Veterinary Industry Trends: What You Should Expect In 2022

You’ve heard of Blockbuster video, right? If so, then you’ll be familiar with how they went from the world leader in video rentals to bust in a few short years.

But how did such a calamity happen? It happened because they failed to pay attention to market trends.

In these tumultuous times, it has never been more important to ‘skate to where the puck is going’ when it comes to veterinary trends. Doing so might help you avoid some pain and capitalize on opportunities.

In this article, we explore the biggest veterinary industry trends of 2022 and examine how much of a risk they pose for you and your team.

The Veterinary Industry Trends of 2022

Burnout: Will We Ever Beat It?

Over the last year, burnout rates have increased among veterinary professionals- especially in younger vets [1].

Fueled by increased client demands, stress, uncertainty, and reduced resilience, this problem is set to continue.

With many clinics being unable to function at full capacity due to staff absenteeism, businesses have been working overtime to keep up. This has increased wait times, stress levels, work volume, and staff turnover. Cumulatively, a perfect storm.

What is the Cost of This?

Burnout takes a physical and psychological toll on vets. But the economic implications can be just as severe.

According to Dr. Clinton Neill, an assistant professor at Cornell, accumulatively, the cost of posting job ads, providing training, giving bonuses, etc, is costing the veterinary profession more than a billion dollars per year.

So, Will Burnout Rates Improve in 2022?

It’s going to take time for practices to work at full capacity again, so it’s likely that these rates will persist well into 2022 (and quite probably beyond). The biggest problem is that supply cannot meet demand, and catching up is a slow game. Innovation in technology could, in theory, help, but chronic staff shortages are severe. Depressing as it may be, staff retention will not improve unless practices begin working on their culture. Practices that do so will thrive. Those who do not will suffer. Currently, we are seeing significant changes in the veterinary sector. Wages are rising, and so is flexible working [2][3].

Only time will tell if these strategies work.

Risk score 8/10

Covid Disruption

Though many hoped that the covid-saga would be over by now, unfortunately, this has not happened.

With the emergence of the Omicron variant, many countries are facing a number of fresh restrictions which may impact clinical operations.

In the UK, for example, office workers are now being encouraged to work remotely, with more restrictions potentially on the horizon. In the US, we hear that many veterinary teams are being hit as staff absences are on the rise.

So How Might Covid Impact the Veterinary Profession in 2022?

It’s a nailed-on-certainty that there will be further variants of concern hereafter, and governments will continue to deploy reactive mitigations as a result.

In all likelihood, social distancing measures will impede practice productivity, exacerbating existing backlogs, and hence burnout rates. In countries such as America and New Zealand, vaccine mandates could further disrupt services or cause conflict between colleagues [4][5].

While we expect 2022 to be less disruptive than previous years, the world is different.. What we consider ‘business as normal’ has changed, and it will open doors for new ways of working.

Risk score 6/10

Educational Debt

Student debt remains a big problem in 2022.

At present, student debt is growing at 4.5 times the rate wages are in the US. For perspective, this is an income to debt ratio of 2:1. Over the last twenty years, the average veterinary debt has tripled in sum, with most students leaving school owing nearly $160,000.

So What Does This Mean for the Future of the Profession?

In the long run, we may see lower application rates for vet schools as alternative career paths appear more lucrative. The return on investment for a veterinary degree, when compared to medicine, law, or dental equivalents, is not great. The bad press surrounding veterinary suicide and burnout doesn’t help either. Unless corrective action is taken to control the cost of education, it’s hard to see how the profession will flourish. The debt issue is also a massive problem for inclusion, as the price tag effectively makes vet medicine the preserve of the privileged (white) few.

Risk score 6/10 – increasing the longer the situation persists

Inflation

The world economy has been battered by covid. Ongoing absenteeism is wreaking havoc on supply chains, and there are few companies not experiencing disruption. This has introduced scarcity, which is driving up prices. Add in escalating wages and higher energy costs, and you have the ingredients for inflationary pressure. In the US, for instance, year-on-year inflation rates have reached their highest levels in over three decades. Similar trends can be observed elsewhere.

But so what? Central banks can increase interest rates to deal with that, can’t they?

Well, not quite. For over a decade, western countries have been printing money (quantitative easing) and building growth based on credit splurging. The average family has debt coming out of their ears. Mortgage, credit cards, personal loans, and medical debt.

