New Zealand's 'headcount paradigm'

As the world continues to recover from 2020, it’s natural to tally the past year's impacts. Whether it be the countless jobs that were lost or the upheaval experienced by the healthcare industry, it’s hard to fully gauge the impacts that COVID-19 has had on the economy and job markets. Globally, the unemployment rate has increased an average of 2.2% among advanced economies. Countries like Australia and New Zealand saw these numbers increase to roughly 7%, while North America has seen unemployment numbers peak at around 10%. Consider these figures from November 2020:

  • New Zealand unemployment was at 6.8%, up 2.7% from pre-COVID

  • Australian unemployment was at 7.7% up 2.1% from pre-COVID

  • American unemployment was at 8.6%, up 4.3% from pre-COVID

  • Canadian unemployment was at 9.4%, up 2.8% from pre-COVID

  • British unemployment was at 4.6%, up 0.6% from pre-COVID

  • German unemployment was at 5.9%, up 0.9% from pre-COVID

Though job losses in the global travel and hospitality industries were most widely reported on, another sector received attention for critical shortages of available staff. In 2020, national healthcare systems around the world were put under more pressure than at any other time in modern history. Reporting in North America focused on the duration of shifts among medical staff. Accounts of doctors, nurses and support staff being outnumbered by more than 20 to one were also common. Though these stats might seem alarming to some, they brought to light a long-held concern in the global health sector.

Over the last 30 years, the ratio of patients to medical professionals has increased year-on-year as populations increase in average age and the number of healthcare professionals entering the sector decreases. This has resulted in what Scott Arrol, CEO of Dementia New Zealand has coined the ‘headcount paradigm’. In short, the headcount paradigm is the growing scarcity of healthcare professionals required to maintain safe staffing requirements in hospitals, clinics and residential care facilities.

By law, healthcare providers in New Zealand need to maintain a healthcare staff-to-patient ratio of roughly 1:5 for hospitals, and more than 1:7 in aged care facilities. When legislation establishing the minimum number of staff for healthcare providers was passed in 1987 and 1994 respectively, the number of qualified staff capable of filling these roles was approximately one staff member for every three patients. Now more than 30 years later, the sector is struggling to meet these basic staffing requirements.

Over the past years, Scott and I have spoken at length about this escalating problem and how new technologies can be harnessed to support our health sector. More often than not the conversation turned to how the use of artificial intelligence and smart systems can best engage available resources, while inbound immigration can compensate for the diminishing number of domestic healthcare professionals. This was seen as a sensible short-term solution to New Zealand’s healthcare problems... That is, until last year, when borders around the world closed and the number of new healthcare workers entering the workforce reduced by more than half.

The many shocks of 2020 forced a reckoning within the healthcare sector. With the lessons of last year and the headcount paradigm fresh in our minds, I can’t help but look at this long-standing problem with more optimism than I have in the past. Part of this optimism is because of the work we’re doing at Skillet to optimise and support healthcare workforces, and the incredible partnerships we've formed along the way.

Beyond Skillet, my optimism is due to changes that were enacted earlier this year to address the shortages and stresses faced by our healthcare system. From a significant increase in accessible funding, to the reskilling of new healthcare workers, and even reforms to District Health Boards, we’ve entered a new era of empowerment for both our healthcare systems and our communities. And so as New Zealand continues with its vaccination rollout and we progress steadily into 2021, I look forward to seeing the headcount paradigm eventually become a problem of the past.

21 March 2021