The New Zealand Aged Care Association recently surveyed aged care providers about registered nurse (RN) wage costs and turnover, as part of the Association’s investigations into the cost pressures affecting providers.
The survey found that the average pay for RNs working in aged residential care is now $30.33, an increase of $2.16 (7.7%) from that recoded in December 2017. Meanwhile the average pay for clinical managers is now $38.58, an increase of $3.82 (11%) from December 2017.
Meanwhile RNs working in DHBs will get a further 3% increase on August 5, with a new top step introduced in May the new top step will have a base rate of $36.02. This will serve to further increase the gap.
David Wait, NZNO’s industrial advisor for aged care believes the gap between aged care and DHB pay rates has not been understated.
“Nurses progress through the wage scale each year, so it is likely that the majority of nurses have a base rate that exceeds even the upper quartile of the results in the NZACA survey.
“When the value of conditions such as shift leave, overtime, weekend and rates etc are added, nurses working in DHBs are paid significantly more than those working in aged care.”
Regarding RN turnover, the survey looked at the period from July 2018 to May 2019. For this ten-month period RN turnover has been around 37%. When including those working out their notice the figure increases to 38% and if extrapolated to a full twelve-month period an annual turnover of around 42% is indicated.
Fifty per cent of respondents perceived an increase in departures over the past year. Among these providers, the most commonly given reason for the increase (by 73% of them) was that RNs are leaving for better pay in the DHBs. Some respondents considered that DHBs were targeting RNs in aged residential care in their recruitment drive.
Some respondents think other factors are also contributing to the high turnover, including the higher demands of nursing in aged care compared with working in a hospital. Some also indicated that new migrant RNs and new graduate RNs are seeing aged care as a stepping-stone towards employment by DHBs rather than as a long-term career preference.
Whatever the reason, turnover can be costly for organisations. As a 2013 article published in Journal of Nursing Management shows, the cost per registered nurse turnover represents half an average salary, with the highest costs relating to temporary cover and productivity loss.
David Wait believes the onus is on both providers and the Government to close the gap.
“Aged care providers and the Government as the ultimate funder of aged care services need to address the significant gap in pay that nurses working in aged care suffer over colleagues in other sectors and woefully inadequate staffing levels must be raised to levels that don’t cause aged care workers to burn out and look for other opportunities.”
Wait says the sector seriously needs to address pay and working conditions in order to make aged care nursing a more attractive career option.
“A large number of nurses prefer the aged care setting, but poor pay and a pressured working environment leave many looking for other choices. With an ageing nursing workforce, providers who can create a working environment which supports nurses and fairly rewards them for the work they do will be able to attract and retain a greater proportion of the nurses they currently employ for longer.”
However, NZACA chief executive Simon Wallace argues that it shouldn’t fall to aged care providers to have to plug the pay gap for nurses. With most providers facing rising cost pressures, they aren’t in a position to be increasing wages. They simply can’t match the pay rates of the DHBs because of the capped funding they get from the government.
“The fact is that aged care is a critical mainstream function of our healthcare system – yet is not valued as such.
“Until we pay aged-care nurses the same as hospital nurses, we will never attract a strong workforce of Kiwi nurses, no matter how much training we provide.
“As a society, if we really value the care of our older people, we must have pay parity across a common pool of nurses in our healthcare system.
“Until we do, we will continue to send the message that how we care is not fair.”