All things considered, it could be worse—much worse. According to Hearing Industries Association (HIA) statistics released in late July, total net hearing instrument units dispensed in the United States during the second quarter of 2008 increased by 0.8% (for a total of 629,002 units) compared to the same period last year. This was largely as a result of a 9.5% sales increase in units dispensed by the Department of Veterans Affairs (VA), which makes up about 15% of the market. However, private sector unit sales, a better reflection of sales for the “average dispensing office,” fell off by only a half-percent (-0.6%).

The 0.8% total unit increase is slightly lower than the 1.1% increase for the first quarter, which was also bolstered by strong VA dispensing from January to March (a 7.3% increase). Private sector sales in the first quarter were flat (0.1% increase). When the two quarters are added together, the market has experienced growth of 0.9% in the first half, and the private sector has witnessed unit sales almost identical to last year (a difference of about 3,000 units).

What does it mean? At the risk of sounding like a Pollyanna, it’s not great news, but in view of the circumstances, it’s pretty good news. Many of us had expected a 2%-3% decrease in Q2. Although it should be acknowledged that the HIA figures are rosier than comments heard from some manufacturers, the hearing instrument market (so far) is showing resilience in the face of terrible economic conditions that have included $4+ gas, rising food prices, and a plummeting stock market—all forces that might be expected to depress the spending habits of seniors.

As pointed out in a recent editorial (“Are We Recession Proof?“, February 2008 HR), it has been thought for a long time that the hearing health care field is more resistant to recessions than most industries. According to 2006 HR Dispenser Survey data, more than half (55%) of all dispensers’ customers are age 65 or older, and about two-thirds (65%) are retired or unemployed—people more likely to have fixed incomes and safer investments. Additionally, hearing aids are somewhat unique: once people go through the typical 7 years of denial and finally accept that they need the devices, they often view them as a requirement for independent living rather than a discretionary spending item.

Current technological advances may also be buoying the market. The hearing industry is experiencing a wave of innovation and changes in its basic product offerings, and this may help to generate greater consumer interest. Mini-BTEs, open-fit, and receiver-in-the-canal (RITE) technology have radically changed the landscape of hearing care; by some estimates, about 42% of all the units dispensed last year were open-fit mini-BTEs. BTEs constituted 57.6% of the market in the second quarter of 2008, up from 55.2% in the first quarter (a 12.6% increase). By comparison, they accounted for 19.0% of the market a decade ago, according to HIA 1998 statistics.

These and other innovations have added some pizazz to our industry’s products, as they’ve come to resemble “cool” cell phones (or is it the other way around?). It’s a frequent occurrence to see someone walking down the sidewalk with a wireless device attached to their ear—and it’s hard not to notice that the device they’re wearing is larger than our BTEs and they’re not hiding it. HR has devoted entire issues to Bluetooth and wireless hearing aid technologies. Likewise, this month’s edition of HR features two new designs from ReSound and Siemens Hearing Instruments that involve placing the microphone or processing unit in the cymba of the concha.

The jury is still out on the potential for mini-BTEs, open-fit, RITE, or wireless products to attract a younger population of hearing aid users, driving down the average first-time purchaser age below its current age of 70. However, what isn’t in question is that there are now cosmetic, communication, and fitting features offered by these products that were impossible a decade ago. And, one way or another, these will bolster hearing aid sales.

Karl Storm
Editor-In-Chief