Hospital Labor Costs in 2025: The Average Is 48%. Your Peer Group Matters More.

By ShiftMed Team//Healthcare Staffing , Labor Strategy
The ShiftMed 2025 Healthcare Labor Cost Report sits on an executive's desk, showing hospital labor cost as a percentage of operating revenue across the 30 largest U.S. health systems in 2025.

Hospital labor cost as a percentage of operating revenue averaged 48% across 75 U.S. health systems in 2025. Integrated delivery networks averaged 36.9%. Academic medical centers averaged 50.2%. Our 2025 Healthcare Cost of Labor Report shows where systems landed and what the improvers changed.

What's Inside

  • Every large system, plotted. The 30 largest U.S. health systems by 2025 operating revenue, each measured against the 48% average.

  • Benchmarks by system type. Integrated delivery networks, for-profits, regional nonprofits, and academic medical centers each landed in a different place in 2025, and the gap between the top and bottom groups is wide enough to change how you frame a workforce case.

  • Year-over-year movement. Most comparable systems in the set lowered their labor cost ratio in 2025. The report shows the median improvement, names the ten systems that moved furthest in either direction, and quantifies each move in percentage points.

  • What the improvers changed. The systems that reduced their ratio pointed to the same lever in their own disclosures: less contract and temporary labor. One cut contract labor to roughly 2% of total labor spend. The report details the four levers behind the improvement.

  • Methodology, stated plainly: Labor cost is salaries and benefits as a share of total operating revenue, from each system's most recent 2025 disclosure.

Download the 2025 Healthcare Cost of Labor Report

The free report benchmarks the 30 largest U.S. health systems by 2025 operating revenue, drawn from ShiftMed's 75-system dataset. It shows where labor spend concentrates, how wide the spread runs between comparable systems, and what the lower-cost performers are doing differently.

3 Ways to Use The Report

1. Budget season. Move next year's labor target off carried-forward actuals and onto a defensible external benchmark, so it reflects what comparable systems are achieving.

2. Board and finance committee. Give directors a clear read on where you sit against named peers, and the movement that's realistic over four quarters.

3. Workforce strategy. Find out whether your premium and contract spend is a market condition or a design choice you can change.