Key Lessons and Strategies for 2025

As it has over the past four years, the healthcare landscape continues to undergo significant shifts, particularly regarding workforce strategy. Pandemic-induced demand surges, economic pressures, technological advancements, and evolving workforce dynamics have all played key roles in shaping the industry.

As we enter 2025, healthcare executives must reflect on these trends to anticipate future challenges and generate opportunities to move beyond traditional staffing models and embrace a more holistic approach called Total Talent Management. This strategy builds a resilient, adaptable workforce that is essential in the modern healthcare environment.

Understanding Total Talent Management and Its Importance

Total Talent Management is a strategic approach that integrates all aspects of workforce planning into a unified system, including full-time employees, contract workers, per diem staff, and gig-based professionals. Instead of viewing workforce segments in isolation, Total Talent Management ensures health systems, hospitals, and physician practices optimize staffing efficiency, cost-effectiveness, and workforce sustainability.

Why Total Talent Management Matters in Healthcare

• ‍Workforce Agility – Healthcare demands fluctuate due to seasonal trends, public health crises, and demographic shifts. A Total Talent Management approach enables your organizations to quickly adapt by leveraging a mix of permanent staff and contingent workers.‍
• Cost Optimization – By balancing direct hires with flexible workforce solutions, you can manage labor costs more effectively, reducing overreliance on more costly travel staffing models.‍
• Quality of Patient Care – Effective Total Talent Management ensures the right professionals are in place at the right time, improving patient outcomes and reducing burnout among your physicians and clinicians.‍
• Technology Integration – AI-powered workforce analytics and predictive staffing models enable your team to make data-driven hiring decisions, aligning workforce supply with patient care demands.‍
• Competitive Advantage – Organizations that implement a cohesive talent strategy will be better positioned to attract, retain, and develop top-tier healthcare professionals in an increasingly competitive labor market.

By embracing Total Talent Management, you can create a more sustainable and resilient workforce, positioning your organization for long-term success.

Lessons from 2020-2024: A Data-Driven Analysis

The need for a more integrated approach to talent management is driven by fluctuations from the pandemic era to the recent gradual stabilization. By analyzing key data points from 2020 to 2024, healthcare executives can extract valuable insights to inform future workforce planning. Understanding these trends will be crucial in developing resilient staffing strategies that align with evolving patient care demands and economic realities.

AHSA's 2024 Demand Report recently examined the four-year trends in workforce strategies, bill rates, and hiring. AHSA identified these four lessons:

1. Pandemic-Driven Surge and Post-Pandemic Stabilization

‍The COVID-19 pandemic triggered unprecedented demand for healthcare professionals, with open job orders for nursing skyrocketing from 18,164 in early 2020 to a peak of 78,276 in Q3 2021. Similarly, allied health professions saw an increase from 5,927 to 22,495 during the same period. Bill rates followed suit, with nursing reaching a high of $127.92 in Q1 2022 before declining steadily.

However, as the pandemic receded, demand for healthcare workers normalized. Open orders for nursing steadily declined from their 2021 peak, stabilizing at approximately 25,303 in Q3 2024 before a slight rebound to 29,850 in Q4. Allied health roles followed a similar trend but with a more consistent downward trajectory, ending 2024 at 14,873.

Key Takeaway: The volatility in demand underscores the need for adaptable talent strategies. Healthcare systems and physician groups should focus on balancing full-time staff with flexible, on-demand workforce solutions to manage future surges effectively.‍

2. Economic and Market Pressures Impacting Bill Rate

The steady decline in nursing bill rates from $127.92 in early 2022 to $78.34 by the end of 2024 highlights cost-containment efforts by healthcare institutions. Allied health bill rates, on the other hand, remained relatively stable, fluctuating within the $84–$90 range over the past two years.

This divergence suggests that while nursing demand fluctuated sharply, allied health roles experienced a more gradual adjustment. Economic pressures, including budget constraints and reduced reliance on travel nurses, contributed to these shifts.

Key Takeaway: Workforce planning must incorporate cost-effective talent management models while ensuring competitive compensation to attract and retain top professionals. Strategic use of contract labor, per diem staff, and direct hiring can help balance financial and operational needs.

3. Geographic Variability in Workforce Needs

Regional trends indicate that states like California, Wisconsin, Texas, and New York have consistently led in job orders, with California maintaining the highest bill rates at $91.20. These variations are driven by state-specific labor laws, population demographics, and healthcare infrastructure.

While national demand stabilized in 2024, certain regions continued to experience higher-than-average bill rates and workforce shortages.

Key Takeaway: Healthcare executives must adopt region-specific workforce strategies, leveraging data analytics to predict local talent needs and allocate resources accordingly.

4. The Future of Nursing and Allied Health Talent

Looking at the broader 2020-2024 trends, it is evident that nursing roles experienced sharper fluctuations in both demand and bill rates, whereas allied health roles remained relatively stable. Notably, radiologic technologists emerged as the most in-demand allied profession, commanding one of the highest bill rates ($97.27).

Key Takeaway: Organizations should invest in workforce development programs, particularly for allied health roles, to mitigate potential shortages and build a more resilient talent pipeline.

To get a copy of Demand Report that analyizes the four-year data, click here.

Predictions for 2025: What Lies Ahead?

As healthcare organizations adapt to a post-pandemic reality, workforce trends continue to evolve, requiring strategic adjustments in talent management. While demand and bill rates have largely stabilized, emerging factors such as demographic shifts, technological advancements, and regional disparities will shape the healthcare labor market in 2025. By anticipating these changes and leveraging data-driven workforce strategies, healthcare executives can proactively address staffing challenges.

Here are four healthcare workforce predictions for 2025:

1. Continued Stabilization with Targeted Growth Area

While overall demand is expected to remain stable, certain specialties may see increased demand due to aging populations, technological advancements, and evolving care models. Radiologic technologists and specialized nursing fields (e.g., critical care, OR, and oncology) may experience steady or increased demand.

2. Technology-Driven Workforce Optimization

AI-driven workforce management solutions and predictive analytics will play a crucial role in optimizing Total Talent Management. Healthcare systems will increasingly rely on technology to forecast demand, manage shift allocations, and improve efficiency.

3. Shift Toward Integrated Workforce Model

With bill rates normalizing and temporary labor costs stabilizing, more healthcare facilities will invest in permanent hiring while maintaining hybrid models that integrate per diem, travel professionals, and gig-style workforces for flexibility.

4. Regional Disparities Will Persist

States with historically high bill rates will likely continue to face workforce challenges, necessitating innovative recruitment strategies and incentive programs.

Final Thoughts

The lessons learned over the last four years emphasize the importance of adaptability in Total Talent Management. By leveraging data-driven insights, embracing technology, and developing strategic workforce plans, healthcare leaders can navigate the evolving landscape effectively in 2025 and beyond.

As the industry moves forward, the key to success will be balancing cost efficiency with workforce sustainability while ensuring quality patient care remains at the forefront of talent management decisions.

To get a copy of AHSA's 2024 Demand Report, click here. AHSA's team is also available to discuss how your organization can implement smarter, more flexible workforce strategies. Contact us today by calling (800) 930-5119 or emailing marketing@ahsa.com.