Daily Editors' Notes

Cost of doing business about to rise for many providers

Share this article:
John O'Connor
John O'Connor

It's not quite in the dirty-little-secret category, but here it is: The nation's recent economic downturn was good for the bottom line at many urban long-term care facilities.

That's because a struggling economy drove up unemployment, and put many more job candidates in play who had little or no bargaining leverage. But it appears that change is in the wind.

Mark Zandi, chief economist at Moody Analytics, noted that providers in metro regions are already beginning to experience spot labor shortages. And the challenge will only worsen in the year to come, as the job market continues to improve.

In fact, jobless rates in most metro areas are already below the 5.2%-to-5.6% benchmark the Federal Reserve considers full employment, according to the Bureau of Labor Statistics That's a far cry from 2010, when only two metro areas had rates south of the 5% mark.

You don't need to be an economist to figure out what this will mean for many operators: a chronic staffing challenge is likely to get worse. And solving it will likely cost more than ever. Already, many providers are beginning to raise wages, improve benefits and add new perks in an effort to lure or keep competent employees.

As the saying goes, where you stand usually depends on where you sit.

If you are an employee, the changing economy would appear to mean that after a years-long slump, better opportunities and wages may finally be at hand. But if you happen to be signing the paychecks, you could soon find yourself pining for the good old days.

Share this article:

Daily Editors' Notes

McKnight's Daily Editor's Notes features commentary on the latest in long-term care news. Entries are written by Editorial Director John O'Connor on Monday and Friday; Staff Writer Tim Mullaney on Tuesday, Editor James M. Berklan on Wednesday and Senior Editor Elizabeth Newman on Thursday.


    More in Daily Editors' Notes

    Want to know what 'secrets' you'll soon be sharing? Buy a car

    Want to know what 'secrets' you'll soon be ...

    As never before, data collection and analytics have become part and parcel of long-term care. Even midsize and smaller operators are sifting through amazingly granular information to document strengths, address ...

    There's an app for that, but should there be?

    There's an app for that, but should there ...

    Some apps - like those that are meant to track blood pressure or give medication reminders - are geared toward your future residents. And that's where the trouble can arise, ...

    Could you make money if Mom's nursing home does a good job?

    Could you make money if Mom's nursing home ...

    A man recently raised more than $51,000 ... to make potato salad. And in a similar type of online campaign, senior living investment company Mainstreet raised more than $1.6 million ...