Are worker cooperatives the future of the vet industry?

It is no secret the veterinary industry has significantly changed over the last several years due to the influence of corporatization and private equity infiltration. It is estimated corporate consolidators in the U.S. hold close to 50 percent of all companion animal practice revenue and is on the rise.¹

Those seeking alternatives to mergers or private equity buyouts could consider the worker cooperative model. Essentially democratizing the workplace, the model gives power and governance to the workers by making them owners. The worker cooperative business model also keeps pet care locally owned and aims to ensure quality care is determined by veterinary professionals—and not by those who are in the industry primarily for profit.

What is a worker cooperative?

Worker cooperatives are successful business models, but far too uncommon in the U.S. A 2021 study by the Democracy at Work Institute and the U.S. Federation of Worker Cooperatives found just 612 nationwide, yet also shared a 30 percent growth rate within two years.² In other parts of the world, worker cooperatives compete on a global scale and provide sustainable jobs and services for a significant portion of regional economies.

The International Cooperative Alliance defines a cooperative as “an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly owned and democratically controlled enterprise.”

Americans do not learn much about the cooperative business model even though many of us interact regularly with the different types of cooperatives that exist. Most dairy products come by way of cooperatives—producer cooperatives; all credit unions are financial cooperatives; and some brands are consumer cooperatives.

In a professional space rife with influences by corporations and private equity, the veterinary industry is ready for something different—the worker cooperative model. By dedicating their time, passion, energy, and years of education and training, veterinary professionals work to improve the lives of animals and care for the people who love them, and not likely driven by profit alone.

Veterinary professionals can and should have livable, prosperous wages. The worker cooperative model puts veterinary professionals in the driver’s seat, allowing them to governance over what their jobs look like and how care is delivered.

“[Worker] cooperatives give employees a voice and the opportunity to help shape and drive their practice. Cooperatives tend to be values-driven businesses that put employee satisfaction and the community at the forefront of decision making,” says Lexie Law, LVT, of Urban Animal, a veterinary practice with three locations in Seattle, Wash., that began building veterinary worker cooperatives in 2023. “While we will need to remain profitable to continue to grow and thrive as a practice, there is more than profit guiding us. Veterinary professionals are some of the most hardworking, empathetic people you will ever meet. Where we work should reflect that. We want to take care of animals and do the best we can to help our community,” adds Law.

Worker cooperatives are gaining popularity as a way to create just and sustainable employment. Adam Schwartz, founder of The Cooperative Way, a consulting group specializing in the creation of worker cooperatives, says, “workplace democracy and worker cooperatives are not something you usually learn about in school, yet they are becoming an increasingly attractive option that addresses a variety of the nation’s most common workplace challenges, including labor shortages, corporate culture, pay equity, and succession planning.” This is in part due to recent legislation as seen in Washington’s new bill providing support and resources for companies seeking to become employee-owned,⁴ as well as an increased interest in the model as an alternative to our current economic challenges.

What happens when private equity is managing pet care?

A recent Freakonomics podcast episode, “Should You Trust Private Equity to Take Care of Your Dog?,” quoted economist Eileen Applebaum with the answer:⁴
“The vast majority of states in the U.S. have laws against the corporate practice of medicine, and so there are real problems here. When you have a situation where healthcare is being provided by a company whose first responsibility is to maximize profit, you’re going to see profit prioritized over the treatment of the doctors or the vets and the treatment of the patients … and it is illegal in most states, but private equity at least has figured out a way around it.”

With 66 percent of American households owning at least one pet, and $136.8 billion of household income being spent on these pets,⁵ the pet boom has not gone unnoticed by private equity firms. It is reasonable to suggest the human-animal bond has been identified as a profit center by those driven to generate revenue in the name of profit and shareholder payouts.

With nationwide staffing shortages at all positions of veterinary care, locally owned practices often put their people first, and offer option-based and customized care to improve client satisfaction. When the business stays within the communities, everyone benefits.

Why now?

The veterinary industry is in the eye of a perfect storm fueled by factors, such as employee burnout and private equity buyouts, which are diminishing the number of qualified veterinary professionals. It is no surprise as jobs become less satisfying and less connected to purpose, professionals will leave an industry. Adding to those factors is a 2019 Centers for Disease Control and Prevention (CDC) study highlighting veterinarians are between two to four times more likely to die by suicide than the general population.⁶ A drastic solution needs to be found to save the veterinary industry from its current path, a roadmap that eerily mirrors human healthcare.

The worker cooperative model provides employees with a new level of governance, providing access, influence, and transparency to the intricacies of operating and growing a business. Employees are invited to take ownership and benefit from a company’s planned growth and success.

“This model will empower our team to drive the business forward while also making sure we’re benefitting through fair salaries, learning opportunities, and governance over our work environment,” says Mollyrose Dumm, client liaison at Urban Animal. “With nationwide staffing shortages at all levels of veterinary care, a worker co-op model will hopefully attract new staff as people see that we’re a company that takes the employee experience seriously.”

In forming a worker cooperative, practice owners can leverage a unique ownership model to attract professionals—those who currently work within the industry; those who may have left; and the next generation of veterinary professionals. A worker cooperative aims to create desirable jobs and workplaces governed by those who provide veterinary care versus those who have identified the human-animal bond as a profit center.

Cherri Trusheim, DVM, is founder and CEO of Urban Animal. Dr. Trusheim considers herself a social entrepreneur, optimist, and worker cooperative evangelist. In the fall of 2023, she spearheaded the start of transitioning her company into becoming a veterinary worker cooperative. For more information, please visit www.urbananimalnw.com.The opinions and conclusions of the author do not necessarily reflect the views of Veterinary Practice News.

What is a worker cooperative?

What happens when private equity is managing pet care?

Why now?

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