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The COMPENSATION TUMBLE

Hader, Richard

Nursing Management (Springhouse): August 2010 - Volume 41 - Issue 8 - p 26–31
doi: 10.1097/01.NUMA.0000387081.32566.12
Feature: Special: Salary Survey 2010
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If you believe that nursing is immune to the current economic downturn, think again. What's slipping through our hands...and how hard will it fall?

Editor-in-Chief

Richard Hader, RN, CNA, CHE, CPHQ, PhD, FAAN, is editor-in-chief of Nursing Management, and is the senior vice president and chief nurse officer of Meridian Health, N.J.

What's slipping through our hands...and how hard will it fall?

Nursing Management's Compensation Survey 2010 questionnaire was published in the January through April issues of the journal and online at http://www.nursingcenter.com/NMcompsurvey from January 1 through April 30. Franklin Communications, a research firm in Rockaway, N.J., tabulated data from 1,831 respondents.

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If you believe that nursing is immune to the current economic downturn, think again.

After surveying nearly 2,000* readers nationwide, we uncovered that the average salary has dropped 4.5% in the past 3 years. The new mean salary of a U.S. nurse leader is $80,170—three years ago, it was just shy of $84,000 ($83,930).

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Realities...

Many of you shared a stark reality...salaries are frozen, shift hours are cut, and team members hear that salaries will be static at best over the next few years. One respondent expressed grave concern: "My hospital is under bankruptcy...no raise for more than 3 years. All 401 matches have stopped, and pensions are frozen. If the government doesn't take over, it's gone."

Most of you are female (91.5%), and it appears as though your salaries suffered while your male counterparts' salaries gained. Since 2007, female nurse leaders experienced a staggering 5.2% decrease, dropping from $83,730 to $79,390. But male nurse leaders saw a 1.1% salary increase, up from $86,710 to $87,630. The largest majority of us (27.3%) hold the position of nurse manager, followed by director (17.5%), and educator (15.3%). (See Average salary by title.) Interestingly, almost 20% of you (19.8%) have "niche" titles, including certified nurse midwife, clinical applications specialist, clinical informatics leader, clinical nurse leader, electronic medical record specialist, and human simulation and research leader. This shows a significant increase in the demand for IT-related roles within healthcare over the past 3 years.

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Over 64% of you work in a hospital or health system as your primary place of employment. Others work in outpatient services, community home care, long-term care, rehabilitative care, subacute facilities, and academic settings. (See Average salary by work setting.) Most of you work in the city (43.2%), followed by the suburbs (32.4%) and then rural areas (23.8%). Nearly half of you work in a community not-for-profit setting, between 101 and 300 beds, followed by the private nonprofit setting. Take note: Almost 20% of you now work in for-profit healthcare agencies. And almost 18% are employed in a Magnet® facility, up from 13% in 2007.

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University-affiliated facilities continue to pay more than other healthcare organizations. (See Average salary by hospital type.)

The geographic spread across the United States mirrors findings from our 2007 survey. (See Average salary by region.) The Pacific region, similar to past survey results, continues to have the highest average salary at $99,590. Leaders from the East North Central region are paid the least at $75,590.

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...and disparities

Cultural diversity continues with lack in nursing leadership, as compared with the ethnicity of the overall U.S. population. An overwhelming majority of us are Caucasian (85.6%), 5.9% are Black or African American, 3.5% Asian, 2.8% Hispanic, and 2.2% American Indian or Pacific Islander. This contrasts the following U.S. Census Bureau findings from 2000: 80.2% Caucasian, 12.8% Black or African American, 1% American Indian, 4.3% Asian, and 14.4% Hispanic.1

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Although we've experienced a slight improvement in the number of minorities holding leadership positions since our last report in 2007, it's evident that continued mentoring of minorities to leadership roles in nursing is necessary, particularly amongst Hispanics, Blacks, and African Americans.

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Defining factors...

