The 2025 Retrospective and 2026 Horizon

Healthcare Staffing Trends: Lessons from 2025 and What to Expect in 2026

The healthcare staffing industry went through major changes between 2025 and 2026. After the intense demand of the pandemic years and the uneven recovery that followed, 2025 became a year of stabilization and adjustment. Instead of rapid growth, the industry faced cost pressures, regulatory changes, workforce fatigue, and growing use of technology. These shifts reshaped how hospitals hire staff and how healthcare professionals experience their work.

In the United States, healthcare staffing revenue declined by about 6% in 2025, landing at $39.4 billion. While this marked a slowdown, it also reflected a return to more normal conditions after years of crisis-driven spending. However, the impact was uneven across different staffing segments.

Market Performance: Where Growth Slowed and Where It Continued

Travel nursing, which had once been the industry’s biggest growth driver, experienced a sharp decline. Revenue fell to approximately $14.2 billion, driven by reduced hospital demand, lower bill rates, and widespread use of internal staffing pools instead of outside agencies. Many health systems now operate their own internal travel programs, allowing them to reduce reliance on external staffing agencies and control costs more effectively.

In contrast, locum tenens staffing, which focuses on temporary physician coverage, continued to grow. This segment expanded by about 6% in 2025 and is expected to keep growing into 2026. The main reason is a persistent shortage of physicians, especially in high-acuity specialties and rural areas. Unlike nursing, physician supply cannot be quickly increased, making locum tenens an essential solution for many hospitals.

Allied health staffing saw mixed results. While overall revenue declined modestly, demand remained strong in specific areas such as imaging, radiology, and therapy. Per diem nursing declined as hospitals increasingly preferred internal float pools over external agency staff.

Hospital Finances and the Growing Rural Care Crisis

The financial health of hospitals played a major role in shaping staffing trends. Many rural and independent hospitals struggled in 2025 due to rising labor costs and the expiration of pandemic-era support. These pressures were intensified by the “One Big Beautiful Bill” Act, which reduced Medicaid funding by nearly $911 billion over ten years. As a result, 338 rural hospitals were identified as being at risk of closure.

One of the most visible consequences of these financial pressures was the closure of maternity units. In 2025, many rural hospitals shut down labor and delivery services, creating “maternity deserts” where patients must travel long distances for care. While this reduced access to care, it also increased demand for locum OB-GYNs and labor and delivery nurses at the remaining regional hospitals.

Regulatory Shifts in the U.S. and Canada

Regulatory changes took very different paths in the United States and Canada. In the U.S., federal policy moved toward deregulation. One major change was the repeal of the CMS Minimum Staffing Rule for long-term care facilities, which had required specific nurse staffing ratios. This reduced the expected surge in demand for nurses in nursing homes but raised concerns about patient safety.

At the same time, Canada introduced strict controls on agency staffing. Ontario implemented the Healthcare Staffing Agencies Act (Bill 44), which capped agency pay and restricted recruitment of hospital employees. 

Workforce Resistance, Burnout, and Emotional Numbness

Healthcare professionals responded to these pressures with increased organization and activism. Strike activity in 2025 was more strategic, targeting high-impact moments to apply pressure on employers. Beyond burnout, leaders began to describe a deeper issue: emotional numbness. This state reflects not just exhaustion, but disconnection and loss of engagement.

Technology, AI, and Legal Challenges

Technology became both a tool and a source of conflict in 2025. A major lawsuit against UnitedHealth over the use of AI to deny Medicare Advantage claims was allowed to proceed, establishing that companies cannot hide behind algorithms to avoid accountability. This case raised concerns about how AI is used in healthcare decision-making.

At the same time, hospitals expanded the use of virtual nursing, where remote nurses support bedside staff. While many hospital leaders saw this as essential to future care delivery, frontline nurses protested its use, citing concerns about patient safety, staffing ratios, and loss of clinical autonomy. 

Looking Ahead

The future of healthcare staffing depends on better support, stronger trust, and fairer systems. Hospitals, agencies, and clinicians must work together to create workplaces that value well-being, transparency, and flexibility.

Now is the time to move beyond short-term fixes and start building staffing models that truly support those who care for others every day. Contact Talent4Health to build stronger staffing solutions, support your workforce, and create better outcomes for both clinicians and patients.