The state of the physician workforce in 2025: 4 trends to know

A few weeks ago, we published a deep dive on shifts in physician employment models. The link to the full post is below for those who want a refresher, but long story short: the march toward employment continues, with some subtle differences in where and how fast the shift is occurring. Today, we’re back to explore the bigger picture: the evolving state of the physician workforce in 2025. We'll talk about what's driving physician workforce challenges today, and what leaders should anticipate moving forward.

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Missed our post on the ongoing evolution in physician practice structure? Catch up by clicking here or on the image below.

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The physician workforce in 2025 is a top strategic priority for medical groups

Physician workforce engagement remains a top strategic priority for medical groups. Persistent challenges like burnout and turnover—made worse by the pandemic—and new pressures—from demographic shifts to the rapid integration of AI—are reshaping how physician employers think about workforce planning.

Below, we break down four critical trends shaping the future of the physician workforce, as well as our take on the likely short-term impact of each of those trends.

Trend 1: Despite some modest improvements, burnout and turnover are persistent challenges—and the physician shortage is becoming very real

Let’s start with the obvious: burnout, turnover, and shortages continue to plague the physician workforce. Some metrics have improved slightly from the extremes experienced during the pandemic, but are still falling far short of where leaders would like to be.

• Burnout: Nearly 50% of physicians report feeling burnt out—down from the pandemic-induced peak of 63%, but still alarmingly high. Physician survey data indicates that burnout is fueled by a combination of high patient volume and administrative burden from increased documentation requirements and spiking prior authorizations and denial rates.

• Turnover: Burnout is a key driver of turnover, so it's unsurprising that turnover rates also remain high. From 2022–2024, about one in five providers in U.S. medical groups were new to their practice, signaling sustained churn. An aging workforce with more physicians reaching retirement age is compounding the problem, with roughly 10,000 physicians retiring each year. (We’ll take a closer look at the implications of retirement later.)

• Shortages: Estimates project a shortage of up to 86,000 physicians by 2036. While we've long believed that shortage estimates were potentially overblown (and more reflective of uneven distribution than true, national-level shortage), our own conversations with medical groups indicate that shortage issues are becoming more and more pervasive across geographies. And looming shortages mean that other issues are unlikely to resolve on their own: shortages further erode morale, driving burnout, turnover, and ultimately contributing to even more shortages.

What's next?

These challenges are likely to exacerbate access bottlenecks: average patient wait time jumped from 24 days in 2017 to 26 days in 2022. A more recent study (conducted by a separate source) suggests that the problem may have only worsened since then, pegging the average wait time in 2024 at 38 days. While access challenges cannot be solely attributed to workforce challenges, physician engagement (and potential shortages) undeniably play a role and left unresolved, will undoubtedly worsen the problem.

Employers are increasingly looking to address the root causes of burnout and turnover by going back to the fundamentals and redefining their employe value propositions (EVPs). While potential increases in compensation (or changes to the compensation model) are a part of these conversations, there is growing recognition that non-monetary considerations (particularly working conditions and flexibility) are increasingly important—both to physicians themselves, and to medical group leaders who are financially-constrained. Focusing on non-comp factors also has the advantage of helping employers differentiate themselves more easily in a competitive labor market without creating a "race to the top" on compensation.

Trend 2: Physicians have begun to unionize—and unionization is likely to be a permanent fixture moving forward

As anyone in healthcare will know, physician unions have long been a rare phenomenon—but that’s starting to change. Between 2023 and 2024 alone, physician union petitions surged almost 900%, nearly matching the total number filed over the previous 20 years collectively. And it’s not just that there are more filings. Physicians appear to be following through in greater numbers: 77% of recent physician union petitions were certified, compared to just 55% between 2000 and 2022.

There are a few reasons for this sudden uptick:

• Increase in corporate employment: We covered the shift to employment in our previous blog post. Today, more than 75% of physicians are employed by larger entities. With that shift comes a very practical reason for higher unionization levels: eligibility. Physicians who work primarily as independent practitioners or practice owners are not eligible for union representation under the National Labor Relations Act (NLRA) due to antitrust laws that prohibit independent contractors from collective bargaining. But the rise in corporate ownership means that more physicians are now considered employees and are therefore eligible to unionize. Corporate ownership has also led to a growing sense of lost autonomy among physicians. Unionizing is seen by many as a way to potentially reclaim influence over working conditions and care standards.

• Increasing burnout and dissatisfaction: The rise of physician unionization is also a signal of the aforementioned dissatisfaction among the physician workforce. Unionization can be a tool to negotiate for better working conditions, manageable workloads, and improved staffing models.

• Generational shifts: We’ll cover generational shifts in more depth in our next trend, but evidence suggests that younger generations put more emphasis on work-life balance and personal well-being. They are less likely to accept the status quo and view unionization as a tool to change their working environments.

What's next?

We expect union activity to become a permanent fixture of the physician landscape, especially given that medical residents lead many of the current organizing efforts. While compensation is a key concern in physician union activity, non-financial demands like clinical autonomy, patient care standards, and influence over operational decisions are just as prominent. For example:

• At Mass General Brigham, 300 primary care doctors petitioned to unionize in response to chronic understaffing, rising burnout, and a shortage of resources—particularly mental health support—that hinder their ability to provide comprehensive patient care.

• At the University of Washington, the Resident and Fellow Physician Union–Northwest (RFPU) organized to address the physical toll of long shifts, successfully winning pregnant residents the right to decline 24-hour duty, a move aimed at protecting both provider and patient safety.

• At the University of Miami’s Leonard M. Miller School of Medicine, the Committee of Interns and Residents (CIR) fought for and secured additional pay and structured planning to address the unique strain and disruption residents face during hurricane emergencies, ensuring they are better supported during crises.

