The Labor Supply Effects of Texas's Nurse Mandatory Overtime Ban: A Difference-in-Differences Analysis

Abstract

We examine the labor supply effects of Texas's 2009 nurse mandatory overtime ban using a difference-in-differences design comparing Texas nurses to nurses in control states (Arizona, Florida, Georgia, Louisiana, Oklahoma) that lacked similar regulations. Using American Community Survey PUMS data from 2007–2012 covering 37,801 nurse observations, we find no statistically significant effect on average weekly hours worked (DiD estimate: +0.08 hours, SE: 0.29). Both Texas and control states experienced similar declines in average hours over the study period (approximately 0.9–1.0 hours), consistent with parallel trends in the absence of differential policy effects. We find suggestive evidence of positive employment effects (+1.1 percentage points), consistent with hospitals hiring additional nurses to compensate for reduced overtime capacity. Heterogeneity analysis reveals larger (but statistically insignificant) positive effects among male nurses (+1.35 hours). Our null result on hours suggests either that mandatory overtime was not widespread before the ban, that hospitals substituted toward voluntary overtime, or that household surveys cannot distinguish between mandatory and voluntary overtime. These findings contribute to the literature on occupational regulation and healthcare workforce policy, informing ongoing debates about nurse working conditions and patient safety.