Study Links Nurse Shortage to Pay That Lags Behind Inflation

How can hospitals attract and keep much-needed nurses? The answer is simple, according to a new study based on U.S. Bureau of Labor Statistics: Increase nurses' wages at a rate that keeps them from falling behind inflation.

The study found that between 1996 and 2000 -- a period when hospitals began to complain of a serious nurse shortage -- average pay for nurses declined by 1.5 percent when inflation was taken into account. But wages after inflation increased by 2.4 percent for hospital nurses in 2001, and the result was a flood of job applications -- with staff size increasing by 9.2 percent. Nurses' salaries continued to increase until 2003, when wages and the number of practicing nurses began to decline again.

The analysis, by the Institute for Women's Policy Research, found that the connection between rising wages and the availability of nurses is often ignored in studies about how to attract more bedside nurses. The institute found that only 11 of 49 recent studies, produced by federal agencies, state commissions, industry and academic researchers, concluded that raising wages at a rate above inflation would help solve the hospital nurse shortage.

The report, funded by the Service Employees International Union, found that Oakland, Calif., had the highest median wage for hospital nurses at nearly $39 an hour, while Memphis had the lowest at about $19.50 an hour.

-- Marc Kaufman