How Much Are You Losing to Nurse Turnover? The Financial Impact of Unaddressed Student Debt

The Hidden Cost of Nurse Turnover

Nurse turnover is one of the most expensive challenges facing non-profit health systems today. While salary and workload are often cited as primary reasons for nurses leaving, one overlooked factor is student loan debt—and it’s costing hospitals millions.

The financial impact of turnover is staggering: replacing a single nurse costs between $37,000 and $58,000, with an average of $46,000 per nurse (NSI Nursing Solutions, 2023). These costs stem from:

• Recruitment and onboarding (job postings, background checks, interviews)
• Lost productivity (time needed for new hires to reach full efficiency)
• Overtime and temporary staffing costs (to cover vacancies)
• Patient care disruptions (lower patient satisfaction, safety concerns)

For hospitals with 20% annual turnover rates, a system employing 1,000 nurses could be losing $9.2 million per year in turnover costs alone. What’s driving nurses to leave—and how can hospital leaders stop the exodus?

The Role of Student Debt in Nurse Retention

Nurses enter the workforce with an average student debt of $50,000 to $100,000 (American Association of Colleges of Nursing, 2022). With wages not always keeping up with inflation and the cost of living, financial stress becomes a major burden.

A PeopleJoy white paper found that:

• 72% of nurses cite financial stress as a top concern.
• More than 60% say student loan debt impacts job satisfaction and career decisions.
• Hospitals offering student loan repayment assistance see 25% higher retention rates compared to those that do not.

Hospitals that fail to address student debt risk losing nurses to travel nurse agencies, for-profit hospitals, and private-sector healthcare roles that offer loan support.

Why Traditional Retention Strategies Aren’t Enough

Many health systems attempt to retain nurses with:

• Sign-on bonuses – Attract new hires but don’t retain existing staff.
• Higher salaries – Help, but don’t directly alleviate long-term debt.
• Wellness programs – Address workplace stress but not financial burdens.

Without targeted financial benefits, these efforts fall short.

How Student Loan Repayment Benefits Save Millions

Hospitals that invest in student loan assistance see:

1. Lower turnover rates – Nurses stay when employers help with debt.
2. Significant cost savings – For every nurse retained, hospitals save up to $46,000 in replacement costs.
3. Improved recruitment and job satisfaction – Debt relief makes a hospital more competitive in hiring.

What CNOs Can Do to Combat Turnover

To reduce nurse turnover and improve retention, hospital leaders should:

• Assess Nursing Staff Financial Stress – Conduct surveys to measure financial strain and loan burdens.
• Implement Student Loan Repayment Benefits – Programs like PeopleJoy help hospitals design cost-effective solutions.
• Educate Nurses on Public Service Loan Forgiveness (PSLF) – Many nurses qualify but don’t know how to apply.
• Advocate for Financial Wellness Benefits – Position student loan support as a strategic investment, not just an expense.

Investing in Loan Assistance Pays Off

Hospitals lose millions in turnover costs every year, but nurse retention strategies must evolve. Offering student loan repayment benefits isn’t just a perk—it’s a proven solution to reduce turnover, boost job satisfaction, and save money.

Want to learn how PeopleJoy can help your hospital implement student loan benefits? Contact us today.

Sources:

• NSI Nursing Solutions, 2023: Nurse Turnover Rates & Costs
• American Association of Colleges of Nursing, 2022: Nursing Student Debt Statistics
• PeopleJoy White Paper (2024): The Impact of Student Loan Forgiveness on Employee Retention