Nursing home salaries — including those of executives — continued their upward trajectory with many facilities responding to staffing shortfalls by increasing hourly rates and offering signing bonuses, according to the industry’s largest, annual salary survey released Monday.
The salaries and bonuses of executives appeared larger than historical averages, according to an expert who told McKnight’s Long-Term Care News on Monday that the pay mix could be changing to reflect younger top hires.
“So much of the money over the last couple of years was going to the frontline staff and lower paid employees,” said Matt Leach, a senior consultant with Total Compensation Solutions LLC. “We’re seeing the pendulum swing more toward executives.”
Leach noted that the higher salaries and bonuses could be due to having to attract new talent as a result of turnovers, or younger executives might be more interested in early career bonuses instead of waiting for a larger payout at retirement.
For the first time, the survey collected vacancy rates by position. Providers reported a 14.51% annual vacancy rate for executives. Nearly 21% of all positions were vacant across job roles throughout the year.
Nursing home administrator salaries averaged $127,763, up 3.6% from $123,324 in 2022. Assistant administrators enjoyed a 5.69% average increase, up to $92,514 from $87,533 in 2022. Meanwhile, directors of nursing saw their average pay climb 4.67% from $103,954 in 2022 to $108,889.
The findings are from the 2023-2024 HCS Nursing Home Salary & Benefits Report published by Hospital & Healthcare Compensation Service (HCS) in cooperation with
LeadingAge and supported by AHCA, and they look good for employees. The survey provides compensation data on more than 111,600 employees in 46 management and 54 nonmanagement positions with 41% of the responding facilities operating as not-for-profit and 59% as for-profit.
Although the pay raises for RNs, LPNs and CNAs dropped from 2022, they remain nearly double the traditional increases of 3% to 5%. RNs saw an increase of 7% (down from 11.1% in 2022); LPNs enjoyed an increase of 8.9% (down from 9.4% a year earlier); and CNAs saw an increase of 9.7% (down from 11.15% in 2022).
The national hourly pay rate for RNs in 2023 was $37.86; for LPNs, it was $29.66; and for CNAs, it was $18.68.
Well more than half of the 1,089 responding facilities — 62% — said they used agencies to augment their nursing staff while 65% said they use sign-on bonuses to attract employees. Leach said his firm’s clients usually pay out bonuses in halves, first on day one of employment and then after six months on the job.
“In terms of being able to compete with the Targets or Amazons of the world, in theory, organizations feel like that, by offering sign-on bonuses, they can get the employee in to experience the culture, and that’s something that someone like Target just won’t be able to offer” Leach told McKnight’s Long-Term Care News on Monday.
Leach cautioned that the rise in salaries and hourly rates along with high agency usage and signing bonuses are not sustainable over the long term. But for now, bonuses and higher salaries are two of the few options that employers have to attract lower wage positions such as certified nurse aides over retailers that can offer higher starting wages.
Eighty percent of the 65% of respondents who said they offered signing bonuses said the benefit was offered in three or more positions or departments: 48% of participants reported offering sign-on bonuses for RNs, with an average bonus of $4,879; 46% offered bonuses for LPNs, at an average of $3,770; and 40% gave CNAs bonuses, averaging $2,157.
Various measures used by operators to stabilize their workforces may be working as year-over-year turnover declined for the first time since 2020, according to a statement from HCS. It noted that turnover rates for RNs dropped to 39% in 2023, approaching the typical rate of 30% to 35% seen prior to 2020; LPN turnover, meanwhile, decreased to 38.21% in 2023, moving closer to the standard 30% rate seen pre-2020; and CNAs declined to 50.83%.
What’s more, 78% of respondents said they planned to hire new employees this year, and 22% said they would maintain current employment levels.
The full Nursing Home Report is available for $375. To order online, visit www.hhcsinc.com.