How to Hire and Retain Nurses in a Tight Labor Market

Updated on March 23, 2019

By Jim Thomas, Ph.D.


As the largest single component of the hospital workforce, nothing has a greater impact on the quality of care than nursing. But many organizations are finding it increasingly difficult to keep nursing jobs filled. Many parts of the US are already experiencing a nursing shortage as the industry grows faster than schools can produce qualified graduates. Today’s healthcare organizations must have highly efficient and effective talent acquisition processes to get their fair share of this scarce talent.

But the talent shortage isn’t just a recruitment and hiring concern. The problem is exacerbated by poor retention. Turnover for all nurses averaged 16.9 percent in 2017, second only to hospitality workers. The picture is even worse for new nursing grads – about one in five quit within the first 12 months. This frightening scenario will only get worse as organizations compete more aggressively for an increasingly limited supply of nurses.

Thriving in this tight labor market requires a combination of talent acquisition and retention excellence. Consider the three-pronged approach some of the most successful organizations take when selecting and on-boarding nurses and nursing managers:

Define important behavioral competencies.

Traditional selection strategies for nurses generally do an adequate job evaluating knowledge, training and technical skills. Where they can fail is in the areas of motivational fit (work schedule, pace of work, amount of autonomy or teamwork, and time spent with patients), and evaluating behavioral competencies (emotional intelligence, collaboration, patient focus, resiliency, and adaptability). Successful organizations take the time to clearly define these critical characteristics so they can be systematically evaluated and considered when making hiring decisions. 

Become better at interviewing candidates.

Almost every selection process includes at least one interview. And in many cases, the process may include multiple interviews. But an all-too-common problem is that these interviews are conducted by poorly trained interviewers who operate outside the bounds of a well-designed process. Decades of research demonstrate that these unstructured interviews have almost no value when it comes to predicting retention or success on the job.

Successful organizations take a very different approach. They ensure that interviewers are trained and provided with a concise, easy-to-use, consistent interview guide built around validated job competencies. Here again the research evidence is clear – these two simple steps dramatically improve the predictive power of the interview.

Use proven behavioral assessments to support both hiring and retention.

Nearly 75 percent of successful companies in other industries increase their odds of selecting the right candidate – and reducing turnover – with pre-employment behavioral assessments. But with a shortage of candidates and higher-than-average turnover, screening and testing efforts may get branded as “hiring obstacles.” Organizations abandon assessments because of a near-sighted view that assessments are only valuable for screening candidates out of their selection process. 

But successful organizations understand that assessments can yield valuable insights about candidates that can aid with retention. They use these insights to create proactive, personalized retention strategies that slow down the revolving door for talent. Without the information provided by pre-hire assessments, leaders often take weeks or months to fully understand what motivates and engages their new employee. And, by that time, the new hire may already be lost!

Final thoughts

The nursing shortage is a complex, costly problem. It requires a thoughtful and comprehensive strategy that starts with a structured and diligent three-step selection process that allows organizations to quickly select top talent and inoculate against turnover. Assessment processes that provide deep insights into candidates’ skills and motivation are not barriers to hire. When properly understood they can be the signposts that point the way to addressing the nursing talent challenge. 

Before you press the reset button on your hiring and testing process, ask yourself if you’re still operating with a “screen out” mindset. Rethinking how and why you use tools may actually help your organization thrive in this tough market for talent.

Jim Thomas, Ph.D., is a PSI Services vice president who’s held a variety of roles spanning consulting, business development, and general management in his 30+ years as an Industrial Psychologist. His work developing assessment and diagnostic solutions has literally taken him around the world, including extended assignments to the Middle East and China.

The Editorial Team at Healthcare Business Today is made up of skilled healthcare writers and experts, led by our managing editor, Daniel Casciato, who has over 25 years of experience in healthcare writing. Since 1998, we have produced compelling and informative content for numerous publications, establishing ourselves as a trusted resource for health and wellness information. We offer readers access to fresh health, medicine, science, and technology developments and the latest in patient news, emphasizing how these developments affect our lives.