
Pharmacist Job Outlook: Supply Versus Demand
I have been passionate and active about the job market outlook of pharmacists, their function and value to the healthcare team and their provider status for the last 10 years, both as a pharmacy executive and a clinician with academic responsibility to train pharmacy students and residents. Of course, there are always opposing views and different perspectives with this subject depending on where you are in this healthcare continuum.
More pharmacists are graduating than ever because there has been tremendous growth in the number of pharmacy schools. As of January 2021, there are 140 schools in the U.S. that are recognized by the Accreditation Council for Pharmacy Education (ACPE). That’s about 60 more than in 2000, or a 73% growth in Doctor of Pharmacy programs.
It used to be that only about 32% of applicants were accepted into a PharmD program, but acceptance rates have skyrocketed to over 80%.
Not surprisingly, there are more PharmDs graduating than ever. Between 14,000 and 15,000 people are graduating from pharmacy school each year, according to the American Journal of Pharmaceutical Education.
Will 5% of the existing 314,300 pharmacists retire every year? Absolutely not.
There used to be a shortage of people to meet pharmacist job growth. And that’s when the pharmacist salary really started to rise. Demand for pharmacists almost trebled in 2019, with the number of job ads growing by nearly 180% last year, says Indeed.
But the increase in schools has led to an upsurge in students and graduates. That could mean a leveling out of pay for pharmacists. Right now, the median entry-level pharmacist salary is $102,414 according to PayScale.
When we’re looking at the job outlook for pharmacists, it’s important to see how many jobs are out there (demand) versus how many candidates are out there to fill the positions (supply).
If there are more open positions and fewer people to fill them, it’s easier to get a job. And, thus, pharmacists’ salaries would likely increase. But if there are fewer pharmacists job openings and a bunch of pharmacists looking for jobs, it will take longer to find employment. Income can stagnate and even go down.
According to the Bureau of Labor Statistics (BLS) that were just released, here is the dim outlook for the pharmacist job market. While the expected average growth rate for all occupations over the next 10 years is 4%, pharmacist employment is actually expected to decline during that period.
• The median wage for pharmacists in 2020 was $128,710
• There were 321,700 pharmacist jobs in 2019
• The Bureau of Labor Statistics projects a 3% decline in pharmacist employment from 2019 to 2029
• The number of pharmacist jobs will contract by 10,500 positions by 2029
• 14,000+ pharmacists graduate yearly when a projected zero new pharmacist jobs are being created
We are certainly at a crossroads.
What I can feel fairly sure about is that the demand for pharmacists is there and should continue to grow. The biggest question is what the job market will actually look like. The primary factor will be the number of new pharmacists graduating each year.
The job market for pharmacists during the COVID-19 pandemic has improved markedly compared to the few years preceding it. But I think the long-term trend of the pharmacist job market will face challenges given the oversupply of new graduates at the pharmacy school level.
In a 2017 interview with Drug Topics, Lucinda Maine, executive vice president and CEO of the American Association of Colleges of Pharmacy (AACP), said the number of applicants to pharmacy schools is shrinking. According to sources, applicants for the 2019-2020 cycle fell by 15%.
This could theoretically help current pharmacists and their career prospects. But the applicant number needs to shrink 50% or more to fix the problem. The only way that happens is if at least half of pharmacy schools close their doors.
If the pool of applicants to pharmacy school shrinks, some of the poorly-run or overly-expensive pharmacy schools won’t be able to fill their classrooms. This would cause those schools to lose money and eventually close down.
That could cause a chain reaction. Fewer schools mean fewer graduates, which would slow the supply of new pharmacists entering the market. This would then make the job market better for pharmacists.
Residency is also now becoming a norm for pharmacists. Though this leads to much better training, it’s not great for salaries. It means hospitals can pay less for pharmacists right out of school. Hospitals can do this because the pharmacist job market is becoming more and more competitive.
Hopefully, the projected growth of pharmacist hospital jobs will come to fruition. There might be some growth in the hospital setting like I have mentioned, but it might not be enough to offset the challenges in other areas of the profession. Clearly pharmacy schools need to prepare students for jobs besides traditional positions graduates usually fill.