December 15, 2019

Nearly 20% of veterinarians are anticipated to retire in the next decade.

The number of veterinarians has been increasing by about 2.2% every year for a decade, but will that growth be enough to meet demand? And is increasing the number of graduates the solution, or is there another way to address veterinarian shortages, especially those happening right now?

Frederic B. Ouedraogo, PhD, assistant director of economics in the AVMA Veterinary Economics Division, discussed the market for veterinary services, including the demand for services and practice economics, during the AVMA Economic Summit, held Oct. 22-23 in Rosemont, Illinois.

Shortage or mismatch?

The AVMA Veterinary Economics Division conducted an analysis of the AVMA membership database that identified 113,394 veterinarians living in the United States in 2018. Currently, one out of three veterinarians is a baby boomer, and 60% of these baby boomers are practice owners.

“If we look at the future of our profession and assume that in five to 10 years, half of those boomers and the rest of the silent generation retire, that’s 20,000 people leaving the workforce, and those are our most experienced workers, and many own their practice,” Dr. Ouedraogo said. “This will have an impact on the way we’re doing business.”

This year alone, the Department of Agriculture identified 197 areas considered to have a shortage of veterinarians. In the AVMA analysis, Delaware and West Virginia were among the states that were identified with shortages of veterinarians, with the highest ratio of housing units to veterinarian—between 2,000 and 3,000 housing units for each veterinarian.

Nationwide, the mean monthly number of searchable jobs on the AVMA Veterinary Career Center this year has been more than five times the mean monthly number of new job seekers (see story).

That disparity is happening despite the profession consistently growing, as more and more veterinarians graduate. The 2.2% growth rate of veterinarians per year may accelerate further as more veterinary colleges open up, including the University of Arizona and Long Island University, which each received a letter of reasonable assurance from the AVMA Council on Education this fall (see JAVMA, Dec. 1, 2019, Second New York veterinary college moves foward with COE approval and Arizona cleared to proceed with veterinary college). In addition, class sizes are growing. Bridgette Bain, PhD, associate director of analytics in the AVMA Veterinary Economics Division, estimates the graduating class of 2029 from U.S. veterinary colleges will have 4,000 people, compared with around 3,200 currently.

But increasing the number of seats in veterinary schools may not be the solution, Dr. Ouedraogo said. 

“What is happening in the veterinary profession might not be a shortage but a mismatch in price,” he said in reference to the price that practices are willing to pay for veterinarians’ salaries. “We probably need to think about this aspect and solutions that affect price.”

Showing value

As the number of veterinarians continue to increase, so do the number of practices. Between 2005-16, the number increased 14% to an estimated 31,205 clinics. That’s an annual growth rate of 1.2%, or 400 clinics per year. At that rate, the number of practices will increase to around 40,000 by 2030, Dr. Ouedraogo estimated.

The states that have seen the biggest percentage increase were North Dakota at 22.5%, followed by Florida at 15.8%, North Carolina at 13.9%, and Arizona at 13.7%.

At the same time, how practices are staffed hasn’t changed much over the past five years. Companion animal practices have, on average, two veterinarians per practice with three to five veterinary technicians. The number of nonmedical personnel is around three per practice on average.

When looking at the efficiency of practices, a measure of how well practice resources are being used, the AVMA found that, on one end of the spectrum, 14% of veterinary practices are operating at 100% efficiency, while on the other end, 10% of practices are inefficient, operating at 20%-40% efficiency.

Notably, all responding practices with more than six full-time–equivalent doctors operated at 100% efficiency, compared with only a third of practices with fewer than two FTE doctors.

The AVMA found that a factor in practice revenue was the ratio of veterinarians to nonveterinarians.

Results from the 2018 AVMA Capacity Survey, which was sent to a random sample of 16,000 AVMA members, with a 16% response rate, indicate that the ratio of veterinarians to nonveterinarians was around 1:4 for companion animal practices, 1:2.5 for equine practices, and 1:2.8 for mixed animal practices in 2018. The summary statistics indicate that for companion animal practices, the ratio of veterinarians to certified veterinary technicians was about 1:0.6 for companion animal practices and 1:0.4 for both mixed animal and equine practices.

Dr. Ouedraogo researched the marginal contribution to practice revenue by type of position and found that, on average, bringing in another veterinary technician resulted in an 18.3% increase in practice revenue, whereas bringing in another veterinarian meant an average increase of 6.3% in practice revenue. A ratio of four certified veterinary technicians per veterinarian—or six noncredentialed veterinary technicians—is when the practice’s revenue reaches its maximum potential.