How to Avoid Underemployment and Maximize Your Income as a Travel Nurse
Due to the temporary nature of travel nursing jobs, and the instability they sometimes exhibit, travel nurses are often at risk for underemployment. In fact, avoiding underemployment can prove to be a very difficult task. And frequent bouts of underemployment can have a serious negative impact on a travel nurse’s annual income. In this blog post, we’ll discuss “underemployment” as it relates to travel nursing and offer some recommendations for avoiding it and thereby maximizing your income.
Underemployment and travel healthcare
Underemployment is an economic term used to refer to a broad set of circumstances relating to employment. In the broadest sense, underemployment is, “an employment situation that is insufficient in some important way for the worker, relative to a standard.”
Difficulty Declaring Unemployment as a Travel Nurse
There are several circumstances to which this definition is applicable for travelers. First, travelers have a unique problem with respect to unemployment. That is, they typically have a hard time declaring unemployment because the nature of their work is temporary and requires travel. So when a contract ends, the nurse’s agency will almost always have another contract available for them. However, it may not be what the nurse wants or where the they want it to be.
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So the traveler will most likely decline an employment offer which will make it difficult for them to qualify for unemployment benefits. So technically, the traveler is neither employed or unemployed. The result is that the nurse will end up working less than they would like to work throughout the year. In a sense, this is a form of underemployment that is unique to temporary travel contract workers.
Low Unemployment Wages for Travel Nurses
Of course, travelers are often able to qualify for unemployment insurance benefits. However, they often find that the benefits are much lower than expected. This is because the benefits are based on their taxable wages which are typically much lower than usual due to all the tax-free stipends that are included in the pay package.
Frictional Unemployment
Once travelers find themselves in this situation, they may also experience delays in finding an assignment that meets their needs. These delays are often experienced even when the ideal job exists. This is due to the fact that travelers do not have access to adequate information on the travel nursing job market. This problem is related to “frictional unemployment”, which we previously discussed and offered solutions for.
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Forced to Take a Job
When travelers are unable to find the ideal job, they might be forced to accept assignments in lower skill sets with lower wages. For example, an experienced ICU nurse might be compelled to accept an assignment for a Step-Down-Unit that pays $2-$3 less per hour than ICU positions at the same hospital. This is another form of underemployment.
Cancelled Shifts for Travel Nurses
Finally, travelers are always at risk of having their shifts cancelled. Despite agency advertisements about “guaranteed hours”, it is very rare for 100% of the contracted hours to be guaranteed. Standard contract clauses maintain that the nurse can be called off up to 3 times during a 13 week period…sometimes less, sometimes more. We’ve previously discussed guaranteed hours and provided our tips on the subject.
How can travel nurses avoid underemployment?
Unfortunately, travelers are highly susceptible to underemployment. Fortunately, there are many steps they can take to avoid it and earn an excellent annual income. Below is our list of steps to consider.
Use PRN as a fallback option
PRN is a great option for travelers seeking to avoid underemployment. Some nurses maintain PRN status with their former permanent employers back at home. The advantages of this are familiarity with the facility, a stronger chance of landing the shifts you need when you need them, and a strengthened case for maintaining your tax home. On the downside, you’ll need return home in between assignments which could prove costly or impossible.
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Signing up for agency PRN in the area of your contract is another option. While this isn’t the most lucrative and stable option, it’s better than nothing and it can get you through when you’re in a bind. One important note on doing this: We recommend having the PRN agency provide you with a contract that stipulates a start date and an end for your PRN availability. Otherwise, you may run the risk of having the IRS deem your PRN employment as an indication of permanent work which could jeopardize your traveler tax status. This is HIGHLY unlikely, but possible nonetheless.
Start planning your next assignment early
Despite what you may have heard, it’s never too early to start planning your next assignment. Many travelers and recruiters will say that it’s pointless to start looking for your next assignment earlier than 4 weeks from the end of your current assignment. This simply isn’t true. Hospitals routinely release openings well in advance, especially for their winter and seasonal needs. Moreover, hospitals routinely know whether or not they’re going to have a need to keep your current position staffed after your contract is completed.
So, first try to make an early determination as to whether or not you’re interested in obtaining an extension contract at your current hospital. Also, immediately determine whether or not you’re interested in exploring options in new destinations. Waiting on this could cost you in the end. You may find that your current agency doesn’t have contracts in the new destination, or that there are other circumstances that may hold up your ability to get an assignment there in a timely manner.
Communicate with your recruiter and the hospital
Communication with your recruiter(s) is key to avoiding underemployment. You should let your recruiter know as early as possible about your future assignment plans and desires. Let them know about your interest in an extension at the facility. Extensions can sometimes be locked down quite early. Also, the hospital may hold off on releasing an opening that overlaps with your contract in a way that voids the possibility for you to extend if they know you’re interested in extending.
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You should even let your recruiter know immediately if you determine that you’re not interested in extending. They’ll love you for it. Knowing this gives them an opportunity to have the first shot at getting another candidate in your vacated position because they have inside information that the position will potentially be available when you leave. It will also light a fire under your recruiter’s feet to keep an eye out for your next assignment. Recruiters can sometimes rest on their laurels thinking that you’re going to extend.
Finally, don’t be afraid to inquire with your contacts at the hospital as to whether or not there is a possibility for you to extend if you’re interested. There is nothing preventing you from doing this and you’re often in the best position to get the answer.
Maintain licenses in employable states
It never hurts to have a fallback plan for when your desired locations don’t come through. Maintaining licenses in states that have a high demand for travelers is a great way to avoid underemployment. The best license to have is a Compact Nursing License. If you’re unable to attain one, then California, Texas, and Florida are the next best options. These states have large populations and therefore more hospitals and higher demand.
Stay on top of your compliance documents
Maintaining a great set of compliance documents will ensure that you’re never caught off guard. Having your documents ready to go can make be the difference in whether or not you get offered the job.
Avoid the firm compensation requirement pitfall
We’ve covered how maintaining firm compensation requirements can negatively effect a travel nurse’s annual income. To summarize, maintaining firm compensation requirements can reduce the number of weeks you work in a year. This can have a significant drag on annual income, especially if you are not otherwise working.
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For example, let’s say you pass on a contract because it pays $2 less per hour than your firm requirement. Then, you accept a contract that pays your firm requirement, only it starts 3 weeks later. You have essentially sacrificed 3 weeks worth of income to earn an additional $936 ($2/hour*468 hours in a contract). This is not a good trade, so be careful when maintaining firm compensation requirements.
Work extra shifts when you can
Working extra shifts when you can is a great way to earn additional income which can make up for unwanted gaps in employment later. You can work some extra shifts with the hospital you’re contracted with, or pick them up with a PRN agency. However, if you decide to work the extra shifts with your contracted hospital, be certain that your agency has some method of paying for your extra hours that makes it worth your while.
Work with more recruiters
Working with more recruiters is probably the single best way to avoid underemployment as a travel nurse. The more recruiters you work with, the more exposure you have to the travel nursing job market. This is because no one agency works with every hospital in any given area.
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You can use BluePipes to help you manage the increased paperwork and communication required to work with a larger number of recruiters. BluePipes allows you to control your own job application, resume, and skills checklist. These are all the documents that agencies need to get you submitted for an open assignment. Watch the video above to see how. BluePipes also provides a professional networking platform that allows you to connect and communicate with recruiters as well as display your availability on your profile. The best part is that this is all free for healthcare professionals!
Please let us know if you have any experiences or recommendations to share on this topic by posting in the comments section below.
