Retail Pharmacist Salary Growth Stalls, while Hospital Pharmacists’ Salaries Rise

There’s some bad news in our latest exclusive annual analysis of pharmacist salaries, based on the Bureau of Labor Statistics’ (BLS) recently released Occupational Employment Statistics (OES).

In 2015, the average gross base salary for a pharmacist at a retail, mail, and specialty pharmacy was $119,517—up a paltry 0.1% from 2014. Retail employment grew slowly, with slightly fewer pharmacists working at drugstores and mass merchants.

Meanwhile, employment at mail pharmacies and hospitals grew. Pharmacists who work at hospitals also got some good paycheck news: Their salaries rose by 1.6%. The share of pharmacists who work at hospitals grew, too.

My $0.02? The pharmacy industry’s ongoing shift from traditional to specialty drugs is altering long-standing pharmacist employment patterns. Pay attention.

SHOW ME

BLS and the State Workforce Agencies (SWAs) collaborate on the OES survey. BLS funds the survey and dictates its structure, while the SWAs collect most of the data. The OES survey categorizes workers by detailed occupations based upon the Standard Occupational Classification (SOC) system. For more on these data, see the OES FAQ page.

The “pharmacist” occupation code is 29-1051. Using these data, we identified pharmacists working at retail, mail, and specialty pharmacies by analyzing the following NAICS (North American Industry Classification System) industries:

• Chain and independent pharmacies: NAICS 446110

• Supermarkets with pharmacies: NAICS 445100

• Mass merchants with pharmacies: NAICS 452000

• Mail pharmacies: NAICS 454100

Note that BLS computes the annual wage data by multiplying an hourly mean wage by a "year-round, full-time" figure of 2,080 hours. The data below show full-time, gross salary data. The wage data exclude bonuses and employer costs of nonwage benefits, such as health insurance and employer contributions to retirement plans.

THE MONEY

In 2015, pharmacists at retail, mail, and specialty pharmacies earned annual salaries averaging about $119,517, up only 0.1% from 2014. (See the table below.) That’s the smallest increase since I started tracking these data, in 2011.

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Here are my observations about 2015 trends:

• Mass merchants still ahead. For the fourth consecutive year, pharmacists at mass merchants had the highest average salaries, earning a full-time average of almost $123,000. Annual salaries at supermarkets and mail pharmacies were lower. I wonder if future data releases will show that CVS Health’s acquisition of Target’s pharmacies changed this trend.

• Mail employment rose sharply. Pharmacist employment at mail pharmacies grew by 21%, while employment in supermarkets and mass merchants dropped. Salary growth for pharmacists at mail pharmacies, however, declined slightly (-0.1%) compared with other outpatient dispensing formats. Since overall mail prescription growth is flat-to-negative, I presume that these data reflect the growth in specialty pharmacies. See The Top 15 Pharmacies of 2015.

• Hospital employment keeps growing. According to the BLS, total U.S. pharmacist employment was about 296,000 people in 2015. Since 2010, employment has grown by 27,590 people (+10.3%). Employment is shifting, however. The share of employment at retail, mail, and specialty pharmacies has declined, from 65.2% of pharmacist employment in 2010 to 61.8% in 2015. Meanwhile, hospitals’ share of pharmacist employment has grown, from 23.2% in 2010 to 24.5% in 2015. The remaining pharmacists worked at manufacturers, wholesalers, government agencies, non-hospital healthcare providers, and other organizations.

• Pharmacist salaries exceeded those of other healthcare workers, but growth lagged in 2015.The average pharmacist salary grew much more slowly in 2015 than did the average salary for all healthcare workers. Salaries for all “Healthcare Practitioners and Technical Occupations” averaged $77,800. Thus, pharmacist salaries at retail, mail, and specialty pharmacies were about $42,000 (+54%) higher than average healthcare salaries. But as the chart below shows, pharmacist salaries grew much more slowly than did those of all healthcare workers, who saw their salaries grow by 2.4% in 2015. Average pharmacist salaries at hospitals grew by 1.6%, to $119,270.

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Note that the OES data exclude self-employed pharmacists and pharmacy owners. Based on industry survey data, the average pharmacist owning a single pharmacy earned about $228,000 in 2014 (the most recent year available). See Independent Pharmacy Economics: Profits Steady, but Sales Down (Maybe).

The 2015 trends are consistent with the BLS forecasts in its Occupational Outlook Handbook. As I describe in Grim Job Outlook for Retail Pharmacists, BLS projects that drugstores will employ about 7,000 fewer pharmacists in 2024 than they do today. Pharmacist employment in non-retail settings—hospitals, doctor’s office, and clinics—is projected to add more jobs than the ones lost from retail.

The bright side? It’s not too late for retail pharmacists to plan for a career as a wind turbine service technician!