Ontario hospitals have spent an astonishing $9.2 billion over the past decade on for-profit staffing agencies to fill critical health care roles, according to a newly released report. The report, titled Hollowed Out: Ontario Public Hospitals and the Rise of Private Staffing Agencies, was commissioned by the Canadian Centre for Policy Alternatives and authored by political economist Andrew Longhurst of Simon Fraser University.
The analysis reveals that spending on temporary agency workers, including nurses, allied health professionals, and administrative support staff, nearly doubled between the fiscal years 2013-14 and 2022-23. Per capita spending on private staffing agencies rose from $21 to $41 during that period, while spending on publicly employed hospital staff grew far more modestly, from $604 to $641 per capita.
The surge in agency spending reflects a deeper issue within Ontario’s health care system. Hospitals and long-term care facilities often turn to these agencies when they cannot fully staff shifts with their own employees. Temporary workers allow essential services to continue during times of shortage, but they come at a steep cost. These agencies routinely charge hospitals up to three times the standard hourly rate for staff, significantly driving up operational costs.
According to the report, the increasing reliance on private agencies creates a destructive feedback loop. As hospitals turn to more expensive, short-term solutions to cover staffing gaps, they inadvertently undermine efforts to stabilize and grow their permanent workforce. This reliance contributes to chronic understaffing, long emergency room wait times, delayed surgeries, and the persistent problem of hallway medicine, where patients are treated in makeshift spaces due to a lack of proper accommodations.
The report points to fiscal austerity measures and stagnant hospital funding as major contributors to the crisis. As Ontario’s population grows and ages, demand on the health care system increases, but investments in long-term staffing solutions have not kept pace. The resulting instability makes public hospitals increasingly dependent on temporary staff, further exacerbating the cycle of under-resourcing.
Despite this troubling trend, some hospitals are working to reverse course. Markham Stouffville Hospital, part of the Oak Valley Health network, is actively working to reduce its reliance on agency nurses and aims to eliminate their use altogether by September. The hospital has implemented a range of recruitment and retention strategies to support this goal. These include offering additional training and support to newly graduated and internationally educated nurses, creating a flexible nursing resource team that can be deployed across different departments, organizing hiring events, and expanding its recruitment efforts.
The Ontario government has played a role by funding training programs for new nursing graduates and internationally trained nurses. Through the Nursing Graduate Guarantee program, employers receive 20 weeks of funding to help integrate these nurses into full-time roles. Since 2020, the initiative has facilitated the hiring of more than 3,300 nurses across the province.
Still, the financial incentive to work for private agencies continues to lure many nurses away from permanent hospital positions. Agency nurses often earn more than double the wages of their staff counterparts and enjoy greater autonomy over their schedules. This pay disparity further erodes morale among full-time hospital nurses, many of whom face heavier workloads and less flexibility while earning significantly less.
Other Canadian provinces have taken more aggressive action to address the problem. Quebec has enacted legislation to phase out the use of private staffing agencies in health care by 2026, though the law is currently being challenged in court. New Brunswick has introduced legislation aimed at canceling a travel nurse contract, prompting legal action from the agency involved. British Columbia has also signaled its intent to reduce its reliance on temporary agencies and rebuild a stable public health care workforce.
As Ontario grapples with its own staffing crisis, the findings of the report serve as a stark warning. Without significant policy intervention, the growing dependence on costly for-profit staffing solutions may continue to erode the province’s public hospital system, compromising both its financial sustainability and the quality of care patients receive.
News Source: CBC
Sana A. is a medical student, writer, and journalist with a strong passion for healthcare reporting and a deep commitment to covering current events across the United States. As a contributor to Los Angeles Headlines, she focuses specifically on medical news, health policy, and emerging trends in the healthcare industry.
