Student academic debt is growing 4.5 times faster than the incomes of recent veterinary graduates, according to a presentation by Bridgette Bain, PhD, associate director of analysis at AVMA.
Dr Bain spoke about “supply and demand in the veterinary education market” at the AVMA’s annual economic summit, which was held virtually October 26-28, relying heavily on on data from the AVMA 2020 survey for seniors. She said the way student debt is growing faster than starting salaries is unsustainable.
“We have to keep an eye on it so that we can develop strategies and we can work to counter that,” she said.
While there has been an overall increase in the debt-to-income ratio, the debt of Class of 2020 veterinary students varies widely from institution to institution.
For example, Washington State University and Purdue University both saw more than 10% decrease in average veterinary education debt, while Mississippi State University and Auburn University saw increases of more than 15%.
“It means there is a conversation to be had,” said Dr Bain. “What can schools that manage to graduate … with (year-over-year) debt reduction teach schools with year-over-year debt levels?” can increase up to 20%? What can we learn from each other to be better for the whole profession? “
Dr Bain also discussed data that shows debt varies by race. Black or African American graduates were more in debt than their graduate peers. White and Caucasian students were the least in debt.
Other key points highlighted during the session are as follows:
- The average school debt for all U.S. veterinary college graduates for 2020, including those without debt, was $ 157,146.
- Ninety-four percent of graduates obtained full-time employment or accepted a post in higher education two weeks before graduation.
- Nineteen percent of veterinary students graduated with a debt-to-income ratio of zero, but 20% graduated with a 4: 1 ratio. The average debt-to-income ratio was 2: 1.
- Women graduated with a higher debt-to-income ratio, on average, than men.
- Thirty-nine students, or 1.4% of 2020 graduates, graduated with debt greater than the total cost of their veterinary education.
- Students who reported a major life event during their veterinary studies were in more debt than those who did not. In addition, students who had to repeat a course had higher debt. Forty-six percent of all students with debt had a budget.
- The majority of 2020 graduates said they plan to embark on pet medicine, while 33.3% said they plan to pursue higher education, including an internship, residency, or a doctoral program. However, the percentage of graduates who said they plan to pursue internships is declining.
- The weighted average starting salary for students entering full-time employment was $ 90,722.
- The potential impact of the COVID-19 pandemic on starting salaries has yet to be seen. By comparison, the effect of the 2008 financial crisis was only seen in 2010, said Dr Bain.
- Seventy percent of veterinary graduates said there had been no change in their job postings due to COVID-19. But 3%, or roughly 90 students, said their offer had been revoked or withdrawn.
“Although salaries increased between 2019 and 2020, we have yet to see the impact of COVID-19 on starting salaries,” said Dr Bain. “So far we’ve been good, but as things unfold we’ll see what happens.”