This report analyzes the current and anticipated nursing shortage in America and making recommendations to alleviate that shortage in the future.  This report reviews major policy issues related to the nursing workforce, drawing upon prior Urban Institute work, new literature review, assessment of federal survey data, and key informant interviews.

From the report:

Nurses constitute the backbone of health services, spending the most time with patients and playing a key role in promoting quality and medical safety. Nursing has faced recurrent short‐term labor market shortages as shown by vacancy rates reported by employers. Intermittent shortages vary by state and are normal, as the market is not static but responds to shifting supply and demand. Unpredictable shifts in both supply and demand can also occur, as seen in the current economic downturn.  However, there are now long‐term structural issues as well. The aging of the population of Americans will increase demand for nursing care while retirements will reduce the nursing workforce available to care for them. The large generational bulge of nurses who were educated in the long expansionary period of the late 1960s and 1970s are now nearing retirement age, and the succeeding age cohorts of nurses are smaller.  Nursing wages serve as a signal both to would‐be nurses and to nurse employers and thus affect both supply and demand. Lower wages reduce the attractiveness of nursing as a profession and so reduce supply. At the same time, they increase demand for nurses by lowering employers’ total wage bill. Wages that do not accurately reflect the value of nurses’ contributions allow employers to use them at less than their full capabilities. Conversely, higher wages draw more people into nursing and drive employers to use the more costly input more efficiently. Some efforts to combat shortages, such as importation of foreign‐trained nurses, offer temporary relief but may exacerbate the problem by depressing wages in the short run. The frequently cited projections of future large shortages of nurses are based mainly on demographic trends and past patterns in supply and demand. The different projections produce a broad range of shortage estimates and should not be relied upon to provide policymakers with a precise number of nurses that will be needed at any particular future time.

Full report: Professional Nurse Workforce Dilemmas: Understanding and Responding to Dynamic and Complex Market (PDF | 711.19 KB)

The Urban Institute Health Policy Center. (2009). The nurse workforce challenge: understanding the nursing workforce, public policy for a dynamic and complex market. Bovbjerg, R. R., Ormond, B.A. & Pindus, N.