Good news for assisted living operators is that, according to Bureau of Labor Statistics data, employment in the sector has returned to pre-pandemic levels.
“We’re back. All those jobs have been finally restored, which is fantastic news,” National Investment Center for Seniors Housing & Care Chief Economist and Director of Outreach Beth Burnham Mace told me at the organization’s recently concluded Spring Conference in San Diego.
It took the assisted living industry longer to recover on the employment front than it did for overall US employment, she pointed out, but assisted living is seeing a faster recovery in this regard than is skilled nursing, where employment remains 14% shy of its pre-COVID level.
Why the difference between assisted living and skilled nursing?
“The trend in skilled nursing for a long time actually has been a slowdown in employment growth, and that has been continuing, so it’s been harder to refill those positions,” Mace said. “And I think that the jobs that some skilled nursing workers have to do may be perceived differently than those for assisted living. And there might also be different hiring practices that we’re seeing.”
More good news overall, however, is that temp agency use appears to be down, and especially for assisted living.
“That’s important, because that means that that expense impact will be lessened,” she said. “We know that wages and salaries typically account for about 60% of overall expenses, so if they could whittle that down a little bit, that would be really helpful.”
It’s not all sunshine and roses for assisted living employers, however. Even before the pandemic, recruiting and retaining workers was the top challenge. That is, pre-pandemic employment was not at an ideal level, and “there also have been some growth opportunities” over the past few years, Mace said.
The need today, she said, “goes through the entire organization. …It’s not just the frontline workers; it’s everyone.”
Almost all other types of employers are challenged as well, except perhaps tech and mortgage-related companies, where layoffs have occurred, she pointed out. Unemployment is at 3.4%, the lowest level since 1969. “That’s a really tight labor market,” Mace said.
Data from NIC’s Executive Surveys with senior living and skilled nursing participants show that the perceived severity of staff shortages is easing. In March/April 2022, for instance, 27.3% of participating executives reported severe staff shortages, compared with 8.8% in September/October 2022. And of these executives, 6.1% said that staffing shortages were minimal in March/April 2022, but 19.3% said they were minimal in September/October 2022.
But Mace said she thinks that the quest to hire and retain a sufficient number of employees will “be a challenge for a while, especially with that low unemployment rate.”
On the other hand, she said, “there might be some relief if the unemployment rate goes up a little bit. That might make a bit of a large labor pool from which to draw upon.” The catch, Mace said, is that “those aren’t necessarily the same workers that we want to be working in our industry or that are good at working in our industry.”
One possible solution to workforce challenges is immigration system change, but that “doesn’t seem to be really getting very far in Congress today,” she noted.
An area more within an operator’s control, however, is marketing. Long-term, Mace said, “strategic marketing plans need to be expanded to attract residents but, more importantly than ever, to the workforce and potential new and existing staff and team members.”
Lois A. Bowers is the editor of McKnight’s Senior Living. Read her other columns here.