Stimulus checks have helped maintain liquidity during covid, but these checks have run out for now and government debt has soared. The result? Increasing interest rates that could put families across the country at risk of being unable to make debt payments.

In other words, there is very little room for policymakers to take action that doesn’t have serious downside risk. The US Fed predicts upward pressure on prices for the first three quarters of 2022 with a drop back to something closer to target at the end of the year. The mechanism of how this will happen is not entirely clear.

But What Does This Mean for Veterinary Businesses?

With inflation set to peak at about 7% in the UK and US by spring, business expenses will go up. In turn, increased costs in living may impact wage expectations, putting on more pressure.

Hopefully, if the Fed boffins are right, inflation rates will drop. But with some practices putting up fees aggressively already, it seems like some pet owners could be forced out of the market- which is pretty significant seeing as one-third of pet owners can’t afford care as it is [6].

Inflation will also affect pet owners' family budgets which will inevitably drive up rates of pet abandonment. So will the pandemic puppy rush even out, eating into the economic gains made during the pandemic? [7][8]

Savvy clinics will need to effect price raises more frequently to avoid margin erosion. While monitoring the impact on client churn.

But veterinary medicine has continually proven to be highly resilient to financial disasters, and it’s likely this will continue to be the case. After all, pets are generally not seen as a luxury, but as family nowadays. Whether the pandemic has genuinely strengthened this bond we are going to find out.

Risk score 6/10

Telemedicine

Telemedicine got a lot of attention in 2021, but will 2022 be as prosperous?

At the start of the pandemic when regulatory bodies relaxed remote prescription restrictions, investment in telemedicine technologies soared. But after a couple of months of social distancing, there was pushback.

Under normal circumstances taking a full history and physically examining a patient is a prerequisite to diagnosis and treatment. Without these measures, it is argued, patients are potentially at risk.

The UK and California are two locations that are clearly twitchy about the long term and have announced plans to reintroduce telemedicine restrictions, with several other regions set to follow. But just to demonstrate just how uncertain vet lawmakers are about this technology, the UK’s Royal College of Veterinary Medicine has since changed its mind and extended the use of remote prescribing – likely a temporary response to Omicron.

What Does This Mean for the Future of Telemedicine?

Though many countries have pulled back on telemedicine, there are some regions (such as Florida) that are looking to relax restrictions permanently.

This is due to, in part, a strong tailwind of wealthy backers who want to see veterinary medicine further deregulated. And it’s clearly also seen as part of the solution to the shortage of clinical talent.

But the great risk, and hence resistor of change, is that it opens the way for corner-cutting; illustrated by the calls to remove face-to-face consultation and examination altogether. Folly in the view of many vets.

There are clearly instances where telehealth has shone. Secondary specialty support services, education, and marketing (pre- and post-visit) are brilliant uses of these technologies that are unquestionably improvements.

Our prediction is that there is a regulatory showdown that will come to a head. From the flame and ash, a new technologically enabled future will emerge- one that will serve pet owners' needs as they demand it. The market demand will lead and the profession will, in the end, follow.

Expect large well-financed corporations (like Chewie, Banfield, and many others) to aggressively drive client acquisition via tele-advice offerings. They’ll be bundled into subscription products and create a significant amount of revenue or loyalty. We believe practices need to get organized fast and work with a platform that will allow them to compete with such national corporations or risk losing new business without knowing what happened. We also predict that GPOs and other private providers will invest in these platforms to allow private vets the opportunity to compete [9][10][11].

Risk score 7/10

Recruitment & Retention

2021 was a great year for job hunters, but a terrible year for employers.

Though job growth is projected to continue to grow well into 2022, supply is unlikely to meet demand [12]. As mentioned prior, the compounded effects of pay, stress, and the pandemic (and if you’re in the UK, Brexit) have created a perfect storm for employers.

Practices in the US, UK, Australia, and New Zealand have all seen severe worker shortages. In the UK, for example, veterinary surgeon positions are currently the hardest job to fill on Indeed.com (the world’s busiest employment website) [13].

What Tangible Action Might We See in 2022 to Address the Recruitment Crisis?

Something that we’ve seen during 2021 and will continue to see in 2022 is a push for more vet students.

And though there is a need for more vets (especially in rural areas), this strategy is unlikely to make a real dent in the problem. Like filling a leaky bucket, pushing more graduates through the education system does not address the underlying drivers. Nor does it offer a quick fix.