In many ways, preparing for the rise of physician unionization is similar to addressing burnout, turnover, and shortages. Leaders should proactively engage with physicians, assess concerns about workplace conditions, and invest in sustainable staffing models and support systems—an approach that is very much in line with redefining EVPs.

Trend 3: There’s a growing generational divide among physicians (but flexibility is a common denominator)

Like the U.S. population as a whole, the distribution of the physician workforce now resembles an hourglass, with many senior and junior physicians, and fewer mid-career providers. And the two “bulbs” of the hourglass—Baby Boomers at the top, and Millenials/Gen Z at the bottom—differ in their preferences and working styles:

• The Baby Boomers are at or near retirement. They’re experienced, mission-driven, and often skeptical of rapid change—especially when it comes to technology. This can cause tension with their younger patients who expect more-digital first care interactions, like the option to direct message with their physicians.

• Millennials and Gen Z physicians are more likely to view medicine as a job than a calling, are generally more tech-savvy, and place heavier emphasis on work-life balance. There’s a common perception (warranted or not) among medical group leadership that at least some younger physicians don’t want to work as hard as older generations.

Despite their differences, both ends of the "hourglass" demonstrate a clear and consistent preference for greater flexibility, even if their motivations in seeking that sense of flexibility vary slightly: Younger physicians are generally seeking flexibility as a means to achieving greater work-life balance, while older physicians are looking for a more gradual "off-ramp" to retirement.

What's next?

Employers will need to find ways to accommodate growing demand for flexible working conditions—and an increasing number are already offering part-time options. While likely necessary for recruitment and retention purposes, this approach does also have the potential to further strain productivity in a time when access challenges are increasingly rampant. Solutions like job-sharing and hybrid in-person/virtual roles will be critical to protecting against further deteriorations in access, while still offering the types of flexible working arrangements that physicians are seeking.

Trend 4: Physician adoption of AI is increasing even more quickly than expected—and AI a missed opportunity for physician engagement

Physician usage of AI nearly doubled in one year—from 38% in 2023 to 66% in 2024. And over a third of physicians say they feel excited about AI’s potential. This represents a drastic shift from a few years ago when survey data indicated that physicians were by and large reticent to the the concept of AI in their workflows. Some of that previous hesitation stemmed from the fear that AI would replace physicians—a fear that has largely dissipated (comments and headlines from non-healthcare experts notwithstanding). And growing familiarity with AI—coupled with the burnout associated with the growing administrative burden of practicing medicine—have further piqued physicians' interest in the use of AI.

What's next?

While there’s plenty of hype around potential clinical use cases of AI, administration use cases are the typical starting place for most physicians—and that will likely continue to be true in the near term. Administrative use cases are a natural starting place both because they’re lower-risk, and because they have the potential to directly address the leading cause of physician burnout: administrative burden. In fact, 57% of physicians identify reducing administrative burden as the biggest opportunity for AI in healthcare.

In particular, ambient listening solutions for clinical documentation are gaining popularity among medical groups of all types. In 2025, 42% of medical group leaders said they used some form of ambient AI solution. And early evaluations of ambient listening are promising, with physicians reporting the tools "reduce the burden of after-hours clerical notes" and patients reporting "improved interaction with physicians" because physicians aren't spending the whole visit looking at their computer screens.

Despite the stronger-than-anticipated interest and early promising results, leaders/employers may be missing an opportunity to engage physicians in AI-related decisions. Currently, over half of physicians report having limited input on decisions related to identifying and picking potential AI solutions. Given the high costs, inherent risks, and desire for consistency across organizations, the default to top-down decision making isn't entirely surprising—especially with more corporate employment. However, excluding or limiting physicians from AI-related decisions could negatively impact physicians buy-in and the overall success of AI-based applications.

Including physicians in AI decisions is similar to including them in other strategic initiative. Potential steps could include:

• Providing ongoing education and training about AI’s potential.

• Including physicians in early stages of decision-making and solution testing. (Too often we hear from physicians that they're "included” but only once a solution has already been implemented—that’s too late to get any meaningful feedback.)

• And, of course, establish many feedback channels to enable continuous learning and iteration on AI-based solutions.

Parting thoughts: Is it possible to both engage physicians and maximize productivity?

Employers are going to have to work to address the evolving challenges and opportunities within the physician workforce against the backdrop of rising physician expenses. This tension is particularly acute for independent groups and health system-owned medical groups: labor expenses already account for about 60% of a a typical health systems's budget, and those expenses are only climbing. Between 2021 and 2023, physician labor costs increased by more than $42 billion, an increase of about $304,000 per physician. Physician practices saw a median per-physician expense of $1.2 million for April 2025 on an annualized basis, up nearly 20% from 2023.

These rising costs have begun to erode hospital margins, in the wake of what appeared to be a post-pandemic stabilization in 2024. Despite year-over-year growth in gross revenue, hospital operating margins remained stagnant in April 2025 because both labor and non-labor expenses continue to increase, and margins in 2025 have thus far been notably lower than 2024 levels.

The stakes (and costs) are high—leaders quite literally can’t afford significant missteps.

Want more on this topic?

• We'll be discussing the physician workforce at our upcoming Central U.S. Insight Summit. Members can learn more about the summit and submit a registration request on the event's landing page. Not a member? Schedule time with us to learn more about how to join, and what's included in membership: https://www.unionhealthcareinsight.com/overview.

• Stay tuned for an upcoming blog post going deeper on the state of health system margins. Sign up for our newsletter at the bottom of this page to make sure you don't miss a future post.