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Howard Speaks: Dentistry Could Come Back with a Vengeance Howard Farran, DDS, MAGD, MBA, DICOI; Publisher, Dentaltown Magazine

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Dentistry Could Come Back with a Vengeance
by Howard Farran, DDS, MAGD, MBA, DICOI, Publisher, Dentaltown Magazine
This recession has been hard on all of us, but there is a little economic secret that you all should know that will turn your frowns upside down. It's called pent-up demand, and you're going to be seeing the results of it very soon.

During an economic contraction, if you decide at lunchtime you are not going to go to Arby's and get a sandwich, fries and a Coke, but instead bring a sack lunch to work, Arby's loses that sale. It's finite, they're never going to get it back. Knowing money is tight, you go home and instead of taking the family out to the local Mexican restaurant, you might stay home and eat Ramen noodles. That's a sale the Mexican restaurant will never ever see. This always happens in down economies.

The thing we all need to keep in mind is with the nine recessions we've seen since World War II - the current one being the 10th - the economy always comes flying back. Why? You might not be spending discretionary income on things you don't need, like going out to lunch or getting a facial, but you are still driving your car, your tires are getting bald, you're still using the refrigerator you've meant to replace for years, lightbulbs need to be replaced, etc. Important things are breaking down; they are things you use every day that you need to replace soon before you end up in the dark, with a flat on the side of the road or with a refrigerator full of spoiled food.

That also pertains to dentistry and orthodontics. I'm 50 years old and when I was kid growing up in Kansas, there were a lot of families that had around five children. Usually then the child with the most crooked teeth was the only one in the family who got braces. Now, with birth control and as America progressed, we average around two children per family, and every child gets ortho. Since the beginning of the recession in 2007, a lot of orthodontic practices have experienced a huge drop in the number of cases they've started. Several ortho practices have had to shut their doors because of this. For the ones who have stuck this recession out, I want to remind you that all those families who put off braces for their children over the last five years are going to come back and get braces soon. It's pent-up demand! Maybe Molly didn't get braces at 12, but she's sure as heck going to straighten her teeth when she's 16! Maybe she'll even pay for Invisalign herself when she gets her first job out of college. You might not have seen her in the last five years, but I guarantee you're going to see a lot of her soon when she finally comes around to get treatment.

The economy is coming back in America. They say it's always darkest right before sunrise, and I'm here to tell you I'm already seeing the sunrise in Phoenix, Arizona. We were hit massively hard here during the recession. Construction companies were building 60,000 homes a year here up to 2006, and after the great economic contraction, that number shrank to 10,000. All the people it took to build those other 50,000 homes each year lost their jobs. Home prices contracted big time. Also during this time, around 150 dental offices here in the Valley of the Sun closed their doors forever.

The other issue we had in Arizona was until recently the state didn't have a dental school. Now we have two: Arizona School of Dentistry & Oral Health - A.T. Still University, and The College of Dental Medicine-Arizona (CDMA) at Midwestern University. See Fig. 1 for the number of new dentists each school has graduated since 2007:

We saw hundreds of new dentists graduate from our brand-new, local dental schools during the recession who tried to open their own practices and failed because they thought all it took to own a practice was to open up in a great visible location, in a strip mall anchored by a grocery store or a Walmart, next to a four-lane intersection, do some direct mail, and put up a website. The supply of dentists in our area was way oversaturated and massively changed the business of dentistry in the Phoenix area. The problem isn't local to Phoenix, it's everywhere. Look at Fig. 2, which shows unemployment figures from the Department of Labor since 1984, then take a look at Fig. 3, which shows the total number of practicing dentists each year since 1984. You'll also notice in Fig. 4, that during this latest recession, the dental school graduate numbers have risen. Everyone talks about a demand problem in dentistry with this current recession, but what dentistry really faced in the latest high-unemployment years was a supply issue.

Things are changing, however. According to InternationalForestIndustries.com, due to rapidly increasing housing starts in the United States, “lumber and panel prices will move to new highs in 2013 and record highs for lumber in 2014." The average median real estate price in Arizona has risen from $248,229 in Aug-Oct 2006 to $320,164 as of January 30, 2013 - that's a 22 percent increase. Housing is the biggest sector of the economy. Everything I'm reading indicates housing prices are increasing, which means the inventory is being bought up, and wherever real estate goes, so goes the economy.

As the economy improves, we're going to start seeing the results of a five-year pent-up demand for dentistry. It's already happening! I've owned my dental office since 1987, and today we are doing more root canals as a percentage of income than we've ever done before.

I'm sorry to sound this upbeat and positive, because this truly is the dark side of economics. When the media talks about how bad Hurricane Sandy and Katrina were, it's true, those storms were devastating. People lost their homes, their jobs and their way of life. On the other hand you don't hear any construction companies complaining about it because they get a ton of work in the rebuilding process. Whenever you see a house burn down, it's really sad for the family, but that devastating fire does provide jobs for firemen and people who build and remodel houses.

In dentistry, we diagnosed a lot of cavities in 2007, 2008, 2009, 2010, 2011 and 2012, when patients just said, "I lost my dental insurance because of this recession. I really can't afford to take care of these cavities right now," and walked away. Now those little $250 cavities have grown into the nerve, they're painful and they require a $2,000 root canal build up and crown. You don't feel good about it, but on the balance sheet, man, it's just endo heaven. I'm also hearing stories all over the dental profession like little Molly has been whining to her mother for five years about her crooked teeth. When is she going to get them straight and when is she going to get braces? Housing is coming back, people are now getting root canals and crowns, and I see ortho starting to come back with a vengeance.

Better times are ahead, gang. Remember, dentistry is a need, and we've seen a lot of pent-up demand accrue over the last five years. The economy is improving and dentistry is just going to explode! What didn't get fixed in the last five years is going to get fixed.

Dentaltown Magazine
September 2025
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