New analysis from the RCN today exposes the UK Government’s flawed policy of relying heavily on recruiting nursing staff from overseas and agencies, and letting undervalued, experienced staff quit the profession.
The analysis, by London Economics (LE), shows how the use of an agency or an internationally recruited nurse costs the NHS up to three times more than giving an experienced nurse a 5%-above-inflation pay rise, which the RCN is calling for to start making up for a decade of real-terms pay cuts.
The UK Government has put its focus on intensive international recruitment to try to fill the 47,000 vacant nursing posts in England, while reliance on temporary staff has increased because of staff shortages. Almost half (48%) of new joiners to the UK nursing register are internationally recruited, with the vast majority appearing to move to England.
Costs incurred in recruiting nursing staff from abroad include recruitment agency fees, visa applications, travel, accommodation and examination fees. With agency staff, a premium is charged because they come via a recruitment agency.
The new analysis reveals how a significant pay rise for nursing staff would be far more cost-effective than the existing situation. Analysis shows the cost of international recruitment per nurse is 2.4 times the cost of giving a 17.3% pay rise to an experienced nurse – £16,900 as opposed to £7,100.
Similarly, the true cost of hiring agency nurses is three times more than the cost of matching the RCN’s NHS Agenda for Change pay claim of RPI inflation + 5%, standing at £21,300 compared to £7,100 per nurse. The spending cap on agency nurses in England is regularly exceeded, meaning costs are currently spiralling given the staff shortages faced.
The RCN is balloting 300,000 of its NHS members over strike action amid record numbers of unfilled nursing posts.
RCN General Secretary and Chief Executive Pat Cullen said:
“At a time of grave financial uncertainty and record nursing vacancies affecting patient care, ministers must do what is fiscally responsible. It is a false economy to let experienced staff walk away over poor pay and conditions only to spend more recruiting internationally.
“Our NHS is built on the shoulders of our international colleagues and agency nurses play a vital role in patient care, but the UK Government must strengthen the domestic workforce and ensure we have long-term, sustainable solutions for the health and care crisis.
“With demoralised and unvalued nursing staff leaving the profession in their droves, the need to pay nursing fairly, to spend money wisely and protect our NHS could not be more pressing.”
The analysis is published today in a new RCN report warning of the dangers of failing to invest in strengthening the nursing workforce in England.
The report, called 'Investing in patient safety and outcomes: health and care nursing workforce and supply in England’, says the failure to invest in our domestic workforce as demand for healthcare in England soars poses the “greatest risk to the publicly-funded health and care services since their creation” and that “fair and appropriate pay is the only policy lever available for immediate impact on nursing retention”.
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Notes to Editors
The RCN’s ‘Investing in Patient Safety and Outcomes’ is available here.
The London Economics analysis found that the cost of a pay rise at 5% above inflation is significantly lower than the costs which arise from recruiting to fill registered nursing vacancies.
This analysis is based on the salary of nurses at the top of Band 5 (Spine Point 23 – 2021/22 rates) in England, which represents an experienced member of the nursing profession. The analysis is undertaken at the margin and considers the cost of a nursing vacancy in the year after a nurse leaves the profession. It compares the estimated cost of hiring one nurse (or paying for temporary staff) to the cost of a pay rise for the nurse that left the profession.
The analysis considers all relevant on-costs incurred by employers (including National Insurance contributions and pension contributions).
Alongside considering one-off recruitment costs (such as visa or interview costs), the analysis considers ongoing costs of covering nursing vacancies (i.e. through bank and agency nursing). The modelling assumes standard shift patterns and does not account for high-cost area supplements to ensure comparability. If these were considered, the cost of filling a nursing vacancy would be higher than that stated in the analysis, which reflects the conservative approach taken in the analysis.
The July 2022 figure for RPI of 12.3% is used, as that was the level of inflation when the UK Government announced that it was accepting the NHS Pay Review Body’s recommendation of a below-inflation pay rise. The RPI + 5% pay rise (17.3%) is relative to the 2021-22 Agenda for Change pay scale.
The cost of international recruitment - the UK Government’s main strategy for boosting registered nurse numbers in England - is 2.4 times the cost of giving a 5% + inflation pay rise to an experienced nurse considering leaving the profession (£16,900 vs. £7,100).
The cost of agency nurses under the NHS price cap of 55%, set by NHS England (which takes into account holiday pay and on-costs) is around £4,200 per year less than the cost of a 5% + RPI pay rise. However, the price cap is regularly exceeded through use of the ‘break glass’ clause, which allows employers to exceed that cap where there is an exceptional and direct risk to patient safety. The true cost of agency staff is estimated at three times the cost of a 5% + RPI pay rise (£21,300).
Another way NHS trusts fill vacancies is by using bank nurses. These are a pool of nurses and healthcare assistants which each trust has who can work as and when it suits them if there are shifts available to cover shortages, sickness, maternity leave, etc.
For trusts that can fill vacancies using only bank nurses, this option is less expensive (£5,100) than a 5% + RPI pay rise (£7,100). However, not all shifts are covered by bank nurses, so the true cost of managing nursing shortfalls is likely to be much higher because of the more common mix of bank and agency staff used to cover vacancies. Assuming that half of shifts are undertaken by bank nurses and half by agency nurses, the average annual cost of a temporary nurse is £13,200 higher than the baseline 2021-22 salary rates, and £6,100 higher than the cost of a 5% + RPI pay rise.
The International Council of Nurses estimates that the global shortage of nurses will stand at around 13 million by 2030: Sustain and Retain in 2022 and Beyond- The global nursing workforce and the COVID-19 pandemic.pdf (icn.ch)
During the last year (up to March 2022), 48% of new joiners (23,406 out of 48,436) to the UK register were trained internationally. As of March 2022, 17% of the total register in England were trained internationally (102,982 out of 591,453) and 18% of the total UK register were trained internationally (136,662 out of 758,303). All those statistics can be found here: https://www.nmc.org.uk/about-us/reports-and-accounts/registration-statistics/
The RCN’s strike ballot will close on November 2.
