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Labor Market Research : Nursing

07 Dec 2016Career


This paper discusses the Labor Market of Nursing. The paper outlines the statistics in the United States and then focuses on the state of California. A demand and supply explanation is also provided in the paper. Nurse Wage Structure is also provided in the last part of the paper.

Nursing is known to be an in-demand job in the United States. According to Dr. Lovell of Institute for Women’s Policy Research, the health care system of America is dependent mostly on nurses. On the average a patient is being attended by a nurse for 6.3 hours a day (Lovell, 2004) and for patients with more acute needs 7.8 hours a day is needed. Forecasts show that there is an increasing trend of nurses that is needed in the United States of America. According to the U.S. Bureau of Labor Statistics the demand for the year 2004 to 2019 the number of employed nurses will grow by 29 percent. This is equivalent from 2.4 million to 3.1 million. These statistics show that there is a big demand of nurses in the country. The focus of the study is the state of California. From here on, the discussion would be regarding the state of California.

California is one of the states that has been featured in the first labor market of California’s Nurse Work Force Initiative in January 2004. As per the report, California needs a total of 60,000 nurses to meet the projected demand for nursing services in 2020. The government in response to the shortage of the nurses, Governor Gray Davis had announced a Nurse Workforce Initiative. This particular program had been developed and implemented to recruit , train and retain nurses in the state. NWI’s report as of 2004, the nursing force of California is around 280,000 registered nurses and 90,000 Licensed vocational nurses. Registered Nurses are employed frequently as compared to the licensed vocational nurses because of the educational background and scope of practice. According to Briggance (2004), the state of California has the lowest ratio of registered nurses among the 50 states.

The reasons for the increasing demand and inadequate suppliers cannot only be judged based on numbers. According to NWI (2004), the dominant determinant of the demand is the size of the state’s population. The higher the population the higher the need for health care services. There is a large population of people because of the high birth rates in the state, the international immigration and low death rates. The wealth of the  population affects the demand for services. In January 2004, there has been a legislation  about a minimum licensed nurse to patient ratios requirements in hospitals from Assembly Bill 394. The increase in demand because of this law is estimated to be as low as 1,600 nurses.

The supply of nurses on the other had been explained  by NWI. The inflow of California nurses comes from the education system, migration from other states and migration from other countries. The California supply  of  registered nurses then comes from Active License status, these are the currently working nurses and the non working. The outflow of nurses is retirement, migration to other countries and career changes. According to a research from the U.S. Government Accountability (Lovell, 2004), the shortage of nurses is caused by job satisfaction problems. These job satisfaction problems is then answered by the hospitals through increasing compensation and benefits of the nurses.

Hospital wages vary depending on the local labor market (Lovell, 2004).  As of 2004, California is considered as one of the states that give their nurses high compensation. Median hourly wages for a nurse is $38.85 to $19.44 in Virginia. Nurses have large compensation because of the job satisfaction problems that some had encountered. Since hospitals wanted to attract nurses then it is imperative that they increase the compensation of the nurses. Another reason for a high compensation is that hospitals and nursing homes are known to be one of the riskiest nations. Nurses are exposed to latex allergies, bhck injuries, physical assault, blood-borne pathogens,and pollution from waste incineration, disinfectants, and surgical waste.

Workers such as nurses who are exposed to greater risks on the job should be compensated for the risk associated with their occupation. Based on California Nurses Association (2004), the structure of the nurse wages depends on the level of experience and the type of Nurse that a person is. There are six levels of Nurses in California. First is the Clinical Nurse which has four levels. Clinical Nurse is considered as the entry-level position. Next is Practitioner which has 2 levels. A Nurse Practitioner has a higher wage as compared to that of the clinical nurse because this category has a higher level of experience. A nurse’s pay is computed hourly.

Based on the following information stated above, nurse wages compensation are determined by the demand and supply of nurses in California. California is a big state as compared to that of the other states in the U.S. Compensation for California is higher than the other states because of the fact that it has the lowest Nurse to patient ratio in the continent. Some may think that the Nurses are overpaid and some may think of it as a health commodity job. However, there are reasons for the amount of compensation that the nurses received and this can be justified through the law of economics, and the risk that the nurses take because of the call of duty.


  • California Nurses Association (2004). Nurses – NX. Retrieved last February 28, 2008 from University of California.
  • Briggance, B. (2004). Nursing, Leadership and Strategic Action (Powerpoint Presentation). Center for Health Professions Retrieved last February 29, 2008 from University of California, San Francisco.
  • Lovell, V. (2004). Solving the Nursing Shortage through Higher Wages. Retrieved last February 29, 2008 from Institute for Women’s Policy Research.
  • Spetz J., Rickles J., and Ong P. (30 January 2004). California’s Nursing Labor Force: Demand, Supply and Shortages. First Labor Market Report. California Nurse Work Force Initiative. Retrieved last February 28, 2008. From Univesity of California.

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