AVMA to take pulse of veterinary economy

Economist says high prices stifle demand in some cases

January 13, 2014 (published)
By Jennifer Fiala

Within the next few days, 12,000 American Veterinary Medical Association (AVMA) members will be asked to complete an email survey about their employment.

Another random sample of veterinarians soon could be queried about their annual incomes or how many clients come through their practices.

The AVMA economics division, headed by economist Michael Dicks, plans to roll out several surveys this year. The feedback, he said, will guide the AVMA as it addresses the profession’s economic health by way of policies and objectives.

The data also is expected to feed three upcoming AVMA studies exploring workforce capacity, employment and economic elasticity within the profession, Dicks said.

He stressed that obtaining accurate, solid information is crucial.

“There’s a lot of data that hasn’t been collected systematically,” Dicks said, speaking Saturday before the AVMA House of Delegates in Chicago. “When we send a survey out, getting a 10 percent response rate doesn’t give us good data.

"When I read the financial information you give me and there’s a lot of zeros … I need to see some real numbers," he said, referring to veterinarians' tendency to estimate survey answers.  

Dicks hopes the information will help boost the profession’s economic viability, which has waned in recent years. Many U.S. practitioners say they struggle with declining patient visits coupled with competition from a growing number of new veterinarians entering the marketplace.

The profession's financial difficulties are aggravated by six-figure educational debt loads carried by most new graduates, whose starting salaries, in the range of $65,000 a year, are not commensurate.

Dicks acknowledged that numbers of new graduates “have been going up 4.4 percent” since 2005, which is above historic trends.

However, greater competition isn't as big of an issue as the fact that veterinarians are driving away business with high prices, he said.

“As prices go up, demand goes down. You’ve saturated demand ...,” Dicks said. “Because you raised the prices above trend … there’s a gap between how much you’re willing to provide” and what owners are willing to pay.

"Loss of demand is your biggest problem," he stressed. 

To get a handle on pricing thresholds in the United States, Dicks said plans are under way to study 12 fast-growing major metropolitan areas to identify consumer demand and the various factors impacting it.

Results gleaned from the surveys will be reported during the second-annual AVMA Workforce Summit, tentatively scheduled for October at the group’s headquarters near Chicago.

Dicks said he anticipates the summit will be open to the public.

Editor's note: The AVMA's Michael Dicks has stated that this article inaccurately reflects his presentation before the House of Delegates. However, we're not yet clear about what needs to be amended. When we know more, we'll make the necessary corrections. In the meantime, we've removed the article from our public news site but have kept it live internally given the discussion that's ongoing. 

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