Academic journal article American Journal of Pharmaceutical Education

Economic Analysis of Obtaining a PharmD Degree and Career as a Pharmacist

Academic journal article American Journal of Pharmaceutical Education

Economic Analysis of Obtaining a PharmD Degree and Career as a Pharmacist

Article excerpt

INTRODUCTION

In recent years, the US economy, with its increasing challenges, has put traditional investment strategies and positions in question. Moreover, this increased economic uncertainty has been associated with intense scrutiny and critical evaluation of financial decision making from virtually all sectors. Criticism of the financial value of certain careers and the pursuit of particular postsecondary degrees, including health professions, have not been spared. In fact, a survey conducted by Taylor et al found that 57% of Americans believe the higher education system does not provide good value for the money spent on it. (1) Further, financial concerns were the primary impediment to pursuing a college education, especially given that more than 60% of undergraduate students borrowed money to assist in covering their educational costs, and currently more than 40% of median income is used to pay for college tuition (an increase from less than 25% in 2000). (2,3) An article published in the New England Journal of Medicine indicated that students in health professions graduate with considerable debt-to-average annual income ratios, ranging from slightly more than 30% for orthopedic medicine to greater than 160% for veterinary medicine. (4) The authors concluded the high cost of health professions education may not be sustainable.

Projected growth for the pharmacy profession is anticipated at 14% between 2012 and 2022, according to the US Bureau of Labor Statistics. (5) Factors contributing to the proposed projected growth include the aging population, availability of new drug products, and increasing complexity of the health care system. The Bureau of Labor Statistics' projections are corroborated by the US Department of Health and Human Services, which anticipates that national need for pharmacists will increase 1.4% annually through 2030. (6)

Based on this information, pharmacy seems to be a good career choice. Yet, many have expressed concerns regarding the future employment prospects of pharmacists. For example, Brown noted that a 60% increase in the number of pharmacy schools between 2000 and 2012 and growth of existing pharmacy programs resulted in a considerable influx of new pharmacists into the job market. (7) As a result of the increased supply of pharmacists, the demand has consequently decreased. According to the Pharmacy Manpower Project's Aggregate Demand Index, national demand for pharmacists has declined somewhat from 3.8 in September 2005 to 3.49 (5.0 indicates highest possible demand and 3.0 indicates balance between demand and supply) in August 2015. (8) Although this demonstrates there is still greater demand for pharmacists than supply, it also suggests pharmacists may face different challenges than in the past.

Zavadski suggested pharmacy education may be subject to a bubble market, wherein "a good becomes overvalued because buyers are willing to pay higher prices in hopes of selling it for a greater payoff. The bubble deflates when the asset suddenly returns to a more reasonable intrinsic value, leaving buyers from the peak of the boom with something worth far less than what they paid." (4,9,10) In other words, for many, pharmacy education is worth the investment as long as pharmacist salaries remain high and jobs are available and desirable; thus, should salaries decrease and jobs/desirable employment opportunities become unavailable, the value of pharmacy education declines.

Although commentary exists concerning the value of a pharmacy degree, virtually no studies published in the literature objectively model the estimated long-term economic benefit and return on investment of obtaining a pharmacy degree and working as a pharmacist under current conditions. Hagemeier and Murawski compared economic outcomes of directly entering community pharmacy practice after earning a doctor of pharmacy (PharmD) vs earning a PhD after earning a PharmD and then entering a career in academia or industry; however, this study did not consider the effects of other educational tracks, residency training, and/or pharmacy career paths such as hospital. …

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