Healthcare workforce turnover increases amid mounting operational pressures

The Buzz This Week

Recent reports show health system workforce turnover and chief executive officer (CEO) departures ramping up in the coming year. This comes at a time when organizations already face significant financial challenges from the One Big Beautiful Bill Act, uncertainty around research funding, and rising costs including labor and supplies.

More than half of direct patient care workers (55%) expect to look for or accept a new role in the coming year, according to a recent Strategic Education Inc. survey conducted by The Harris Poll. Key drivers among respondents planning to leave include inadequate compensation and benefits (49%), burnout (48%), and a lack of career advancement opportunities (48%). Only 32% of healthcare employees reported feeling very valued by their employer, and only 37% said they were very satisfied with their job.

Trends in the C-suite also reflect high levels of turnover, according to a recent report by global outplacement firm Challenger, Gray & Christmas. Hospitals reported 85 CEO departures between January and August, up by nearly 6% over the same period in 2024. A surge of planned retirements of chief health system executives have already been announced, with more expected.

CEO succession planning, meanwhile, has lagged compared to other hospital board oversight objectives, according to The Governance Institute polls of roughly 370 hospitals and health systems from 2019 to 2023. Developing written succession plans for the CEO and senior executives may not be a priority because of the time and resources involved.

At the same time, efforts to promote from within have been inadequate. While a large proportion of health system executives plan to take this approach (80% of 131 respondents in SullivanCotter’s April survey), only two-thirds of health system executives said their workforce was adequately prepared for the transitions.

Why It Matters

These staffing and leadership trends may bode poorly for health systems as they manage a consistent rise in hospital occupancy and outpatient care from pre-pandemic levels. Operational pressures are increasing as a result of workforce shortages, an aging population, increasing chronic disease prevalence, and other trends.

Occupancy rates rose to 75% last year, up more than 11 percentage points since 2019, according to research published in JAMA Network Open. The key factor was a 16% reduction in staffed hospital beds. Continued demand growth and workforce shortages could push occupancy rates to 85% by 2032. This threshold is projected to result in longer wait times, medication errors, otherwise avoidable deaths, and other adverse events. Simultaneously, outpatient demand is rapidly growing, further straining the healthcare workforce.

With increased strain on front-line clinicians, addressing turnover will be imperative. Health systems can accomplish this with four key strategies: assessing the workforce needs, improving their daily work experience, reinforcing cultural connections, and advancing the organization’s supporting infrastructure. Because experiences differ within the organization, it is important to identify detailed pain points and drivers of burnout by department, unit, role, and other segmentations.

Such a workforce transformation requires ongoing two-way communication between senior leaders and front-line managers and staff, alignment, and financial investment. Successful organizations will see returns on staff health, engagement, and retention.

Without effective succession planning, health systems risk costly delays to vital initiatives like ambulatory expansion, digital and AI transformation, and partnership planning. Accelerating workforce development and leadership readiness is essential to sustaining strategic momentum. In addition to helping fill gaps in the C-suite in the near term, the investment in strengthening leadership development programs will boost the organization and its executives over the long term.