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PURPOSE This study aimed to analyze the impact of increasing the supply of newly licensed nurses on improving the hospital nurse staffing grades for the period of 2009~2014. METHODS Using public administrative data, we analyzed the effect of newly licensed nurses on staffing in 1,594 hospitals using Generalized Estimating Equation (GEE) ordered logistic regression, and of supply variation on improving staffing grades in 1,042 hospitals using GEE logistic regression. RESULTS An increase of one newly licensed nurse per 100 beds in general units had significantly lower odds of improving staffing grades (grades 6~0 vs. 7) (odds ratio=0.95, p=.005). The supply of newly licensed nurses increased by 32% from 2009 to 2014, and proportion of hospitals whose staffing grade had improved, not changed, and worsened was 19.1%, 70.1%, and 10.8% respectively. Compared to 2009, the supply variation of newly licensed nurses in 2014 was not significantly related to the increased odds of improving staffing grades in the region (OR=1.02, p=.870). CONCLUSION To achieve a balance in the regional supply and demand for hospital nurses, compliance with nurse staffing legislation and revisions in the nursing fee differentiation policy are needed. Rather than relying on increasing nurse supply, retention policies for new graduate nurses are required to build and sustain competent nurse workforce in the future.