Workforce retention and wages in nursing homes: An analysis of managerial ownership

Summary

The research paper "Workforce retention and wages in nursing homes: An analysis of managerial ownership" by Huang and Bowblis, published in 2020, explores the relationship between managerial ownership and workforce outcomes in nursing homes. The central hypothesis was that administrators holding a significant equity stake in their facilities—referred to as owner-managers—might influence the retention rates and hourly wages of nursing staff (nurses and nurse aides). The study employed a multivariate regression analysis using data from a sample of for-profit nursing homes located in Ohio, covering the period from 2005 to 2015. This methodology allowed for a direct comparison of workforce outcomes between facilities managed by owner-managers and those overseen by salaried managers. The researchers controlled for various factors to isolate the effect of managerial ownership on employee retention and compensation. This approach aimed to provide robust evidence on how different organizational structures at the administrative level might influence the stability and compensation of direct care staff in nursing home settings. The key findings revealed that, on average, nursing homes operated by owner-managers demonstrated higher workforce retention rates for nursing staff. This positive effect on retention was even more pronounced in owner-managed facilities that were part of a larger chain. Surprisingly, the study found that this improved retention was not achieved through higher wages; there was no evidence of significantly higher hourly wages for nursing staff in owner-managed nursing homes compared to those with salaried managers. The authors suggest that the enhanced retention without increased wages might stem from other mechanisms, such as greater autonomy for owner-managers to implement policies and foster a work environment conducive to staff satisfaction and retention, while simultaneously maintaining financial sustainability. The organizational structure associated with managerial ownership thus appears to be a significant factor in promoting staff stability.