Senior Living Operators Seek To Control Staffing Costs As Wages Remain Top Turnover Driver 

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Staffing is the biggest line item on most senior living operating budgets. Operators have a few tools at their disposal to help cover these costs without it impacting their bottom line.

Wages for hourly staffers at Dallas, Texas-based Frontier Senior Living, jumped between 100% and 200% during the Covid pandemic. The company’s annual wage increases for hourly staff now range between 3% and 5% due to general stabilization, according to Director of Finance Madeline Noble Saxton.

Redding, California-based Northstar Senior Living currently faces wage increases of about 5% to 10% each year, according to Sean O’Malley, vice president of operations.

“The increases are not always applied uniformly across the organization,” O’Malley told Senior Housing News. “They are often targeted toward market, rural vs. urban, competition, fair market value, comp studies, positions where the community is experiencing turnover, overtime, agency utilization or difficulty recruiting.” 

Senior living operators have cited non-competitive wages as the top reason for workers to leave the senior living industry. According to a new study from Argentum and Activated Insights, 62.3% of respondents indicated pay as the main reason they would leave the industry, beating the impact of negative supervisor relationships, poor culture, inadequate work-life balance and a lack of growth opportunities.

Senior living wage increases have also surpassed private sector averages in recent years. Another report from Argentum studying wage increases between 2019 and 2024, showed frontline staff wages ranged from 28.1% for resident assistants to 49.2% for lead certified nurse aides, while the average private sector increase for the same time period was 24.4%.

Cost increases vary from community to community and state to state, but state regulations on labor have a direct impact for operators and become another expense to balance.

Keeping up with costs

Between 2025 and 2026, Waukesha, Wisconsin-based Capri Communities saw an average 3.8% increase for its care and nursing staff, according to President and Chief Financial Officer Kristin Ferge. Like other operators, the company raised resident rates to keep up with the rising expenses, but its leaders are looking at “creative solutions” to help reduce overtime, agency usage and turnover.

The company’s workers follow a four-day workweek but are paid for five. The costs of implementing the program were offset by a grant from the state of Wisconsin , and the results show a positive impact not just in key performance indicators, but in recruitment.

“When we look at the number of applicants for a position, the volumes went up tremendously,” Ferge said. “And not only the volumes, but also the quality of the candidate.”

Senior living operators can’t just pass the cost of staffing on to residents to pay for it, O’Malley said. Northstar utilizes care-level and ancillary-fee adjustments, scheduling, technology and other process improvements to maintain expense discipline. Annual rate increases for stabilized communities in the company’s portfolio range from 4% to 7%, which helps offset all of its expenses. Communities that are struggling with wage corrections, high insurance increases or below-market rates often exceed that rate, according to O’Malley.

“Larger, more significant increases require clear communication and careful consideration of affordability and resident impact,” O’Malley said.

Dallas-based Sonida (NYSE: SNDA) decreased staffing expenses to 40.4% of its total revenue in the second quarter of 2026, representing a record low for the portfolio, according to CEO Brandon Ribar.

To achieve that result, the company eliminated its usage of agency staff and reduced overtime labor costs. The company also used its proprietary SPIN operating platform to better identify staffing levels and balance them with resident needs.

“We’ve really been able to start to harness that information to manage just the overall number of hours, and then reinvest dollars into the wage profile,” Ribar told SHN. “Our goal is not to hold wages flat. Our goal is to make sure that we’re paying people who are doing a great job above market, and ultimately what that leads to is a more efficient number of hours that you need.”

Frontier partners with CoBridge, a nursing consulting business, to help with clinical planning and ensuring its staffing levels remain appropriate. Alongside resident rate increases, the operator’s leaders have analyzed its revenue structure and separated out tiers of care rather than having all inclusive assisted living and memory care. While it’s not a new practice, it helps offset the wage increases the staff necessary to hit state required staffing ratios.

“I’m making sure that we either have the right amount of revenue on the staff, basically coming from accurately assessing those residents for the appropriate level of care, and that our level of care structure, is going to appropriately cover that staff,” Noble Saxton said. “It’s not really a revenue generator. It’s really just to make sure that our residents are healthy.”

Wages and retention

While paying wage increases can be costly, turnover is more expensive, doubly so when considering the impact to occupancy and resident satisfaction. Noble Saxton added turnover also has an impact on lost time for training purposes and overtime for other staff to pick up the slack.  

Argentum’s “Perceptions of Careers in Senior Living” study revealed positive team culture, competitive pay and supportive supervisors to be the top three retention factors for staff to remain at a senior living community, with 82.9%, 77.9% and 74.4% of respondents noting them respectively.

What Frontier has implemented as a retention strategy and to slow employee turnover, particularly when new staff are just starting out, is a “team rewards” program. In it, new staff members can earn a 50-cent hourly wage increase within their first 90 days if they are hitting key performance targets, and another wage increase after six months. From there, annual wage increases are budgeted around 3%.

The program was rolled out last year, and nursing staff turnover has seen an estimated 80% turnover reduction since its inception.

For Capri Communities, its staff pay is around 20% higher in communities that are part of its four-for-five program due to the missing eight hours staff are still paid for. However, between the grant funding that got it started and the savings in higher retention, reduction in agency usage and lower overtime usage has helped it pay for itself.

Capri is using another grant to create a career path program it has dubbed “Capri University,” with the hopes of further encouraging staff retention. The goal is to have additional wage increases as an incentive for staff pursuing additional training.

“It’s trying to recognize that there are individuals who want to have caregiving be their career,” Ferge said. “They’re not looking to become a nurse or a management position. It’s how we continue to keep them engaged with Capri and continue their education, but recognizing caregiving is their appropriate career path.”

Northstar’s pay increases are seen as a temporary stopgap to aid in retention, with expense reductions through vendor contracts and rate increases used to help offset the cost. The operator also strives to identify and address the root cause of turnover problems, such as addressing scheduling and workload issues. The company also recognizes staff and provides regular feedback outside of annual reviews, better onboarding and access to management.

“A wage increase may improve retention only temporarily when the underlying reason for turnover is poor supervision, inconsistent scheduling, inadequate staffing, lack of recognition or burnout,” O’Malley said. “Compensation should be treated as one component of a broader employee-retention strategy. We generally focus on maintaining market-competitive pay.”

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