Social and economic changes in industrial societies during the past quarter-century encouraged organizations to develop greater flexibility in their employment systems in order to adapt to organizational restructuring and labour market shifts (Kallenberg 2003). During the 1990s this trend became evident in healthcare organizations. Before healthcare restructuring, employment in the acute hospital sector was more stable, with higher levels of full-time staff. However, in the downsizing era, employers favoured more flexible, contingent workforces (Zeytinoglu 1999). As healthcare systems evolved, staffing patterns became more chaotic and predicting staffing requirements more complex. Increased use of casual and part-time staff, overtime and agency nurses, as well as alterations in skills mix, masked vacancy counts and thus rendered this measurement of nursing demand increasingly difficult. This study explores flexible nurse staffing practices and demonstrates how data such as nurse vacancy statistics, considered in isolation from nurse utilization information, are inaccurate indicators of nursing demand and nurse shortage. It develops an algorithm that provides a standard methodology for improved monitoring and management of nurse utilization data and better quantification of vacancy statistics. Use of standard methodology promotes more accurate measurement of nurse utilization and shortage. Furthermore, it provides a solid base for improved nursing workforce planning, production and management.