Veterinary Services for Animal Specialties

SIC 0742

Industry report:

This industry consists of establishments of licensed practitioners primarily engaged in the practice of veterinary medicine, dentistry, or surgery for animal specialties, including horses, bees, fish, fur-bearing animals, rabbits, dogs, cats, and other pets and birds, except poultry. Establishments primarily engaged in the practice of veterinary medicine for cattle, hogs, sheep, goats, and poultry are classified in SIC 0741: Veterinary Services for Livestock.

Industry Snapshot

The veterinary services industry is responsible for the care and treatment of companion animals (pets), sport animals (e.g., racehorses), and some livestock, as well as the protection of the public from exposure to animal diseases such as rabies. These services are generally performed by the nearly 60,000 licensed veterinarians in the United States, often within the confines of one of the 22,500 animal hospitals and clinics in existence during the early 2010s.

According to the American Animal Hospital Association (AAHA), Americans spend about $20 billion a year in veterinary services for their pets. Total pet industry expenditures reached $45.5 billion in 2009, according to the American Pet Products Association. It is expected that spending on pets, both for veterinary and other products and services, will continue to increase throughout the 2010s.

Organization and Structure

The term "veterinary clinic" is used to describe any veterinary establishment where animals are seen, usually as outpatients needing such services as physical exams, vaccinations, and treatment of minor illnesses and injuries. A veterinary hospital is an establishment that has facilities to treat animals needing to be hospitalized for more than a day. Treatments requiring overnight stays include surgery (most commonly spaying and neutering), tooth extraction, bone repair, and the suturing of wounds.

Because of the substantial investment needed for drugs, instruments, and other start-up costs, most veterinary establishments are group practices, either partnerships or larger facilities that hire individual veterinarians and technicians as employees. Smaller establishments may consist of one to three veterinarians and a technician, who may also serve as receptionist and bookkeeper. Larger establishments may employ several veterinary specialists, additional technicians, an animal dietician, a dental hygienist, and an office manager.

VCA Antech Inc., based in Los Angeles, California, was the country's largest provider of comprehensive health care services for animals in 2010. The company, founded as Veterinary Centers of America in 1986, owned about 520 animal hospitals in 40 states in 2010. VCA's 40 diagnostic laboratories provided services for more than 16,000 animal hospitals throughout America. VCA reported 2009 sales of $1.3 billion with 8,500 employees. VCA continued to expand and in June 2010 purchased competitor PETDRx for $41.25 million.

Other important names in the business included PetSmart. Known primarily for its large selection of retail pet products, there were 1,150 PetSmart stores in the United States in 2010; about 750 of these shops offered onsite veterinary services through Banfield: The Pet Hospital.

According to the Bureau of Labor Statistics, in 2010 about 80 percent of the industry was comprised of veterinarians in private practice. Others were employed by federal and state governments, colleges and universities, private industry, and laboratories. Of the vets in private practice, 77 percent treated pets, which may be dogs and cats exclusively or may include birds, rabbits, hamsters, monkeys, snakes, turtles, and other companion animals. About 16 percent of those in private practice worked with livestock and/or wild animals, and about 6 percent worked exclusively with horses. Small animal services involve pharmacy, surgery, dentistry, ophthalmology, cardiology, orthopedics, oncology, nutrition counseling, obstetrics, radiology, anesthesiology, and internal medicine. Mobile and house call facilities often have established relationships with local veterinary hospitals so that surgical facilities are available when needed.

Geographical region seems to influence the type of veterinary practice. In metropolitan areas, for example, services are generally aimed at treating small companion animals; in rural areas, establishments are more likely to treat livestock and horses.

Large animal practices comprise less than 15 percent of the industry. Except for horses, these establishments are covered under SIC 0741: Veterinary Services for Livestock. Those veterinary services specializing in horses often care for racing horses; such establishments are better compensated financially than most others. Roughly 25 percent of establishments are mixed practices, involving both clinic and house call facilities. Some of these facilities are affiliated with zoos and primarily provide preventive treatment and health upkeep, including vaccinations, dental care, worming, and grooming.
The cost of routine veterinary services is paid for directly by the individual. However, since the early 1980s, health insurance covering accidents, major injuries, and certain chronic illnesses for dogs and cats has been available in most states. For an annual premium of about $50 to $220, with a deductible ranging from $20 to $300, animal owners can purchase major medical benefits for their pets that like those available for humans. As a result, there is a growing trend to continue care for many animals that would have previously undergone euthanasia.

