Is it possible to get the right amount of pharmacists? Or are we permanently facing a crisis of oversupply? Michael Ortiz does the numbers

Ron Roland, a former CEO of a large pharmacy wholesale supplier (API), would regularly remind his staff that “proper planning prevented poor performance”.

Unfortunately for the pharmacist profession, a  lack of manpower planning by the leaders of  their professional associations, as well as the vested self-interests of some senior Pharmacy academics in graduating too many students, has created a potential pharmacist manpower “oversupply” disaster in Australia.

Australian Pharmacy Board statistics provide a useful picture of pharmacist numbers, age and gender distributions as well as how these numbers have changed over time (Table 1).  At the start of 2018 there were 28,000 pharmacists registered in Australia with a further 1700 provisional registrations who were undertaking their internship training (Table 1).

Around 62% of registered pharmacists are female and 67% are aged under 45 years.  Less than 5% of registered pharmacists are aged over 65 and still working as a pharmacist. The total number of registered pharmacists had increased by 18% over the 5 year period, while there was a 28% increase in female registrations over the five years since 2013.  There was a 2,700 increase in under 45 age group registrations (17%), there was a 28% increase in the 45 to 64 age group and a 5% decrease in the 65 plus age group (Table 1).

Workforce supply and demand modelling of pharmacist numbers described in the 2015 Pharmacy Workforce Planning Study [3], highlighted the impact of changes in pharmacy practice on pharmacist supply and demand.

The right estimate

The “best estimate” model predicted growth in pharmacist supply of 600 pharmacists per year with an oversupply of more than 10% by 2020 and with pharmacist demand continuing to fall beyond 2020. An “expanded professional services” model closed the gap between supply and demand for pharmacists, but did not return them to balance. Finally a “minimal change” model predicted an even greater oversupply of pharmacists exceeding 20% by 2025. This would be a manpower disaster to say the least.

Leaving this oversupply of pharmacy unchanged could have profound long term effects on the profession, resulting in lower wages, poor job satisfaction, increased unemployment and the loss of  large numbers highly qualified graduates from the profession. This is in addition to the wasted time and money spent educating students for jobs that don’t exist. It also wastes the time of their pharmacist preceptors and we register these pharmacists knowing that many of them may never find employment as a pharmacist.

One only has to look at the Australian Medical profession to see how their leadership is more effective in managing their manpower.  Their workforce planning projections [4] suggest that Australia’s demand for its 100,000 medical practitioners should align with supply. The “no change” scenario model predicted that the workforce would be in oversupply to 2017 before dropping to undersupply from the early 2020s. This leads to a gap betweenswitching from  an oversupply of 2,500 in 2025 moving to a shortfall of around 5,000 by 2030.  An “Economic constrained” model predicted that the medical workforce would change from a small undersupply relative to the starting point of 5,000 to a small oversupply of 5000. An “Economic constrained coupled with productivity gains” model predicted a small oversupply of the medical workforce and any gaps could be addressed through adjusting domestic supply, adjusting international supply or a combination of both. The medical profession uses two basic approaches to address an oversupply situation. They (1) reduce supply and/or (2) increase demand.

Table 1:  National Pharmacy Board Statistics                                                                                                                                                                                                                                                                                                    

Registered Pharmacists

Number in 2018

Number in 2013

5 year change

5 year change

General  register

28129

23820

4409

18%

Female

17579

13742

3737

28%

<45

18806

16099

2707

17%

45-64

7940

6213

1327

28%

65+

1382

1508

-126

-8%

Provisional registration

1710

1759

-58

-3%

Active work location

 

 

 

 

·       Community

 

13454

 

 

·       Hospital

 

3762

 

 

·       Other

 

4115

 

 

·       Not working in pharmacy

 

2404

 

 

Source: Australian Pharmacy Board online statistics [1, 2]

There are two essential steps required to return the oversupply market to equilibrium:

Step 1:  Pharmacist supply must be reduced by 3,000 over 5 years

Not surprisingly the pharmacy academics who conducted the Australian pharmacist manpower modelling seemed to have put changes to the supply side of the equation in the too hard basket. Their modelling suggests that demand can be improved by expanding pharmacists professional roles and the “do nothing” model resulted in disastrous oversupply exceeding 20% with no improvement in the 10 year model projections.

National Pharmacy Board data in 2018 showed that there are 28,000 registered pharmacists and around 1.700 new graduates each year (Table 1) with “best estimate” model predicting an oversupply of around 3,000 pharmacists. If there is no change in the Pharmacy manpower strategy, then Pharmacist oversupply numbers will continue to increase by around 600 pharmacists per year over the next 5 years.  If this growth continues unabated, then the oversupply of pharmacists could balloon out to 6,000 (20%) in 5 years [3]. The obvious place to start to address a manpower oversupply is to reduce the number of students studying pharmacy. Unfortunately, the pharmacy profession has little control over the number of students accepted to study pharmacy.

Where the profession does has some control is over the number graduates who receive a 12 month internship required as part of their pre-registration.  Manpower model data suggests that pharmacist numbers are growing by 600 per year, so unless internships in community and hospital pharmacies need are reduced by 600 per year for 5 years, the oversupply of pharmacists will continue to increase. Any reduction in the number internships would be unpopular with students.

A much more difficult change to supply would come from reducing student intake.  Currently there are two pathways (1) four year under graduate and (2) two year Masters pharmacy degrees offered by around 20 academic institutions all around Australia.

