HR Challenges in the Healthcare Industry

Healthcare HR teams are juggling more than ever before. Workforce shortages continue to grow — the U.S. is expected to face a deficit of 100,000 healthcare workers by 2028, according to a study by Mercer, as regulatory requirements become increasingly complex and technology advances at an unprecedented pace.¹

HR challenges in healthcare go beyond filling positions or managing benefits. Your decisions directly affect patient care, safety standards, and life-or-death situations. A staffing shortage doesn't just mean longer hours for existing employees. It can mean delayed treatments, compromised patient outcomes, and increased risk across the board.

Common Human Resource Challenges in Healthcare

Let's look at specific healthcare HR challenges and why each one can have a ripple effect throughout the entire organization.

1. Staffing Shortages

One out of every six Americans is now 65 or older, creating much higher demand for healthcare services, but labor shortages mean fewer workers are available. Healthcare occupations need about 1.9 million new workers each year to keep up with growth and replace those who leave permanently, according to the U.S. Bureau of Labor Statistics. When critical roles remain empty, patients wait longer for care and existing staff get overwhelmed, creating a cycle that's tough to break.

2. Employee Retention

High turnover rates continue to be an HR issue in healthcare, particularly when it comes to talent management. Disengaged employees are 1.7 times more likely to leave, especially early-tenure staff, according to Press Ganey. Limited career development opportunities and unclear advancement paths can leave the healthcare workforce feeling stuck, directly impacting employee engagement and increasing the risk of turnover.

3. Employee Burnout

The emotional and physical demands of healthcare work can create a breeding ground for burnout, with overscheduling and unpredictable work hours destroying work-life balance. Burnout can lead to more sick days, lower productivity, and makes it much harder to retain employees — a common human resource issue in healthcare.

4. Competitive Compensation and Benefits

A frustrating catch-22 HR healthcare challenge is that tight budgets may make it difficult to offer competitive wages, yet losing talent to better-paying opportunities can cost even more in the long run. Healthcare pay gaps are wide: A Mercer study shows that many support staff make under $15 an hour, while nurses report feeling underpaid even though they keep patient care running.³ When you can't compete on pay, top performers may leave for organizations that can, leaving behind understaffed teams that struggle to maintain the quality of care patients need.

5. Intensive Compliance Requirements

From HIPAA privacy rules to OSHA compliance standards, staying up to date with constantly evolving regulations and detailed record-keeping requirements is a challenge of human resource management in healthcare. The stakes are high — an average of 17,314 HIPAA complaints are filed each year, according to the U.S. Department of Health and Human Services. Healthcare compliance isn't just about avoiding fines, but also about protecting both patient privacy and employee safety in an environment where mistakes can have serious consequences.

6. Staying Current on the Latest Technologies

As HR technology changes, HR professionals often find themselves caught between promoting innovation and managing staff who resist change. From performance management to electronic health records and telemedicine platforms, employees need ongoing support to adapt to new systems.

Solutions To Overcome HR Challenges in Healthcare

Tackling these HR issues in the healthcare industry doesn't happen overnight, but smart strategies can make a real difference. Here's a look at some options that may help healthcare organizations:

• Staffing Shortages: Partner with local staffing agencies and nursing schools to build a steady pipeline of talent. Jessica Vitous, Talent Enablement Partner at Paychex, expands on this: “Leverage technology to streamline recruitment through AI-driven applicant tracking systems, which will not only drive efficiency in processes but may also save time.” Focus on creating a workplace culture that people actually want to stay in — flexible scheduling, mental health support, and real work-life balance go a long way.
• Retention: Competitive pay and employee benefits matter but so does showing people they have a future at your organization. Regular check-ins, recognition programs, and clear career paths are proven retention strategies that help employees envision growing with your organization rather than looking elsewhere. “Improve employee engagement through digital and interactive platforms that offer recognition opportunities, streamline 1:1s, and enhance peer-to-peer communication,” states Vitous.
• Burnout: Give your staff room to breathe. This means adequate staffing levels, manageable workloads, and encouraging people to use their time off. Mental health resources and employee assistance programs aren't just nice-to-haves anymore. Vitous shares her own experience, “cross-training employees can help reduce burnout by ensuring staff are prepared to step in during callouts, minimizing disruptions and easing the workload on any one individual.”
• Compensation and Benefits: Get creative when budgets are tight. Professional workforce development opportunities, flexible work arrangements, wellness programs, and strong benefits packages can help offset pay limitations and improve employee morale.
• Compliance Requirements: Regular job training updates, designated compliance champions, and clear documentation processes can help everyone stay on track without drowning in paperwork.
• Technology: Roll out new tech with proper support. Comprehensive training, clear and consistent communication, ongoing support, and champions who can help hesitant staff adapt make all the difference.

When you address HR challenges in healthcare, everything else may get easier — from recruiting great people to keeping them happy and focused on delivering excellent patient care.