Executive summary: Future of the U.S. Healthcare Industry: Labor Market Projections by 2028 

Our report “Future of the U.S. Healthcare Industry: Labor Market Projections by 2028” explores the critical issue of healthcare worker shortages in the US, offering a comprehensive review of data to estimate future shortages or surpluses and recommendations for addressing these gaps.

The report answers four questions about the healthcare  labor market:

1. Where will the greatest gaps exist?
2. Which healthcare occupations will see the greatest changes in supply and demand?
3. How will gaps differ by occupation across geographies?
4. How will current trends in compensation inform future talent strategies?

Based on Mercer research, publicly available data, and data provided by our partner Lightcast, Mercer created metrics on labor supply and demand to evaluate and estimate labor market conditions in the future.

Projections were made up to 2028 based on historical data up to 2023. The study examined variability in jobs, geography, and compensation.

Every state is different in terms of the shortages and surpluses of healthcare labor projected by 2028. However, some states (like California, Texas, and Pennsylvania) are expected to have a surplus of healthcare workers while others (like New York and New Jersey) are expected to have acute shortages of workers.

In addition to geographic variation in these findings, there are variations based on specific healthcare roles.

• Nationally, a surplus of Home Health and Personal Care Aides (HHAs) is predicted, but shortages are expected in states like New York, New Jersey, and Connecticut.
• A Nursing Assistant (NA) shortage is expected to be severe with only 13 states projected to meet or exceed demand.
• Registered Nurses (RNs) are projected to exceed demand by about 30,000 by 2028, although states like New York and other East Coast states are expected to experience shortages.
• A national shortage of Nurse Practitioners (NPs) is predicted with California, Texas, and New York experiencing the greatest deficits.
• While a moderate surplus of physicians is expected across all specialties, significant shortages are projected for primary care physicians, especially in California, Texas, and New York.

Recognizing the potential for deficits and surpluses in healthcare talent in specific talent markets can help healthcare organizations prepare and think strategically about their talent acquisition and retention practices.

Based on these findings, four key recommendations are presented. 

1. Understand your specific supply/demand risks by occupation and department. Determine where the greatest risks of not filling vacant positions may impact healthcare quality. Consider whether the local talent market is sufficient to fill gaps and, if not, what changes in talent strategy need to be adopted.
2. Strengthen your supply pipeline by reconsidering sourcing and recruitment strategies and process, including the consideration of building talent internally and partnering with local universities and trade schools for training.
3. Retain existing talent by fine-tuning the employee value proposition through pay and benefits, schedule flexibility, career growth opportunities and job satisfaction.
4. Implement initiatives to reduce demand for hard to fill roles by identifying tasks that can be automated, redistributed, or eliminated.

Compensation will play an important role in attracting and retaining healthcare talent. Variability in pay across geographies may prompt workers to relocate for better pay. For employers looking to understand the dynamics of their local labor markets, compensation is a crucial lever for attraction and retention of scarce talent.

Given the difficulties many healthcare employers are currently experiencing in filling key roles, and projections suggesting that these challenges are not going away in the near future, the successful employers will be those who accelerate their talent strategy and workforce planning practices; proactively identify and quantifying their labor risks and taking action to mitigate those risks.