Estia in fight for nursing staff with rival health providers

Estia has slashed its use of casual staff in an effort to attract talent amid Australia’s chronic nurse shortage.

In total, Australia needs another 85,000 nurses by 2025, according to the commonwealth.

Estia has slashed its use of casual staff as the nursing home operator jostles with the big hospital groups to attract talent amid intense competition for staff.

After the aged care sector attracted criticism early in the pandemic over the use of casual employees and the rampant spread of Covid-19, Estia has slashed its use of transient staff to six per cent of total hours worked.

But the company’s chief executive, Ian Thorley, said converting more staff from casual to permanent was more about Estia – which has more than 6000 beds in 69 homes – attracting and retaining talent as Australia battles a chronic nurse shortage.

In total, Australia needs another 85,000 nurses by 2025, according to the commonwealth. It’s a crisis that is expected to worsen across nursing homes after the aged care royal commission recommended that from July each resident should have at least 40 minutes of care a day from a registered nurse.

Mr Thorley said slashing the use of casual nurses strengthened the company’s employee value proposition.

“We think that‘s a really important strategy giving people whole jobs rather than fractionalised jobs,” Mr Thorley said.

“It’s a little bit like Ramsay has done. They are a fantastic organisation and they attract the best workers because of the company they are. So that’s one of our ambitions as well.”

Ramsay, Australia’s biggest private hospital operator, is recruiting 550 graduate nurses this month – its highest intake ever – in effort to combat chronic labour shortages.

The battle for nurses comes as Estia deepened its half-year loss from $5.58m to $8.1m in the six months to December 31. But Mr Thorley said the Omicron outbreak was stabilising across its nursing homes.

Estia Health CEO and managing director executive director Ian Thorley says it’s better to give ‘people whole jobs rather than fractionalised jobs’.

The company’s shares rose more than 3.4 per cent to $2.12.

The group‘s revenue firmed 3.1 per cent to $342.5m as the pandemic began to abate during December. But Mr Thorley said when Omicron struck in January, it quickly spread, infecting more than 70 per cent of Australia’s nursing homes.

“Although many Estia Health homes were impacted, resident vaccination programs resulted in a lower severity of illness, swifter recovery periods and lower mortality rates than seen with previous variants,” Mr Thorley said.

“I would like to extend my condolences to the families of those residents who have died during the pandemic.

“As of 21 February 2022, the group is seeing a stabilisation, with the number of homes directly impacted by an outbreak having fallen significantly and with that, a corresponding reduction in employee and resident cases. I am confident Estia is emerging from this phase of the pandemic as a stronger organisation, well-placed to succeed in a reformed sector and benefit from the favourable demographics of an ageing Australian population and the need for residential care.“

Jarden analyst Matt Johnston said: “Our thesis doesn‘t change post (first half) results and

believe the recovery thematic is intact.

“Estia is in a recovery from Covid and from an oversupply and funding cuts. We believe there are positives investors need to focus on and its strong balance sheet.”

Estia will pay an interim dividend of 2.35c, fully franked, a share on March 18.