Senior Housing Industry Labor Shortage

The senior housing industry has attracted so much attention in the past few years. New capital has entered the market place. Developers have built and plan to build even more facilities over the next couple of years. With the demand for skilled nursing and assisted living facilities and other healthcare properties increasing day by day, it’s simple to see why the senior housing industry grows at the rate that it does.

However, not all aspects of the senior housing industry grow at the same rate. While there is an unprecedented amount of facilities opening; for operators opening these new facilities, there is little talent to staff these new buildings and deliver the quality of care necessary to meet industry standards (or requirements).

Work in the Senior Housing Industry Fails to Attract Talent

The fact of the matter is that currently immigrants occupy the majority of low-skilled labor in the senior housing industry. Some operators and industry veterans suspect this has to do with the differing attitude immigrants have toward senior citizens. While American workers tend to be ageist and find working in the senior housing industry at the facility level unattractive, those from foreign countries exhibit greater levels of respect and responsibility towards the senior community.

This makes for great labor simply because immigrant workers are often more compassionate and caring, delivering better quality care than their natural born American counterparts, at a lower requested wage.

Low-skilled Labor is Affordable in the Senior Housing Industry

In addition, employing immigrant Americans for the senior housing industry makes economic sense. Simply stated, immigrant workers are willing to do more for less compensation as opposed to conventional American workers.

By a simple calculation, operators and administrators easily see that employing immigrants as entry level labor in the senior housing industry is the most cost-effective solution. Because this type of labor requires little skilled knowledge, there is no need to overpay despite the heavy workload. For now, this is the model that works financially.

However, with so many facilities opening in the senior housing industry and even more people needed to work these facilities, labor—and specifically skilled labor— is becoming a pressing issue. For now, there may be enough low-skilled labor to fill the need, but there is already a shortage of administrators, advanced caregivers, managers and other upper division employees.

The Senior Housing Industry Needs Changes

Investments specialists within the senior housing industry agree that eventually at a minimum, larger companies will need to hire and train their own staff members. Education and training are becoming fundamental for employees on all levels in the senior housing industry.

Currently, with the rise of competition, operators work to cut down on operational costs. However, constantly cutting corners with low-skilled labor may cut down on quality of care, which residents will most certainly notice.

In order to keep businesses open and beds filled, the quality of care must deliver what’s expected from their residents. The senior housing industry can become just as attractive to talent as large hospitals and PCP offices. It is simply a matter of making some changes.

First, raising the entry level wage rate becomes necessary. Even though higher compensation and training will cost money and time these changes will hopefully yield better quality care and longevity of both residents and staff. With longer lasting results operators can rely on maximum profitability with a full roster of residents and a dependable staff.

Work with the JCH Group in the Senior Housing Industry

While the overbuilding of facilities will work itself out with time, the question of labor remains a concern. Altogether, the senior housing industry will identify the necessary changes and find a solution to the labor shortage. In the meantime, the JCH Group can help you navigate your next senior housing investments.

With real-time information, extensive experience and expert advice, the JCH Group helps you make your mark in the senior housing industry. Meet your investments specialist. Call the JCH Group today.

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