Assessing managerial implications of agency nursing at government academic hospitals in the Gauteng Province

Abstract

This study explores the financial and managerial implications of utilizing agency nursing staff in South Africa, with a specific focus on government academic hospitals in Gauteng Province. The increasing reliance on agency (or temporary) nurses has raised critical concerns regarding cost efficiency, workforce management, and quality of care within the public healthcare sector. Guided by Agency Theory, the study employed a qualitative secondary research design through a systematic literature review. Academic and grey literature published between 2010 and 2025 were reviewed using the PRISMA framework to ensure rigor and transparency. Findings reveal that agency nursing imposes substantial direct and indirect financial costs on hospitals. Direct costs include substantial expenditure on agency nursing contracts, with the most comprehensive national estimate reporting R1.49 billion spent on nursing agency services by public health departments in the 2009/10 financial year, the latest period for which consolidated national data are available. Subsequent detailed national totals are not readily available in the public domain. Indirect costs stem from supervision demands, recruitment, orientation, and administrative burdens . Managerial challenges include accountability issues, reduced reliability, and increased oversight demands on nursing managers. Furthermore, the transient nature of agency staff undermines continuity of care, adherence to hospital protocols, and staff cohesion. Policy and governance frameworks across provinces remain inconsistent, with weak oversight and limited standardization of agency utilization practices. Interpreted through the constructs of Agency Theory, the findings highlight significant agency costs, information asymmetry between management and temporary staff, and goal divergence between hospitals and agency nurses. These dynamics collectively contribute to inefficiencies and strained managerial control. The study concludes that while agency nurses offer short-term staffing flexibility, their extensive financial and managerial implications necessitate stronger governance, improved v integration strategies, and a shift toward sustainable workforce planning in government academic hospitals. Definition of Terms Agency Nursing: The temporary employment of nurses through private staffing agencies to provide healthcare services in public hospitals, typically to fill gaps due to staff shortages or increased patient demand. Contract Nursing: Similar to agency nursing, it refers to nurses employed on a fixed???term contract, often directly by the hospital or through an agency, rather than as permanent staff. Temporary Nursing Staff: Nurses employed for a limited period to cover staff shortages, leave, or high patient volumes. Agency nurses are a common form of temporary staff. Agency Costs: The expenses incurred by principals (hospitals) to manage the relationship with agents (nurses), including monitoring costs, bonding, incentives, and residual losses due to misaligned goals or inconsistent performance. Information Asymmetry: A situation in which one party (e.g., the agency nurse) has more or better information about their actions, intentions, or performance than the other party (e.g., hospital management), potentially leading to inefficiencies or conflicts. Goal Divergence: The misalignment between the objectives of the principal (hospital management) and the agent (agency nurse), for example, cost minimization and quality care versus personal financial gain and flexible work hours. vi Critical Realism: A philosophical perspective that posits the existence of an objective reality independent of human perception but emphasizes that knowledge of this reality is socially and historically mediated. Interpretivism: An epistemological approach that emphasizes understanding social phenomena through the meanings, experiences, and perspectives of individuals, recognizing that knowledge is socially constructed. Systematic Literature Review: A research methodology that involves the structured and rigorous collection, appraisal, and synthesis of existing research on a specific topic to answer defined research questions. PRISMA (Preferred Reporting Items for Systematic Reviews and Meta???Analyses): An evidence-based set of guidelines and a flow diagram used to ensure transparency and rigor in conducting and reporting systematic reviews. Government Academic Hospital: A public hospital that provides tertiary-level healthcare services and serves as a teaching and training facility for medical and nursing students. Financial Implications: The direct and indirect costs associated with employing agency nurses, including agency fees, administrative costs, overtime, and costs associated with inconsistent care quality. Managerial Implications: The consequences for hospital management practices, including staffing strategies, oversight, resource allocation, and policy decision???making related to agency nursing. Gauteng Province: A province in South Africa where this study focuses, chosen due to its concentration of government academic hospitals and high reliance on agency nursing. Qualitative Data: Non-numerical information, such as policy documents, reports, and textual data, that provides insights into the experiences, perceptions, and contextual factors influencing agency nursing practices.