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’ salary would likely increase. If there are fewer job openings and a bunch of pharmacists looking for jobs, it will take longer to find employment; income could stagnate and even go down.
First, let’s take a look at the job market for pharmacists.
Pharmacist job outlook
According to the Bureau of Labor Statistics, there were 312,500 pharmacist jobs in 2016 and, with projected 6% annual growth, somewhere around 17,000 new positions being added to the market each year. That would be some pretty robust demand, which would be a good thing for those with a Doctor of Pharmacy (PharmD).
That growth is projected to come from increased needs as baby boomers age. Much of the pharmacist job growth is projected to come from the hospital setting. Hospitals are seeing more and more value in having clinical pharmacists on hand so they can dispense and monitor patient responses to medication as well as patient outcomes.
This could bode well for pharmacists with student loan debt, since most hospitals would be qualifying employers to get Public Service Loan Forgiveness (PSLF), saving PharmDs a lot of money paying back their student loans.
Places like Walmart, CVS, Walgreens, Target and Express Scripts are supplying a lot of those jobs at the moment. But those companies set up shop and got in the game quickly. It may have been too quick because now they’re starting to reduce full-time pharmacist positions.
Adding it all together, the projected growth makes it look like pharmacists will continue to be in demand. The need for pharmacists will grow as more and more positions become available.
The second part of the equation is this: How many new pharmacists are graduating each year, and how does that compare to the projected job growth?
More schools of pharmacy enter the market to meet demand
More pharmacists are graduating than ever because there has been tremendous growth in the number of pharmacy schools. As of January 2019, there are 142 accredited pharmacy schools in the U.S., about 60 more schools than in 2000, according to the American Journal of Pharmaceutical Education (AJPE). That’s 73% growth in just the schools, which is huge.
More schools mean that more applicants are getting accepted to school and becoming PharmDs. All of these new schools need to fill their classrooms with students so they make money, which means it’s easier than ever to get into pharmacy school.
It used to be that only about 32% of applicants were accepted into a PharmD program, but acceptance rates have skyrocketed to 82%.
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 Association of Colleges of Pharmacy (AACP). That number is slightly below projected pharmacist job growth of 17,000 but still pretty darn close.
There used to be a shortage of people to meet pharmacist job growth, which is when the pharmacist salary really started to rise. 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 $105,936, according to PayScale.
The “real” job market for pharmacists
It may seem like the job market for pharmacists is growing rapidly. But we’ve heard from hundreds of pharmacists here at Student Loan Planner, and many of them are having trouble finding full-time work.
Pharmacists often get the short end of the stick as these major pharmacy chains try to cut costs by hiring many part-time employees instead of paying for full-time benefits. Why can they do this? It’s because of all of the people now being accepted and graduating with a PharmD.
Companies like Kroger laid off pharmacists and moved weekly work hours down from 40 to 32. CVS, Walgreens and Target are hiring part-time pharmacists rather than full time. We’ve heard from many pharmacists that they have to take on two part-time jobs because their employer isn’t giving them enough hours.
But it’s not only that. Residency is also now becoming a thing 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. Pharmacists are chasing the highly-coveted, full-time jobs at hospitals, where they get the hours they need and also qualify for PSLF.
Hopefully the projected growth of pharmacist hospital jobs will come to fruition because they’re one of the better positions to get as a pharmacist.
Pharmacist career growth
We are certainly at a crossroads.
What we 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 growth of pharmacy schools and graduates has outpaced pharmacy job growth, and right now, it appears the supply of new PharmDs is meeting the job demand. But if the growth of pharmacy school graduates continues to outpace the actual job growth, we could see pharmacist salaries stagnate and the ability to find a full-time job become an even greater challenge.
In a 2017 interview with Drug Topics, Lucinda Maine, the executive vice president and CEO of the AACP, said the number of applicants to pharmacy schools is shrinking. This could help current pharmacists and their career prospects. If the pool of applicants to pharmacy school is shrinking and more than 80% of those people are being accepted to school, that would mean 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 means fewer graduates, which would slow the supply of new pharmacists entering the market. This would then make the job market better for pharmacists.
But if the number of applications goes back up significantly, the opposite will happen, and the pharmacist career outlook won’t be nearly as attractive.
Hopefully, the first scenario plays out so that current pharmacists can have a brighter outlook.
How to handle pharmacy school student loans
We’ve worked with 60 pharmacists who have an average student loan debt of $213,000. Some of them didn’t know how to approach their loan repayment with a part-time job. Even the ones with full-time jobs weren’t sure what to do.
Having job uncertainty is hard enough, but not being sure how to pay off six figures of student loan debt on top of that is extremely stressful. So how do you decide which repayment plan is best for you?
A general rule of thumb is that if someone owes less than 1.5 times their income in student loans (e.g., a pharmacist earning $100,000 who owes $150,000 or less in loans) should consider refinancing. They should make sure beforehand that they can afford to pay off their loans in 10 years or less and that they don’t have any eligibility for PSLF or other loan forgiveness options.
But those with two times their income or more in student loans (e.g., PharmDs making $100,000 who owe more than $200,000) should probably explore income-driven repayment.
We’ve done over 2,000 individual consults and have advised on more than $500,000,000 in student loans. If you’re looking to get help finding a solid plan to pay back your student loans, we’d be happy to help. Along with potential savings, most people say they just feel relieved to have a concrete plan they understand.
Pharmacists can learn more about the consult process here.
If you have any questions or comments, I’d love to hear from you. Feel free to reach out to me email@example.com.