In the absence of any data demonstrating large differences in the quality of the graduates of these two different pathways, (from a simple cost perspective), the profession should consider advocating moving to a two year post graduate course costing half that of a four year under graduate course (no HECS payment deferral is available for post graduate degrees).  In terms of wasted education dollars, a two year post graduate student failing to find employment as a pharmacist is much less wasteful of educational resources than a four year trained graduate.   Maybe it is time that the highly paid pharmacy academics are held accountable for wasting students and taxpayer funds by training too many pharmacy students for jobs that simply don’t exist. Furthermore, how can they justify a four year pharmacy undergraduate course over a two year post graduate course, if they deliver a similar product that takes twice as long to complete and at double the cost..

It is obvious to most, that the proliferation of new Pharmacy schools in Australia has generated a dramatic growth in the number in pharmacy graduates (around 1,700 provisional registrations needing an internship a year) and that this is what has caused the current pharmacist oversupply disaster.

If these pharmacy schools fail to acknowledge the harm that they have caused to the profession, through their contribution to the pharmacist oversupply and more importantly if they fail to take immediate remedial action to drastically reduce student intakes, then the profession should react by reducing their financial and in kind support to these pharmacy schools, until such time as they reduce their student intakes.  There is little point donating money and/or time to a pharmacy school, if in doing so, you are harming the profession by increasing the oversupply of pharmacists.  That is, as many as half of the new pharmacy graduates each year could join a growing pool of oversupply pharmacists, who will not be able to find employment as pharmacists in the short term. This will also harm the employment prospects of practicing pharmacists whose bargaining power is diminished in an oversaturated employment market. 

One only needs to look at recently graduated high school teachers to see the negative impact of a manpower oversupply in the relatively fixed employment market. Many teachers have been waiting up to ten years to find a permanent job within a reasonable distance from their home. Job satisfaction is poor and large numbers of graduates give up looking for work as a teacher.

Step 2:  Pharmacist demand must be increased by 3,000 over 5 years

The other way to reduce oversupply is to increase demand for pharmacist services and this was supported by the manpower “expanded professional services” model [3].  There are three possible areas where pharmacist demand could be increased:

  1. Increased non dispensing related professional services reimbursed by the MBS and provided by accredited pharmacists in community pharmacies
  2. Increased medication related activities by hospital pharmacists taking on nurse drug administration roles in hospitals and Aged Care facilities.
  3. Embedding non dispensing pharmacists in GP practices to improve medication use by patients [5].

A target of 600 new pharmacist positions per year in Australia over the next 5 years would bring pharmacist supply back in line with pharmacist demand, provided that there is little or no growth in pharmacist supply (ie. reduced pharmacy student intake or reduced internships). These new employment opportunities should be designed to be value for money as well as improve health outcomes (through the better use of medicines).

These targets will be challenging but are achievable if they are endorsed and supported financially by the Federal Government with MBS funding.  That is:

  • 1000 more pharmacists jobs over 5 years dedicated to professional services with MBS funding, more than half should be in non capital cities and rural areas (where there is a well documented undersupply of medical practitioners).
  • 1000 more pharmacists jobs over 5 years in Australian hospitals and Aged Care facilities dedicated to medication administration, thus freeing up already scarce nursing resources that can be better spent on neglected patient care activities. (That is, substituting “oversupply pharmacist” labour for “undersupply” nurse labour, in particular where the quality of the pharmacist service is likely to be no worse than or better than the current nursing service.)
  • 1000 more pharmacists jobs over 5 years embedded in general practices with MBS funding for their services and least half of the pharmacists are to be located in non capital cities and rural areas currently underserviced by medical practitioners.

The profession of pharmacy has little choice.  It must decrease supply and increase demand for pharmacists in order to address the dramatic oversupply of pharmacists in Australia.  If the profession fails to act, then this will spell disaster for many young employee pharmacists resulting in: lower wages, poor job satisfaction, increased unemployment and the waste of millions of education dollars and the loss of a large numbers highly qualified University graduates to other industries or occupations.

In conclusion, it is time for the pharmacy profession’s leadership to get their heads out of the sand and to take up the challenge of returning the pharmacist market to equilibrium by balancing pharmacist supply with pharmacist demand. It is also time for Pharmacy schools to put their hands up and acknowledge that they were responsible for the increase in the number of pharmacy graduates that has caused the disastrous oversupply of pharmacists and that they will act immediately to reduce the number of new students.

If pharmacist leadership lacks the courage to make these hard decisions or senior pharmacy academics fail to act to reduce the number of pharmacy graduates, then they need to step aside so we can find new leaders who will make these hard decisions even if they are unpopular.

Michael S Ortiz BPharm, MSc, PhD, runs Zitro Consulting Services and is Associate Professor in health economics at the University of NSW

References

  1. Pharmacist Registration Board online statistics 2013 pharmacyboard.gov.au/About/Statistics.aspx
  2. Pharmacist Registration Board online statistics 2018 pharmacyboard.gov.au/About/Statistics.aspx
  3. Ridout L. The Pharmacy Workforce Planning Study Human Capital Alliance 2015 http://6cpa.com.au/wp-content/uploads/Pharmacy-Workforce-Planning-Executive-Summary.pdf
  4. AUSTRALIA’S FUTURE HEALTH WORKFORCE – DOCTORS August 2014 https://www.health.gov.au/internet/main/publishing.nsf/Content/F3F2910B39DF55FDCA257D94007862F9/$File/AFHW%20-%20Doctors%20report.pdf
  5. Polasek TM, Rowland A, Wiese MD & Sorich MJ Pharmacists in Australian general practice: an opportunity for expertise in precision medicine Ther Adv Drug Saf 2015, Vol. 6(5) 186 –188