School of Business and Economics
Think Differently About DHB Multi-Employer
Collective Agreements
James Hogan
(Masters of Commerce Thesis)
Health Sector Labour Market Dynamics and Multi-Employer Collective Agreements
School of Business and Economics
You Know About MECAs
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You know the agreement terms and conditions
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Automatic salary band inflation adjustment
–
Automatic annual salary band increments for doctors and nurses
without performance review
–
Rigid junior doctor training runs requirement
You know the process
–
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Tripartite arrangement between DHBs, unions, Minister of Health
You know how they have affected your DHB.
–
There's nothing I can tell you about that.
Health Sector Labour Market Dynamics and Multi-Employer Collective Agreements
School of Business and Economics
Politics, Policy and the
Role of Evidence

How should DHBs conduct their Industrial Relations policy?
–
Recognise that Clinicians know best, and Clinical Leadership will
create the best health workforce that is “good” and “best”.
http://www.northlanddhb.org.nz/AboutUs/OurPeople/ClinicalLeadership.aspx)`
–
Nurses deserve better. They are the backbone of the health
sector. We should pay them more.
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=3589906)
–
A positive and profitable workplace is created through good
treatment for employees. A negative workplace culture flows from
the misalignment of employer and employee interests(Royal Australian College
of Physicians)
(http://www.google.co.nz/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&ved=0CCEQFjAA&url=http%3A%2F%2Fwww.racp.org.nz%
2Findex.cfm%3Fobjectid%3DE2F74DB8-95EE-6BC7-9E2C313D721B6F11&ei=MwoYVNEC6OziwLksICoDg&usg=AFQjCNGAwU0xn4WAkHLS_5L-Wp5EIbUdyw&bvm=bv.75097201,d.cGE&cad=rja)
–
Our best and brightest are leaving! Pay them more
(http://www.health.govt.nz/our-work/health-workforce/education-and-training/advanced-trainee-fellowship-atf-scheme)
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Its apt that two days out from a general election, I am talking about
politics.
But I want you to focus on Economics: verifiable, provable,
evidenced-based, policy-focused, real world analysis.
Health Sector Labour Market Dynamics and Multi-Employer Collective Agreements
School of Business and Economics
Little bit of labour market economic theory...
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
Point (A) is a Magic Point and I will tell you
why.
Point (B) is where the MECA agreements
have lead your DHBs:
–
You're employing fewer workers than you want to.
–
You're paying more for each worker than you should
be.
–
You can't get enough workers even if you want you.
Something is stopping you.
–
You are powerless to change the workforce terms
and conditions. They are set nationally.
“Professor Gorman says there are 582 accredited hospital training positions - enough for the 400 New Zealand medical graduates
expected to seek to fill them this year - but bottlenecks remain and need to be cleared.”
(http://www.radionz.co.nz/news/national/240482/foreign-doctors-demand-action-on-jobs)
Health Sector Labour Market Dynamics and Multi-Employer Collective Agreements
School of Business and Economics
Problems: The Evidence
Nursing to Medical
0.43
2008
0.42
2007
2011
0.41
Relative Prices (Nursing to Medical)
2010
2009
2012
0.4
0.39
0.38
2006
2005
0.37
0.36
0.35
2004
0.34
3
3.1
3.2
3.3
3.4
3.5
3.6
3.7
3.8
Relative Quantities (Nurses to Medical)
Health Sector Labour Market Dynamics and Multi-Employer Collective Agreements
3.9
4
School of Business and Economics
Problems: The Evidence
Allied Health
0.375
2008
2012
0.37
2011
Relative Prices (Allied Health to Medical)
0.365
2010
2009
0.36
2007
0.355
0.35
2005
0.345
0.34
0.335
2006
0.33
2004
0.325
1.4
1.45
1.5
1.55
1.6
1.65
1.7
1.75
Relative Quantities (Allied Health to Medical)
Health Sector Labour Market Dynamics and Multi-Employer Collective Agreements
1.8
1.85
School of Business and Economics
MECA Distortions:
Graduates Can't get Employed
Health Sector Labour Market Dynamics and Multi-Employer Collective Agreements
School of Business and Economics
MECA Distortions:
Overseas Attracted by Higher than Competitive Wages
Health Sector Labour Market Dynamics and Multi-Employer Collective Agreements
School of Business and Economics
Estimating the DHB Workforce
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Each workforce effects each other
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Change in Doctors effects how many nurses are needed.
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Change in Nurses effects how many support staff are needed
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Not all workforce are equal
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Change in Man/Admin depended on how many nurses/support staff are
needed.....
Doctors produce more “health sector output” per worker than nurses.
Nurses produce more “health sector output” than allied health workers in
secondary care providers
Allied health workers produce more “health sector output” then nurses in
tertiary providers
Not all health sector providers are equal:

Secondary Providers need more nurses: they are nursing constrained

Tertiary Providers have too many nurses: they are nursing over-endowed

Everybody needs more doctors: doctors are systemically scarce. Problem with the
System
Health Sector Labour Market Dynamics and Multi-Employer Collective Agreements
School of Business and Economics
Departing thoughts
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This is a VERY big topic
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This is your data
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There's a lot in my thesis – more than 30 mins. I've given you a very big overview
NOW
You made HWIP 7 years ago. And
its created a rich data set capable of
supporting the economic and forecasting modelling it was designed to do
These results are EVIDENCE BASED. Underlying all these numbers are individuals.
Because this is YOUR DATA it shouldn't come as a surprise to you, that these are the
results: it would be more surprising if these results were a surprises.
Strategic Workforce Planning

Www.wiltshirehogan.co.nz Is a website created for scenario modelling . I'm happy to
spend more time explaining this website more.
Health Sector Labour Market Dynamics and Multi-Employer Collective Agreements