem: Clinical labor costs are soaring due to turnover and skill-mix shortages.
An engagement problem: Overworked staff and generational challenges are diminishing workforce morale and patient care outcomes.
Let’s dig into what that means, and what is driving these issues. For years, healthcare leaders have faced mounting challenges with the cost, engagement, and availability of skilled clinical staff.
Veteran clinicians are leaving the profession in alarming numbers, with the average bedside nurse staying just three years. Meanwhile, aspiring nurses are choosing not to enter the traditional healthcare workforce—they see the burnout and know they don’t want to work under those conditions. Overworked teams and shifting generational expectations have led to a disengaged workforce, jeopardizing patient safety, care quality, and experience outcomes.
The constant staff turnover and skill-mix shortages are leaving labor costs stubbornly high. Instead of joining health system teams, many clinicians turn to staffing agencies or MSPs, which then sell their services back to the same health systems—often at a 20-50% markup. This perpetuates the cost problem.
What can healthcare leaders do about these issues? What are they doing already? And what are their plans to adapt to the new way of work this generation demands?
To answer these questions, we recently conducted a survey of senior nursing and HR leaders. The survey aimed to better understand current staffing barriers, workforce strategies, and emerging trends in healthcare staffing.
Methodology
Our survey methodology ensured that results represented a cross-section of U.S. hospitals. Responses came from over 1,200 healthcare leaders from diverse institutions. Because of the depth and breadth of responses, we’re confident these results offer insights applicable to any U.S. healthcare organization facing clinical staffing shortages.
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Nursing leaders
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HR leaders
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IT leaders
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Operations leaders
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Procurement leaders
They were from healthcare organizations of every shape and size, making it an intersectional and statistically relevant sample of healthcare workforce leaders.
Represents all org needs:
- Small hospitals: 10.77%
- Midsize hospitals: 17.63%
- Large systems: 19.88%
- Children’s hospitals: 16.06%
- Critical access: 24.88%
- Enterprise or national systems: 10.77%
Key Findings from the Report
1: The Shift Toward Flexibility
The worldwide cultural phenomenon of people calling the shots on how, when, and where they want to work has finally reached healthcare. And leaders witnessing a growing demand for flexible, gig-style work arrangements in their daily work:
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98% of respondents reported increased demand from nurses for gig-style schedules in the last 2 years.
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67% cited burnout due to lack of flexibility as a critical issue.
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45% indicated that over half of their nursing staff prefer flexible schedules.
Flexibility ranked as a top factor influencing nurse satisfaction
These results and the demand for greater flexibility should excite health care leaders. While it is challenging to fuel flexibility in scheduling at scale, nurses with greater flexibility exhibit better performance, higher engagement, and improved patient care. When you work to make their work fit their life, they show up better, perform better, take better care of patients, and are better ambassadors of your brand.
2. Market Pressures Demand Change
Post-pandemic rate stabilization provided temporary relief for many health care workforce leaders, but labor costs remain unsustainable. Survey data underscores this: 89% of respondents feel pressured to cut staffing costs.
Don’t just take it from the numbers, respondents spoke for themselves on unsustainable labor costs stemming from the traditional staffing model most still rely on:
“The financial squeeze is real: with labor costs escalating by 20-30% for every shift filled by travel or contract nurses, we’re facing a budget crisis that demands innovative solutions to our staffing woes.”
“Rethinking our staffing strategy is crucial, as relying on travel and contract nurses to fill shifts is a costly and unsustainable solution. In contrast, investing in our permanent staff and exploring flexible scheduling models can help reduce labor costs and improve staff morale. By adopting a more proactive and innovative approach to staffing, we can better manage our budget and prioritize patient care.”
“A sobering statistic, for every shift we fill with travel or contract nurses, our labor costs balloon by 20-30%, a stark reminder that our staffing strategy needs a serious reboot.”
“Filling shifts with travel or contract nurses significantly increases our costs, with hourly rates 1.5 to 2 times higher than permanent staff, plus additional agency fees.”
“It’s becoming alarming to think of the cost of recruiting staff.”
And it’s not just rate hikes and excessive fees from agencies and MSPs plaguing health care leaders. There are other significant challenges leaders face as they are staffing nursing positions on a 24/7 basis. The most impactful:
- Burnout 67.3%
- Unappealing shifts 65.6%
- Expensive rates 62.3%
- Shortage of qualified candidates 61.4%
- Credential matching and management 49.4%
- Float pool management 37.9%
3. Technology Will Play a Key Role in Workforce Evolution
The issues noted above probably aren’t news to you. Healthcare leaders know their models and current costs are unsustainable. They know they want to incorporate flexibility and more contingent labor workforce models.
But based on survey responses, most haven’t yet.
The majority of people surveyed specified that less than 25% of their workforce is travel, per diem or float pool today. 92% confirmed they had some kind of float pool. And the sizes of the float pools varied:
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30% were small (less than 100 nurses)
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27% were medium sized (between 100 and 300 nurses)
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Only 20% were large (more than 400 nurses)
Why have their current staffing models remained the same for so long? And why are most float pools still in their infancy?
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94% of respondents said they use technology to manage flexible staffing.
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92% indicated it was incredibly difficult to integrate this technology properly.
The technology they’re using hasn’t met their needs and remains difficult to use. 94% of respondents said they use technology to manage flexible staffing, but 92% indicated it was incredibly difficult to integrate this technology properly. It’s clear limitations and adoption barriers remain. The most common issues:
4: What Matters Most to Today’s Nurses May Surprise You
Based on these responses, it’s clear healthcare workforce leaders need to be able to better support flexibility. And since their current technology is failing them, considering a Contingent Labor Platform to assist with internal resource pool creation and management may help them institute these types of policies, faster.
