Politics, Economics, and Nursing Shortages: A Critical Look at United States Government Policies

Rob Elgie, BSN, RN, BC


Nurs Econ. 2007;25(5):285-292. 

In This Article


For half a century, nurse shortages and surpluses have cycled mainly on the side of shortage (Buerhaus et al., 2003). Recent shortages can be traced back at least 4 decades to the move of nursing education from hospital-based educational programs to college-based educational programs. As a result, hospitals lost access to a free supply of nursing students to run hospital wards. Since that time, the government has maintained much of the nursing supply with subsidies that lower incentives for nurse employers to provide fair compensation and reasonable working conditions.

As noted by Beam and Conlan in 2002, grants "allow federal officials to claim credit for addressing particular problems" (Andrews, 2004, p. 265), but do not ensure that the problems will actually be solved. While parts of the NRA may be popular for benefits to nursing in general such as public service announcements, nurse residency grants, nurse internship grants, workforce diversity grants, and the comprehensive geriatric education grants, they are unlikely to contribute much toward balancing nursing supply, demand, and compensation. NRA programs that are based on voucher agreements are particularly disruptive to market equilibrium and put downward pressure on nurse wages, benefits, and working conditions.

How our health care system can afford to compensate nurses what they are worth is a separate but related question. Why the United States health care system ranks first in the world for percent of gross national product spent on health care, while "the health of the U.S. population is painfully unequal" (Kubzansky et al., 2001) is not addressed in this article. Regardless of how it is achieved, the true economic worth of nurses will only be evident when nursing market equilibrium is achieved.

Whatever the cost, only policies that facilitate equilibrium between the free market forces of supply, demand, and price can successfully resolve the nurse shortage challenge. The demand for nurses and nursing instructors can be met and maintained for generations to come with policies that expand roles and reimbursement for APNs and encourage the nurse and nursing instructor labor markets to correct themselves by providing fair compensation under Magnet status working conditions. Politics and policies meant to correct the nursing shortage should focus less on how to reduce the cost of producing nurses, and more on how to afford to compensate nurses with wages and benefits that achieve market equilibrium.$


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