Hospital workers have a demanding, critical job that takes unique skills, compassion, and dedication. It’s no wonder employers value their employees, and for a group of recently announced companies, they are doing so with higher wages. But what is the impact of compensation adjustments and how will they influence healthcare hiring trends across the healthcare employment landscape in 2025?
Overview of Recent Pay Increases
In February of 2025, several hospital systems announced plans or increases for workers’ companies, including:
- SEIU Healthcare Pennsylvania for UPMC Washington Hospitals with a new labor contract that includes 12% raises over the next three years, with some workers eligible for up to 19%.
- The Guthrie Clinic in Pennsylvania launched a new benefits plan that incorporates a 3% wage increase for nearly all providers.
- Providence St. Vincent Medical Center in Oregon approved a tentative agreement with wage increases over the next two years, ratification bonuses, and guaranteed future pay adjustments.
- Providence Women’s Clinic in Oregon will provide Registered Nurses with a 4-20% raise, with contracts for physicians and providers increasing between 7.5-15%.
- Columbia Memorial Health in New York put in place a 4-year agreement with 22.5% increases phased in over the contract and boosted starting hourly wages to $18.
These are a handful of the increases announced just in February. A look back over the previous months shows several other organizations boosting pay, according to data shared by Becker’s Hospital Review. These increases impact healthcare hiring trends across the industry in numerous ways.
Motivations Behind the Increases
Why the increases? Multiple potential reasons exist, including:
- Staff shortages: The American Hospital Association shares that a 100,000-critical care worker shortage is likely by 2028, while a shortage of nearly 73,000 nurse assistants is also likely.
- Enhancing employee satisfaction: Employee burnout is high in this industry. One report indicates turnover in U.S. hospitals stands at 20.7%. Increasing employee satisfaction could reduce this figure.
- Competitiveness: Employers must remain competitive in their benefits packages to minimize the risk of employees going from one company to the next.
Immediate Impacts on Healthcare Hiring Trends
Upping wages certainly impacts the individual workers receiving those benefits, but there are also enhancements to the healthcare industry as a whole, including:
- Attract new talent: Higher wages may drive more applicants to your location, including from regions or industries outside of the local community.
- Reduction in vacancy rates: Offering a higher wage for hard-to-fill positions could help fill long-standing openings with qualified talent, enhancing the overall system’s efficiencies. This could be critical in an aging population.
- Changes in recruitment strategies: For many healthcare systems, these wage increases force a look outward, away from internal promotions and development as the only opportunities for filling positions.
Long-Term Implications for the Healthcare Workforce
The immediate impact is promising for workers, but for companies, it’s critical to think about the long-term healthcare hiring trends implications for higher wages.
- Standardization of competitive salaries: These immediate pay increases influence an industry-wide adjustment to match leading pay scales. Now, more healthcare systems must take a closer look at their current wage structuring process to remain competitive.
- Healthcare cost impact: Higher wages increase labor expenses, even when justified or necessary, which drives up operational budgets. Healthcare systems must plan for more money spent on employees, scaling back other programs as needed to do so.
- Enhanced retention: Over the long term, better salaries impact morale, improve employer branding, and encourage happier workers capable of providing better patient care. That could influence patient outcomes as a result.
Challenges and Considerations
To make such changes possible to keep up with healthcare hiring trends, systems must overcome several challenges:
- Budget constraints: Not all hospital systems and clinics have operating budgets large enough to accommodate such significant wage increases. That’s challenging for smaller hospitals that are facing increasing pressure from the rise in overall operational costs.
- Potential wage inflation: Increasing salaries across the healthcare industry could impact overall economic wage growth, driving up the cost of living and creating broader economic implications as a result.
- Equity among staff roles: All workers within the healthcare system may not receive the same percentage increase, which could create some disgruntled employees. Ensuring fair compensation across all positions and departments while meeting budgetary constraints is a critical challenge.
The Importance of Planning for Future Wage Growth
Organizations watching to see how other healthcare systems do to support employees is just a starting point. Implementing your own policies to remain competitive across the industry is critical. Increased wages will increase your hiring and retention efforts across the board.
As you consider future healthcare hiring trends, wages will likely be at the top of the list of changes to make. Future increases are likely as the value of healthcare workers escalates due to shortages and increasing demand. Companies must update employment practices in healthcare to meet this scope while still operating within a competitive budget. Developing effective strategies to overcome budgetary constraints and build improved relationships could be critical to remaining a top brand to work for within your community.
Healthcare administrators should take note of these increases, assess where they stand, and then adapt their compensation strategies proactively. With the guidance of MRINetwork, it’s possible to build a stronger plan to ensure your system meets and exceeds expectations in these and other healthcare hiring trends.