Sparrow Health System laying off hundreds of employees

Sparrow Health System and a top union official confirmed Thursday that the hospital system will lay off hundreds of employees.

Professional Employee Council of Sparrow Hospital — Michigan Nurses Association Vice President Kevin Glaza said in an email to the State Journal that Sparrow officials notified the union its members will be affected by job cuts.

"PECSH-MNA has been informed of hundreds of job cuts being rolled out across Sparrow Health System. Some of these cuts will affect the (union), which represents about 2,200 registered nurses and health care professionals," Glaza wrote.

Sparrow spokesperson Corey Alexander confirmed the layoffs late Thursday afternoon in an email, and said the job cuts would impact "several hundred roles." Most reductions, he wrote, will target leadership and non-patient care roles. Some clinical jobs will be affected, but in places with low patient volumes.

According to Sparrow's job board, there are 255 open positions, and many of the postings are for clinical and physician practice staff.

Health care layoffs in Metro Detroit:Beaumont-Spectrum health system lays off 400 employees

Alexander in his statement said the health system had a net loss of $90 million in the first six months of this year as supplies, salaries, wages and benefits rose, but patient volumes declined and "cost of contracting agency labor has skyrocketed."

"Salaries, wages, and benefits have increased 35% compared to 2019 due to the nationwide labor shortages that have created staffing challenges," he said. "These shortages have resulted in increased use of agency nurses to meet the needs of our patients. Our cost of contracted labor in fiscal year 2022 is projected to be $50 million."

Alexander declined comment beyond the health system's statement.

"Sparrow will adapt to this changing world and will do so quickly," he wrote. "We will fundamentally change how we operate our business and how we are structured so that we are positioned to serve our community for another 126 years."

Glaza said he's concerned about the effect layoffs will have on patient care and the community and said the union will work to alleviate impacts on patient safety.

"We are using the rights we have as a union to try to mitigate the potential consequences to patient safety as much as possible," he wrote.

Denny Martin, interim president of E.W. Sparrow Hospital, confirmed earlier this month Sparrow Hospital has a staffing shortage that's put a strain on its emergency department.

The Michigan Health and Hospital Association reported on Sept. 6 that 11,000 fewer people are in health care altogether.

The health care field has been changing in recent years. Sparrow Health spokesman John Foren said in June last year the health system had "about 280 travelers," or traveling nurses, in every area of the health system. Many nurses around the country switched to traveling nurses to cover rising personal expenses and to care for various parts of the country throughout the year.

Sparrow is not alone in job cuts. Beaumont-Spectrum Health System officials said on Sept. 9 they were laying off 400 employees in management and non-patient-facing jobs for financial reasons.

There also has been growing dissatisfaction for health care workers because of the pandemic.Nurse Tracy Farthing, who also serves as the emergency services and critical care director at Sparrow Emergency Center Okemos, said earlier this month working in hospitals used to be appealing, but the pandemic revealed the difficulty of those jobs and people left for other agencies or health care altogether.

Earlier in September, Sparrow opened its new $20 million emergency center in Okemos. Dr. Kent Yaney, director of the center, has said is fully staffed.

The project is part of the system's six-year $800 million investment plan to improve care at facilities, increase the footprint and expand its presence beyond Lansing. Still to be completed is a $40 million outpatient surgery center in downtown Lansing, a $350 million five-story tower with patient rooms at Sparrow Hospital and a $50 million expansion of outpatient offices in Greater Lansing.

It wasn't clear Thursday what impact Sparrow's losses during the first half of the year will have on that plan.

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Contact reporter Krystal Nurse at (517) 267-1344 or knurse@lsj.com. Follow her on Twitter @KrystalRNurse.

This article originally appeared on Lansing State Journal: Sparrow Health System in Lansing laying off hundreds of employees