Our average length of nursing service is 16.74 years. Nearly 60% of us have been in nursing more than 20 years, 13.6% 11 to 15 years, 11.9% 16 to 20 years, and 14.5% less than 10 years. And the longer we've been in nursing, the more likely we are to have moved up the administrative ranks: 83% of VPs have at least a 20-year nursing career, compared with 60% of nurse managers and 34% of assistant nurse managers. Also, the lengthier the tenure, the higher the salary: 84% of nurses earning greater than $130,000/year have been nurse leaders at least 2 decades. (See Years in nursing by average salary.)

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About half of us are age 50 and beyond; only 17.3% are under age 40.

Sixty-four percent of us have held our current position for less than 5 years, and only 7% have been in a leadership position for greater than 16 years. This statistic confirms a Nursing Management survey finding published earlier this year that indicated 49% of nurse leaders will retireby the end of this decade.2 Those of us currently in leadership positions have a lengthy career asa clinician, but a relatively short career inmanagement.

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There's been no elevation in educational levels of professional nurse leaders in the past 3 years. The number of us holding a national certification has dropped from 44.6% in 2007 to 41.3% today. Likewise, the percentage of master's-prepared nurse leaders decreased 2.8%, while the number of doctorally-prepped leaders remained flat at 2.6%. The majority of nurse leaders have a bachelor's degree in nursing or a related field (36.9%), while 20.7% have a diploma or an associate degree in nursing.

A higher level of education does yield an economic advantage. Those of us with doctoral degrees earn an average annual salary of $96,620—over $20,000/year more than those with a bachelor's degree. (See Education by average salary.)

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Eighty-two percent of us manage 100 people or less, but oversee significant budgets of between $100,000 and $1,000,000. A majority of us are responsible for one business unit, but slightly more than 30% of us are responsible for between 2 and 5 units.

Sixty percent of respondents earn a flat percentage of an annual increase, while the remaining 40% must attain specific goals to receive a raise. Most of us aren't eligible for incentive compensation (bonus), but 67% of respondents received matching contributions to retirement savings accounts. Only 30% of us will receive employer health benefits when we retire.

Salaries appear to coincide with the overall responsibility of the position. Vice presidents earn the most at an average of $126,400/year, and case managers earn the least at $62,410/year. (See Average salary by title.)

The more time you clock each week, the more you earn. Those working greater than 70 hours/week earned about $114,000/year, while those working between 40 and 45 hours/week earned $74,390/year.

(See Average salary by weekly work hours.) Salaries at Magnet facilities outpace non-Magnet organizations by nearly 6%. (The mean Magnet facility nurse leader earns $84,590/year, while those at non-Magnet institutions make $79,640/year.)

The amount of raises has dropped from an average of 3.34% in 2007 to 2.3% in 2010. All job categories except consultants saw at least a 1% decrease in raises, which didn't appear to be reflective to the length of service in the position. (See Pay raise by position and Pay raise by experience.) Several leaders shared that due to union contracts, staff nurses still received raises, while managers' salaries were indefinitely frozen.

State hospitals are also suffering from the economic downturn. One respondent indicated, "As a state employee, I've experienced a decrease in compensation of 80 hours as dictated by the governor in an effort to help balance the state budget."

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...in unsettling times

The poor economy is keeping leaders working longer than they'd expected. Not only are wages being frozen, but so are contributions to retirement funds. Many leaders commented that companies are freezing or eliminating retirement benefits, taking a toll on the overall morale within the organization.

Almost 60% of surveyed leaders believe that they're not appropriately compensated for their level of responsibility within the organization. However, many say they're privileged to be working in this downward economy. Remarked one respondent, "We felt lucky to receive any raise in this financially uncertain time."

Similar to many industries, healthcare leaders are feeling the fallout of the economic tumble. Although salaries have been reduced, there's no evidence from this survey that the workload has increased. Nurse leaders continue to work about the same number of hours per week as they have traditionally, and aren't responsible for more staff members or greater fiscal aspects than before the economic crisis.

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No one shared news of significant reductions in management. And although we're feeling the economic squeeze, most of us are still gainfully employed.

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REFERENCES

1. U.S. Census Bureau, 2000. United States Census 2000 .
2. Hader R. Nurse leaders: A closer look. Nurs Manage. 2010;41(1):25–29.
© 2010 by Lippincott Williams & Wilkins, Inc.