Given that it’s going to take time for practices to get through existing backlogs (especially if the new variant throws a spanner in the works), burnout rates will persist and the demand for vets may intensify.

The market has also changed significantly. More vets than ever want to reduce their hours or work as relief vets (locums). This will realistically have an impact on supply and demand.

At the core of all this is the professional need to be available for pet owners vs. the veterinarian’s desire for work-life balance. Expect ongoing market fragmentation as practice owners realize that being a jack of all trades is a recipe for burnout.

Risk score 9/10

The Takeaway

2022 will bring some great challenges but don’t despair.

Forward planning, flexible employment options, tech, and fixed-cost model changes could all present opportunities for growth.

But if the past has taught us anything, it is that there seriously needs to be better leadership and culture within the veterinary community. Veterinary medicine remains an attractive option for owners with strong demand both for employment and services.

Agile leaders who take time to assess risk and align their practices strategically will do very well. Those who do not, are in for a bumpy ride.

For help navigating the bumpy ride, why not join my veterinary Leadership course. Gain access to weekly coaching and Q&A sessions, our helpful Leaders community, and 14 hours of on-demand continuing education. Sign up here.

References:

1- ‘Burnout and Work-Life Balance Study in the Veterinary Profession.’ 10 Nov. 2021, https://vetintegrations.com/insights/burnout-2021. Accessed 13 Dec. 2021.

2- ‘Getting to the root of overworked and burned-out veterinary practices.’ 17 Nov. 2021, https://www.avma.org/javma-news/2021-12-01/getting-root-overworked-and-burned-out-veterinary-practices. Accessed 13 Dec. 2021.

3- ‘Burnout’s economic toll on veterinarians calculated – American ….’ 8 Dec. 2021, https://www.avma.org/javma-news/2021-12-15/burnouts-economic-toll-veterinarians-calculated. Accessed 13 Dec. 2021.

4- ‘What you need to know about the employer vaccine mandate.’ 8 Dec. 2021, https://www.avma.org/what-you-need-know-about-employer-vaccine-mandate. Accessed 13 Dec. 2021.

5- ‘Omicron: what do we know about the new Covid variant?.’ 6 Dec. 2021, https://www.theguardian.com/world/2021/dec/05/omicron-what-do-we-know-about-the-new-covid-variant. Accessed 13 Dec. 2021.

6- ‘Most Americans Have Pets. Almost One Third Can’t Afford Their Vet.’ 12 Nov. 2021, https://talkpoverty.org/2021/11/12/low-income-veterinary-care-affordability/. Accessed 13 Jan. 2022.

7- ‘The US may be stuck with higher inflation in 2022, and potentially ….’ 25 Nov. 2021, https://blogs.lse.ac.uk/usappblog/2021/11/25/the-us-may-be-stuck-with-higher-inflation-in-2022-and-potentially-beyond/. Accessed 5 Jan. 2022.

8- ‘Will inflation in the UK keep rising? | Bank of England.’ https://www.bankofengland.co.uk/knowledgebank/will-inflation-in-the-uk-keep-rising. Accessed 5 Jan. 2022.

9- ‘UK veterinarians challenge ongoing embrace of telemedicine – News.’ 19 Oct. 2020, https://news.vin.com/default.aspx?pid=210&Id=9853067. Accessed 13 Dec. 2021.

10- ‘Veterinary telemedicine restrictions make a comeback – News – VIN.’ 17 Nov. 2021, https://news.vin.com/default.aspx?pid=210&catId=614&Id=10586727. Accessed 13 Dec. 2021.

11- ‘Global Pandemic impact on the veterinary market.’ 22 Jan. 2021, https://www.canadianveterinarians.net/documents/vet-survey-2020-part-1-covid-19-global-pandemic-impact-on-vet-market. Accessed 13 Dec. 2021.

12- ‘Veterinarians | Data USA.’ https://datausa.io/profile/soc/veterinarians. Accessed 13 Dec. 2021.

13- ‘On the job hunt: These are the hardest vacant roles to fill in the UK.’ 30 Nov. 2021, https://www.cityam.com/on-the-job-hunt-indeed-reveals-the-hardest-vacant-roles-to-fill-in-the-uk/. Accessed 13 Dec. 2021.