Why is this so important? It’s important to nurses. Many nurses today feel burnt out due to the long hours, and lack of choice when it comes to working unattractive shifts. Today, full time nurses are 50% more likely to inherit the worst shifts at a hospital. This is contributing to their dissatisfaction and burnout.
With new contingent labor workforce models, contingent resources, like float pool staff, can take over the least attractive shifts. Taking the burden off full time employees and letting willing float pool staff choose these hours can drastically decrease dissatisfaction and burnout from all.
When asked what the most important factors are to their nursing staff respondents named flexibility as a top 3 factor 41% of time.
Other important factors included the ability to reduce the number of administrative tasks nurses perform and giving them the autonomy to pick locations and shifts.
5. Quality of Care at Risk
Outdated models jeopardize both workforce morale and patient safety. Respondents indicated that the disconnect between current models and the demands of today’s workforce impacts workforce engagement which continues to fuel attrition, and the vicious staffing cycle.
96% believe providing more flexibility and autonomy in scheduling will help attract and retain more qualified workers.
Question: Do you believe providing more flexibility and autonomy in scheduling would help you attract and retain more qualified workers?
- Yes 96%
- No 4%
78% of healthcare workforce leaders admitted that offering flexible work options were of the utmost importance for improving nurse engagement and morale.
Question: On a scale of 1 to 5 with 1 being not important at all, how important do you believe flexible work options are for improving nurse engagement and morale?
96% believe providing more flexibility and autonomy in scheduling would better help nurses feel more engaged.
Question: Do you believe providing more flexibility and autonomy in scheduling would better help nurses feel more engaged?
- Yes 96%
- No 4%
And it’s not just engagement and retention that are in jeopardy due to these outdated models and current healthcare workforce challenges. Most are concerned the problem may put quality of care at risk.
95% are concerned that nurse staffing shortages or ratios may impact the quality of care of patients.
Question: Are you concerned that staffing shortages or ratios may impact the quality of care of patients?
- Yes 95%
- No 5%
94% are concerned employee burnout or disengagement may impact quality of care for patients.
Question: Are you concerned that employee burnout or disengagement may impact quality of care for patients?
- Yes 94%
- No 6%
98% have observed a correlation between staff engagement levels and patient satisfaction or outcomes.
Question: Have you observed a correlation between staff engagement levels and patient satisfaction or outcomes?
- Yes 98%
- No 2%
63% of respondents had 25% or more of their shifts go unfilled due to staffing shortages
Question:What percentage of shifts are currently left unfilled due to a lack of available staff?
6. New Contingent Labor Models Could be the Key
But leaders acknowledge there are probably better ways to do business that would improve both clinician satisfaction and cost containment goals. Respondents indicated they would benefit from tools that provide more flexibility and autonomy. AND Nurses would benefit too.
96% anticipate that gig-style work will become a significant part of their staffing strategy over the next five years.
Question: Do you anticipate that gig-style work will become a significant part of your staffing strategy over the next five years?
- Yes 96%
- No 4%
95% believe providing nurses with a better work-life balance would help improve the quality of care they deliver on the job.
Question: Do you believe providing nurses with a better work-life balance would help improve the quality of care they deliver on the job?
- Yes 95%
- No 5%
Almost half (45%) of respondents think more than 50% of their current nurses would prefer to work on a flexible, gig-style arrangement.
Question: What percentage of your workforce do you think would prefer to work on a flexible, gig-style arrangement?
Specifically, many mentioned investing in contingent labor workforce models that offer flexible options in a way that’s easy for their teams and technology.
92% are currently developing or exploring alternative staffing models to attract and retain nurses (e.g., contingent labor models like flexible schedules, gig or local float pool roles)
Question: Are you currently developing or exploring alternative staffing models to attract and retain nurses (e.g., flexible schedules, gig or local float pool roles)?
- Yes 92%
- No 8%
94% also believe their organization would benefit from technology/apps that enable nurses to register and pick up shifts at their convenience, giving them more control over when and where they work.
Question: Do you believe your organization would benefit from technology/apps that enable nurses to register and pick up shifts at their convenience, giving them more control over when and where they work?
- Yes 94%
- No 6%
The Path to a Flexible Workforce: Don’t Just Outsource. Insource.
It’s clear that the traditional staffing models are quickly going to become things of the past. Which is good news for both nurses and healthcare workforce leaders.
How are they planning to move forward? By developing a homegrown, flexible workforce that’s empowered to decide how, when, and where they want to work, aligned with your org’s needs.
That’s where Hallmark comes in. We encourage our clients, and everyone in the industry, to evolve into the future of healthcare staffing. We’re helping healthcare organizations like yours build a modern clinical workforce that shows up more engaged, performs better, and costs less – because they work for you.
Our model infuses flexibility into what you’re creating – which is essential because the demand for flexibility and autonomy is not going away.
Next time you’re in a pickle because of last-minute staff cancellations, or nurse burnout, don’t just outsource staffing – insource. Hallmark has the workforce intelligence and staffing technology to help you build your internal team of flexible clinicians and source external talent only when necessary – all with one seamless platform.
It’s time to evolve traditional staffing models to meet today’s challenges. Flexible workforce models not only improve nurse satisfaction but also enhance patient care while reducing costs. Let Hallmark guide you toward a sustainable staffing future.