U.S. workers are starting to receive smaller bonuses. According to a recent Bloomberg report, the average cash bonus for December 2023 was $2,145, a 21% drop year over year.
Experts laid the dipping bonuses at the feet of corporate bel- tightening because of a loss of talent. That includes the health care industry.
As reported by Becker’s Hospital Review, Gusto groups health care and the social assistance industry sectors together. Both sectors experienced a 16% decrease in average year-end bonuses from 2022 to 2023. That resulted in a drop from $873 to $734.
The health care industry is facing a worker shortage crisis, making the loss of talent a major concern. In November 2023, American Nurses Association president Jennifer Mensik Kennedy, PhD, RN, penned an op-ed where she described the shortage as having hit a major breaking point.
“The nurse staffing crisis is an urgent pain point for the country’s more than 5 million nurses, for patients, and for the entire health care system,” Kennedy wrote in The Hill. “In the last year, nurses have taken action to demand solutions to insufficient staffing levels, burnout, workplace violence and low wages, at both the state and national level. While this crisis is not new, the proverbial breaking point has arrived.”
According to Gusto principal economist Liz Wilke, who spoke to Bloomberg, 16 of the 22 industries the payroll software company tracks have seen declines in the number of workers who receive any kind of bonus. While the biggest drop has been observed within the arts and entertainment industries, the health care industry is also feeling the sting.
“What surprised me was some of the industries where we’ve been talking about challenges finding talent, like food and beverage, health care and retail,” Wilke told Bloomberg. “I didn’t expect to see the magnitude of the declines in those sectors specifically.”
Wilke explained that multiple factors are at play. Businesses are not hiring as aggressively as they did in 2023, they have less money to offer workers after distributing above-average bonuses for two consecutive years, and workers are voluntarily quitting at the lowest rate since September 2020.