This document discusses productivity trends in the NHS from 2003/12. It finds that while aggregate workforce spending has increased, it now forms a smaller proportion of total expenditure. This is due to a rise in medical staff numbers outpacing nursing staff. Productivity has remained largely unchanged according to ONS measures but some acute trusts have achieved gains through better cost control. The document identifies factors correlated with variations in trust-level productivity.

1. Productivity across the NHS
Anita Charlesworth
05 December 2012 © Nuffield Trust

2. While aggregate spend on workforce has increased,
it now forms a smaller proportion of total expenditure
50.0 100%
45.0 90%
Proportion of total PCT operating expenditure on
Real aggregate workforce spend (£bns)
40.0 80%
35.0 70%
56% 56%
workforce (%)
30.0 56% 55% 60%
52% 54%
52% 51% 51%
25.0 50%
20.0 40%
15.0 30%
10.0 20%
5.0 10%
0.0 0%
2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12
© Nuffield Trust

3. This change in expenditure can be broken down into
numbers of staff and expenditure per employee
50.0
48.0
Real aggregate workforce spend (£bns)
46.0
44.0
42.0
40.0
38.0
36.0
34.0
32.0
30.0
© Nuffield Trust

4. There are now fewer nurses per medical staff
member, mainly due to an increase in the latter
6.0 1.40
Number of Nursing, Midwifery and Health Visiting
Staff (inc Learners) per Medical and Dental Staff
Indexed number of medical/nursing staff (1.00 =
1.20
5.0
1.00
4.0
0.80
2003/04)
Member
3.0
0.60
2.0
0.40
1.0
0.20
0.0 0.00
2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12
Medical and Dental Staff Nursing, Midwifery and Health Visiting Staff National
© Nuffield Trust

5. There has also been a far more rapid increase in
Healthcare Assistants since 2007/08
4.0 1.60
Indexed number of nursing/healthcare assistant staff
Staff (inc Learners) per Healthcare Assistants and
Number of Nursing, Midwifery and Health Visiting
3.5 1.40
3.0 1.20
Other Support Staff Member
2.5 1.00
(1.00 = 2003/04)
2.0 0.80
1.5 0.60
1.0 0.40
0.5 0.20
0.0 0.00
2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12
Nursing, Midwifery and Health Visiting Staff Healthcare Assistants and Other Support Staff National
© Nuffield Trust

6. Our productivity measure for each trust was based on the
Office of National Statistics’ whole economy index
Productivity measure Measures of Output Measures of Input
Nuffield Trust Cost weighted activity Labour cost
including acute and
By acute provider community service
episodes and
attendances
Office of National Measures above plus: Measures above plus:
Statistics
Family health service Goods and service
Whole economy consultations costs
GP prescribing Capital consumption
Quality weighting
© Nuffield Trust

7. The ONS estimates that productivity has remained
essentially unchanged over the last four years
1.20
1.10
1.00
Productivity index
0.90
0.80
0.70
0.60
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Output index Input index Productivity index
© Nuffield Trust

8. Better labour cost control in acute trusts leads to
greater gains in productivity in our measure
1.20
1.10
1.00
Productivity index
0.90
0.80
0.70
0.60
2006/07 2007/08 2008/09 2009/10 2010/11
Output index Input index Productivity index
© Nuffield Trust

9. While productivity outliers have been brought towards
the average, half of trusts are still in a range of 20%
1.80
1.60
Productivity by Trust (NHST or FT)
1.40
1.20
1.00
0.80
0.60
0.40
0.20
0.00
2006/07 2007/08 2008/09 2009/10 2010/11
Min-Max 10%-90% Lower-Upper Quartile Mean
© Nuffield Trust

10. Our econometric modelling was able to explain 35% of
variation in productivity at a trust level
Statistically significant drivers of Tested but no effect found
productivity
Follow-ups per first outpatient appointment Better care, better value indicators other
(-ve) than first to follow-up ratio
Located in London (-ve) Index of multiple deprivation
Foundation trust status (+ve) Other geographic locations than London
Herfindahl–Hirschman index (i.e.
competition between providers) (+ve)
Staff mix (proportion of employees who are
medical or dental staff) (+ve)
Proportion of revenue from education,
training and research (-ve)
Trust size (described as number of beds
available overnight) (-ve)
© Nuffield Trust

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05 December 2012 © Nuffield Trust