Report of the University Senate
Budget Committee 2007-08
Update on the 2000 Senate Budget Committee White
Paper:
A Plan for Sustained Competitive Parity in
Instructional Faculty Compensation
May 14, 2008
The 2007-08 Senate Budget Committee
(Marie Vitulli (chair), Peter Keyes, Mike Kellman, David Frank, Suzanne Clark,
John Chalmers, Gordon Sayre (ex officio)) calls for the university to take immediate steps to bring our faculty's salaries up to the
average (mean) relative to our comparators. We estimate that this critical initiative will cost
approximately $10.2 million or less than 2% of the University budget.
Background
The University of Oregon has
long had a reputation for excellence in research and teaching, but that
hard-earned reputation is slipping.
Since the passage of Measure 5 in 1990, state support has decreased
substantially, tuition has risen, and the student/faculty ratio has increased
dramatically. The university's ranking in national polls has continued to
decline, while the classifications from the Carnegie Foundation now place the
UO in the second tier of research institutions (RU/H rather than the top RU/VH
for "very high" research activity).
It is a widely-anticipated that the UO may be expelled from the Association
of American Universities, because we no longer meet key metrics for membership
in that august association.
It is easy to lose sight of
the fact that the UO instructional faculty is the engine that drives this
institution. Faculty salaries
account for about 10.2% of the overall university budget,
it is this small expenditure on the teaching faculty that directly or
indirectly generates virtually all UO revenues, including tuition,
appropriations from the legislature, grants, and athletics. The core of the university is the
faculty, and this core has been badly neglected over an extended period, at
great peril to the future of the institution.
Average faculty salaries at
the UO have reached a point where many departments find it hard to attract new
faculty members, or must be willing to pay starting salaries that equal, or in
some cases, exceed the salaries of senior faculty members with many years of
valuable service to the institution.
New faculty members arrive with a relatively good salary, but quickly
see that for every year they stay, their career earnings trajectory is flat or
negative. It is vital to the
future of this institution that faculty see an attractive career path at the UO
and do not perceive the UO as a starter school, a place where one can gain
experience and but then must leave for a better professional life
elsewhere.
The vast majority of faculty
members make significant contributions in all spheres of university life
investing their energy, enthusiasm and intellect in the UO. The esprit de corps of the UO community
drew many people to Oregon but this asset must be nurtured by reciprocal
treatment that rewards the people who make their careers at the UO. It must be the first priority of the
administration to pay for the deferred maintenance on a corps which finds both
its checkbook and morale in shreds and tatters.
As a first step, the 2007-08
Senate Budget Committee recommends a modest goal which is to immediately pay
salaries to the faculty which achieve the mean relative to our comparator
institutions. This critical act of
good faith is required to reverse our downward trajectory and must be applied
uniformly across the professorial ranks, not just in aggregate. What this means is that research-active
productive faculty must see substantial across-the-board increases to address
issues of inequity and compression at the individual faculty level.
History
The crisis in faculty
salaries was first addressed by this committee in 2000. After the adoption of the 2000 SBC
White Paper, some progress was made toward the White Paper's goal of bringing
the total compensation of UO faculty up to 95% of the average total
compensation of our OUS peers.
This progress halted during the salary freeze years (2003– 2005)
and in fact reversed itself in 2004 – 05. Even though compensation progress resumed between 2005 and
2008, there was little progress in reaching the average salary of our
comparators; the increase in total compensation was largely due to an increase
in the costs of benefits. This trend of rising benefit values may soon reverse
itself, however, because new faculty are in the OPSRP rather than in PERS Tier
One or Two (the employer contribution rate is significantly lower in OPSRP),
and the PERS employer rate is falling as the economic forecast of PERS has
dramatically improved.
Tables 1 and 2 in Appendix A
give a brief synopsis of how UO faculty salaries compare to our comparators
since the original 2000 White Paper. We are most competitive at the assistant
professor level, since market forces demand competitiveness in order to hire
new faculty. The longer a faculty
member stays, the bleaker it gets, with full professors earning 81.4% of the
average salary of the eight universities selected by OUS as our peer comparators. This comparison understates the real
ratio, as our raises go into effect in January, whereas the raises of our
comparators go into effect in September or December of the previous year.
