ADA News

Results of the ADA Quarterly Survey of Economic Confidence for the second quarter of 2010 were recently released, showing a significant downturn in the indicators measured. But according to an executive summary provided with the survey, the findings may be because dentists are frustrated that the economy is not improving as fast as they would like it to.

"Simultaneously, a sense of impatience and frustration with the pace of economic recovery may be taking hold of the public and resulting in a new round of decisions to delay dental visits. This might be what is being seen in the second quarter 2010 survey results," the summary stated. "The combination of both factors could have resulted in a sharp reversal from the past three quarters as [dentists'] feelings of relief over not seeing conditions worsen are replaced by frustration with the pace of improvement."

More than 2,000 dentists responded to the survey that asked how net income, gross billings, new patients, open appointment times and several other indicators performed relative to the previous quarter. The second quarter survey was the eighth in a series of reports that collected information on the current economic condition of dentists' practices as well as their thoughts on future economic conditions.

"The downturns in these indicators are unsurprising as they occurred during a quarter that almost weekly brought news about a slowing recovery in the employment sector of the economy," the report said. "This type of information would weigh heavily in the forming of the expectations and perceptions of the dentists who responded. Their business is almost entirely a consumer one that relies upon the incomes of employees, so bad news in employment impacts both their financial outcomes and perceptions directly."

Between March and June, there was a net increase of about 621,000 private jobs as well as 79,000 manufacturing jobs, according to the U.S. Bureau of Labor Statistics. However, 125,000 fewer private employment jobs were created in June than in May.

National statistics remain stable, though still poor. July's unemployment rate remained unchanged at 9.5 percent, the BLS reported. Nationwide, 14.6 million people are unemployed.

"These concerns may have been salient in the minds of dentists responding to the July survey, causing a much deeper revision in overall outlook than the slowing of employment justifies," the survey summary stated.

Nearly 46 percent of dentists surveyed said they believed economic conditions would decrease by the next quarter. More than 46 percent said they felt the economy would remain the same, and about 8 percent said they believed it would improve.

This was a marked change from dentists' responses to the first quarter survey, where the majority said they remain confident about economic conditions. The first quarter tends to be a positive one, but it was also the second consecutive quarter in which several indicators looked favorable.

Among the second quarter findings:

• Ten percent more respondents reported a decreased outlook for their net income in the second quarter (55 percent) than in the first quarter (45 percent). However, when respondents were asked how great their actual loss in net income might be, they reported 6 percent on average.
• Nearly half reported an increase in open appointment times.
• Forty-seven percent indicated a decrease in gross billing.
• A decrease in new patients was reported by more than 48 percent of respondents.

Dr. Michael Halasz, who practices in Dayton, Ohio, and chairs the Council on Dental Practice's Subcommittee on Economic Issues, said his personal numbers were up for the second quarter but also said he’s not surprised the report indicated otherwise.

"After the first of the year, people had new dental benefits, and they used them," Dr. Halasz said.

Dr. Halasz also supports a concept suggested in the report: that dentist's perception of their second quarter was, in part, shaped by what they saw happening in the general economy.

"The slowdown in job growth affects the confidence of our patients as well as our own confidence in a recovery," he said.

Members can download the survey for free by visiting the Dental Practice Hub, a resource created by the Council on Dental Practice to help members survive and thrive in their practices. On the web, visit www.ada.org/members/1554.aspx.