Finally, Some Actual Trends!
It has been very difficult over the past year or so to see real trends in veterinary medicine and to predict what’s going to happen next. But finally, things seem to be settling down a little.
Shown below is revenue, patient visit, and new client growth data over the last seven months compared to the same months in 2020. What does this tell us?
- March and April numbers look crazy and actually don’t tell us much because these showed growth in two very busy months in 2021 compared to two very slow months in 2020
- May is a bit of a transition month; practices were starting to recover in 2020 so again, no perfect comparison from 2021 to 2020
- Starting in June, however, we start to see more consistency, in spite of a little blip in August:
o Revenue growth is reasonably strong but not the crazy growth seen in 2020; these numbers are similar to what we saw pre-pandemic in 2019. Remember, though, that for many practices, the 2021 growth is on top of a higher base in 2020, which = increased busyness.
o Patient visit growth is also similar to 2019 growth of 3.6%.
o New client numbers are declining, as seen for several years pre-pandemic. This doesn’t mean practices aren’t attracting new clients; just that they are attracting fewer of them.
Although these figures seem much more “normal,” many practices still feel overwhelmed with client work. Some of that is just due to the ongoing burnout of the last year in addition to the fact that many practices are understaffed.
Over the last few months, I’ve talked about the difficulty in hiring and the need for improved efficiency and productivity as a way of combatting this. Improving efficiency may end up being an easier way of solving these problems, but that doesn’t mean we give up on hiring.
Interestingly enough, veterinary medicine isn’t the only profession/industry battling hiring and retention issues, and much of what is going on outside of our field applies to us as well. This pandemic timeframe has been termed the “Great Resignation” (Google it—the term is everywhere!) due to the very large number of people leaving their jobs. This trend has been highest in the tech and healthcare industries (including veterinary medicine); both of these are fields that have experienced extreme demand during the pandemic.
While the resignation part of this trend is clearly a bad thing, the silver lining is that candidate pools are bigger and better—they comprise not just those who have already quit but those who are quietly thinking about it. It does mean, however, that the management team is going to have to create an environment that makes people want to work at their practice and design compensation and benefit packages that are attractive to the people you want to hire. What “we,” think is fair, what we have done in the past, and what has worked in the past isn’t going to be enough in the future. Hiring quickly is also essential; one CEO of a software company summed it up by saying, “Recruit at warp speed and be prepared to pay.”
According to various experts, current trends in what employees in all fields want include:
- Work-life balance
- Better life experience
- Better work experience and culture
- Career and personal development
- More flexibility at work
- Desire for meaningful work
- More money
None of the above issues are new to veterinary medicine, but they are all more important to employees now than previously. The time of the Great Resignation has also been termed the Great Reshuffle due to the number of employees changing jobs and/or careers. Most want and need to work, but they don’t want to do what they have done previously, and the pandemic has opened their eyes to the need for not taking life for granted.
In response to what employees want, companies (again in all fields) are focusing on:
- Employee financial well-being (better pay/benefits and increased education about financial literacy)
- Mental health—although other professions don’t have the suicide rates we do, this is considered a major issue across the board
- Work-life balance
- More remote work options
- Transparency in compensation (base pay and bonus/incentive) determination/calculations
- Improved flexibility in how things are done
- A change in desired leadership skills—more people-oriented
- Increased employee development
- Improved measurement of compensation ROI
- Right size management functions
- Eliminating redundant/unneeded positions
- Clarifying roles and responsibilities
- Streamlining reporting and decision making
I’ll talk more about this over the next few months, but one of the first things practices can focus on is a quality assessment of the practice’s resignations. First of all, quantify the number of people you’ve had quit. More importantly, look at the characteristics of these employees:
- Positions—are only the receptionists quitting?
- Age—are only the younger (or older) employees leaving?
- What kind of training did they get? Was it appropriate, or did we set them up for failure?
- Who supervised them? Is one supervisor losing more employees than another? Is that why?
- Compensation—some companies are throwing money at people right now!
- What was the last straw that caused them to quit?
Once you have an in-depth knowledge of why people are leaving, the practice can create tailored retention programs. A similar assessment can be done for terminations—what does the practice need to do better?
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Data review and commentary is provided by Karen E. Felsted, CPA, MS, DVM, CVPM, CVA of PantheraT Veterinary Management Consulting, www.PantheraT.com.
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