MinnEcon: June 15, 2010 Archive

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Are colleges oversupplying nurses?

Posted at 12:00 PM on June 15, 2010 by Paul Tosto (27 Comments)
Filed under: Health care

With our aging population, it's been a given that health careers will be in high demand and that we have a huge shortage of nurses heading into the future.

But is that conventional wisdom wrong? We started asking that question last week as the Twin Cities one-day nurses strike loomed.

We highlighted projections from the research group Economic Modeling Specialists Inc.

Researchers there saw our post and did some more digging.

The result? Data that should have us all asking if the nation's public and private colleges are producing too many nurses.

Below is a chart EMSI created showing the number of students completing a nursing program last year and its projection of annual registered nurse openings through 2015. (Definitions are at the bottom of the post).

At first glance, it's jaw dropping -- Minnesota schools with nearly 4,300 students completing a nursing program last year with only about 2,600 openings expected annually through 2015. Nationwide, EMSI estimates an oversupply of more than 85,000 nursing graduates a year, with only Alaska and Nevada facing a shortfall.

Yes, there are caveats.

No data is perfect. The completions data from the federal government's Integrated Postsecondary Education System (IPEDs) don't indicate if those who completed a program went into nursing. It likely also counts people who are in nursing currently and moving up the degree ladder. It also assumes the projections are valid.

But I'm highlighting the EMSI research for a couple reasons. The Minnesota State Colleges and Universities system uses EMSI's projections. And EMSI is using IPEDs data, which is about as consistent as it gets.

As with our our first post, we don't have all the answers. We have some data and it's pretty compelling.

If you have insights or better data, let us know and we'll highlight it in future posts.

Later this week, we'll be posting from interviews with Minnesotans who follow nursing graduate trends, including Jane Foote of HealthForce Minnesota , a public - private effort to increase the number of workers in the state health system.

"The situation in most areas probably isn't as out of whack as the numbers suggest," says EMSI's Josh Wright.

"There are still lots of job postings for RNs and other more specialized nurses. But anecdotally, we're hearing more and more how nurses in certain areas can't find jobs. It's a complicated issue, but clearly there is a supply / demand imbalance -- as EMSI's data suggest."

Part of the problem is that no one collects all the data in one place in a form that's most useful. So we're still groping to understand the data and answer the question about the supply of nurses in the education pipeline.

It may not be a crisis but with the numbers in front of us now, it's an issue we need to probe.

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Here are the definitions for the EMSI data:

Completions: The number of students in a given year that completed a specific course of study as reported to the federal government
Integrated Postsecondary Education System (IPEDs), the federal government's

IPEDS accounts for all colleges and universities that participate or are applicants for any federal financial assistance program authorized by the Higher Education Act (HEA), which includes most of the well-known federal loans (e.g., Pell Grants, Stafford Loans). All public colleges and universities and a number of private postsecondary schools accept federal assistance loans and therefore are included.

Annual Openings: The sum of new and replacement jobs (see below) in the occupation over the entire selected timeframe (in this case 2010-2015), divided by the number of years in the timeframe. Just as a caveat: Our 2010 numbers are only partially projected, so we divided by five (2011-15).

Replacement Jobs: The number of job openings (over a given timeframe) expected in an occupation as the result of turnover--e.g., employees changing occupations, retiring, etc. It is derived by multiplying estimated annual turnover by the number of years in the given timeframe.

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The educational "haves" and "have nots"

Posted at 11:27 AM on June 15, 2010 by Chris Farrell (0 Comments)
Filed under: Jobs & unemployment

From chief economics correspondent Chris Farrell

The American economy is starting to mend from the Great Recession, the nastiest downturn since the 1930s. The return to growth and better economic numbers is welcome, although a number of nerve wracking problems lurk in the global economy, especially Europe's sovereign debt crisis and China's slowdown.

Yet assuming that the expansion remains intact, it will still take a long time for the worst labor market in 60 years to show signs of vigor. The unemployment rate is steep at 9.7 percent and the unemployment-and-underemployment rate is even higher at 16.6 percent.

That's bad news for the job and income prospects of most workers, from blue collar employees looking to earn a paycheck at a retail store and on a factory floor to white collar managers seeking a spot in a cubicle and an office.

These are catastrophic numbers for workers with less education and less skill. Recessions often accelerate an underlying economic transformation that has been gaining momentum for years. Well, it has been apparent for the three decades that the earnings gap between those workers with a college degree and more and those with a high school degree only and less has been widening. Take this chart created by David Leonhardt of the New York Times in a recent article on the value of a college education.

The unemployment disparity between the educated haves and have nots is striking. Below are two charts of unemployment rates between 2000 and May, 2010. They look very similar at a quick glance. But the perecentage differences are striking.

Here is the unemployment rate of of those 25 and older with less than a high school diploma since 2000. Over the past decade the unemployment rate for this group never got below 6 percent. It has been 15 percent or more since May 2009.

Contrast that experience withthe unemployment rate of workers 25 and older with a BA or more.

The unemployment rate of this group over the past decade hasn't breached 5%. Little wonder more and more people worry that America is evolving into a two-tier society.

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