All personnel engaged in the private sector of the industry must be licensed. Veterinarians are required to have a Doctor of Veterinary Medicine (DVM or VMD) degree from an accredited college of veterinary medicine and must pass state board proficiency examinations. Those engaged in specialty services must complete an approved residency program, as well as pass board exams and other board requirements. Some states require licensing of animal health technicians based on minimum educational requirements, an examination, and a fee. In addition, some larger companies, such as VCA, require their vets to have a minimum number of hours of continuing education on a yearly basis. Veterinarians employed by the government need not be licensed.

Background and Development

Because most of the procedures and medicines developed for the treatment of human diseases were first tested on animals, the advancement of veterinary medicine, and therefore the development of the veterinary services industry, is closely related to the advancement of human medicine. Although people have kept animals for companionship for thousands of years, the need for practitioners of veterinary medicine did not arise in the United States until 1883, when bans on interstate transportation and exportation of diseased animals to Europe began to hurt this country's growing livestock industry.

The establishment of the Veterinary Division of the U.S. Department of Agriculture (USDA) in 1883 was the first step toward recognition that treatment and preventive care of animals was a necessity. In May 1884, Congress passed an act that established The Bureau of Animal Industry (BAI). Among its aims was "to provide means for the suppression and extirpation of . . . contagious diseases among domestic animals."

With the industrialization of the United States came shorter work hours, more leisure time, earlier retirement, and longer life expectancies. Animals' status as pets began to receive greater attention and a corresponding demand for better veterinary services resulted. According to a 1990 survey, approximately 43 percent of all households had pets, whereas only 38 percent had children. Many of these pet owners treat their animals as family members, which includes ensuring that they receive competent medical care.

Current Conditions

According to the Bureau of Labor Statistics, there were 59,700 licensed veterinarians in 2009, more than half of which were women. By 2009, 80 percent of all licensed veterinarians were self-employed. The majority of the nation's vets catered exclusively to small animals, serving the 71.4 million U.S. households that owned one or more pets. Along with being responsible for the care of 77.5 million dogs and 93.6 million cats, veterinarians also served 15 million birds and 13.6 million reptiles. Other smaller populations of pets included rabbits, ferrets, guinea pigs, hamsters, and rodents.

Veterinary services and specialties exist for nearly all human equivalents, including chemotherapy, CAT scans, ultrasound, prosthetic hip surgery, pacemaker implants, electrocardiograms, kidney transplants, arthroscopic surgery, dental care, and acupuncture. As a result, the industry is expected to become more specialized into the 2010s. The rising popularity of medical insurance for pets allows more pet owners to afford technologically advanced treatments that otherwise would be too expensive, and some believe that the small, one-to-three-person practice will eventually be replaced by large, centralized veterinary hospitals with staffs of 30 to 50 specialized veterinarians and technicians.

A trend toward more unconventional methods of private practice, such as mobile clinics, low-cost spay clinics, vaccination clinics, and tax-exempt, government-subsidized animal welfare groups, was also noted in the late years of the first decade of the 2000s. Some veterinary facilities were taking a more holistic approach, considering environmental factors, nutrition, and the psychological needs of animals.

In an effort to increase revenues, veterinary establishments started to include the sale of over-the-counter drugs and pet supplies such as food and parasite control products. This practice allowed for competition with feed stores, pet health centers, and pet supply stores, which also tended to offer free advice on the use of drugs and other animal health products.

Workforce

In 2009, the average annual salary for a practicing veterinarian in the United States was $90,100. Top-paying states for the occupation, according to the Bureau of Labor Statistics, included New Jersey, Connecticut, Florida, California, and South Carolina. States with the highest concentrations of veterinarians in relation to population were Colorado, Montana, Idaho, Oregon, and Wisconsin.

Employment in this industry was expected to grow 33 percent between 2008 and 2018--which is faster than the average of all occupations--with a higher demand for specialized facilities in metropolitan areas. An increasing need for additional small animal clinics was predicted as the pet population increases, although small animal practices may become more competitive because most graduates prefer to live in more populated areas rather than rural areas caring for larger animals. Large, multi-hospital corporations (such as VCA) and clinics that incorporate pet stores and grooming in one facility may be one way to counteract competition and increase revenues. Advertising, including television, direct mail, newspapers, Yellow Pages advertisements, and advertisements in professional publications, once shunned, will also play a greater role as this industry grows.

America and the World

The World Veterinary Association (WVA) meets every three years to discuss animal welfare throughout the world. One of the association's objectives in the early 2010s was to develop its "One World-One Health" agenda, which focused on a "unified approach between veterinary and human medicine to improve global health for people and animals." It was also gearing up for 2011, designated as World Veterinary Year and as the 250th anniversary of the veterinary profession. The organization continued to pride itself on keeping politics out of the discussions and maintaining animal welfare as its priority.

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