Despite the slowdown in the overall M&A market, deals are picking up in certain sectors. E-commerce is one. Professional sports is another. Staffing shortages in healthcare is presenting opportunities as well.

“I don’t think it’s a secret that nurses are in tremendous demand,” says Ropes & Gray partner Ryan Dahl. “They’re highly trained. There’s long lead times to train nurses. I mean you can’t just go out and find nurses the same way theoretically you can find a guy to deliver pizzas. In the businesses I’ve seen, nobody has found the silver bullet to solve the challenges of employee turnover.”

The U.S. Bureau of Labor Statistics projects 194,500 average annual openings for registered nurses between now and 2030. And its not just hospital systems that are feeling the pain. The rise of telehealth, home health, long-term care and rehabilitation, and outpatient care centers has placed a bigger burden on staffing demands.

Dahl says employers are offering higher wages and stronger benefit packages, but will that be enough? This is where PE-backed companies come in. Alto Healthcare Staffing was acquired by Littlejohn Capital earlier this year. The target focuses on travel and per diem healthcare providers, and says it has a workforce that is available to deploy to assist with long term gaps as well as crisis needs. Littlejohn is betting on robust M&A in this sector over the coming years.  Littlejohn is the family office of Angus C. Littlejohn Jr., co-founder of Littlejohn & Co.

It’s not just Littlejohn firm that sees this trend. Last December, MidOcean Partners bought GHR Healthcare from Platform Partners. At the time, MidOcean said it saw healthcare staffing “as a key thematic area” based labor on shortages and the rising demand for healthcare professionals.

What other ways are you seeing the healthcare industry coping with staffing shortages, and how will it translate to M&A opportunities? Let me know at [email protected]

– Demitri Diakantonis