Since the adoption of the
White Paper in 2000, there has been widespread agreement on campus, among both
the faculty and the administration, that raising faculty salaries was to be one
of, if not the, top priority for immediate action. However, the data indicate that this goal has not been
translated into action. Table 3 in
Appendix A illustrates the percentage growth in faculty salaries, versus the
percentage growth in the university base budget for the same periods. Figure 1 in Appendix A looks at the
cumulative percentage increases in the UO base budget, the average salary and
the total compensation of a UO full professor, and the Portland-Salem CPI.
Not only has increasing
faculty salaries not been a priority, which would perhaps be indicated by a
percentage growth in salaries at least equal to the percentage growth in the
base budget, but faculty salaries have not even held their share of the budget,
increasing at a rate slightly more than half the rate at which the university base budget has
increased.
We recognize that there have been
many mitigating circumstances in this period, that the cost (while not
necessarily the benefit) of the benefits package has increased, that state
salaries have been frozen, that the administration has labored mightily to keep
the university afloat in what are (seemingly always) tough times. But this does not change the fact that
the faculty have actually lost ground.
If the percentage growth in faculty salaries had simply matched the
percentage growth of 59.8% in the university base budget, we would already be
at 95% of our comparators' salaries.
Recommendations
1. The 2007-08 Senate Budget Committee
recommends that we aspire to reach the median salary of our comparators,
without letting our total compensation slip, in the next academic year.
2. While meeting this goal in aggregate
dollars in the salary pool is important, it is equally important that issues of
salary compression and inversion be addressed substantively. The 2007-08 Senate Budget Committee
recommends that the central administration make solving the compression and
inversion problem a top priority.
3. The magnitude of the salary problem
can be expressed globally, but it is experienced individually and
unequally. Some faculty members
may have salaries that are appropriate, given their rank, experience and
relationship to market forces; many faculty have salaries that are woefully
inadequate according to these same criteria. Any implementation strategy for salary improvement must
address these individual circumstances, and we must not allow significant
salary increases directed at a relatively few individuals convince us that we
have solved the overall problem.
Therefore, the Senate Budget
Committee recommends that each unit or department on campus draft an "Equity
and Compression Plan", which would show how their faculty salaries, either
individually or by rank, compare to the salaries of their peer institutions and
departments, and how increased salary funding would be distributed to achieve
specific salary goals. These
Equity and Compression Plans would be reviewed by the Provost's office (in
consultation with the Senate Budget Committee) for compliance with the
generally agreed-upon criteria and goals.
This process mirrors that put
in place two years ago by the University's Diversity Plan, which recognized
that broad goals may be set at the institutional level, but that individual
units and departments have different circumstances and needs, and that
implementation strategies are best developed at the decentralized level.
With the upcoming change in
the university budget model, it is imperative that the administration aid
schools and units come up with the funds to address faculty salaries. This is
going to take an additional $10.2 million allocated to faculty salaries per year.
There is an expected enrollment increase of 200 students in fall 2008
generating at least an additional $1.2 million in tuition. There are additional allocations from
the legislature for faculty salaries and for improving the Student/Faculty
Ratios for the second year of the biennium totaling $4.3 million. If the state compensation (COLA)
dollars are released there will be another significant source of funds that can
be allocated to faculty salaries.
These sources will help match the projected raises of our
comparators. There must be an
additional source of funds if we want to start closing the gap.
4. It is critical that we
regularly monitor our progress in achieving this new goal. We recommend that the administration
report back to the Senate Budget Committee in April of each year giving details
of average UO and comparator institution average faculty salaries (by rank) and
outlining the progress various campus units made towards achieving the goals of
their Equity and Compression plans.
This information will be posted on the SBC website.
Further Action
In this report, we have
focused upon the scale and broad parameters of the situation, rather than on
offering specific solutions. We
recognize that the specific insights, expertise and experience of many of our
colleagues in the administration are critical to the success of this important
initiative for the university, and we look forward to working closely with them
to achieve its implementation.
However, to move the dialogue in a more concrete direction, we mention
below three of the many possible approaches to addressing the faculty salary
crisis:
1. If faculty salaries are truly a priority to the
institution the central administration should find $10.2 million to devote to
faculty salaries starting in 2008–09. The money can come from combining
appropriations from the legislature with a reallocation of tuition and RAM
dollars and a concerted effort to increase foundation funding for meritorious
faculty.
2. Over the next few academic years the average faculty
salary increase should be determined by rank. The raises must be above the average raises of our comparators. The UO must supplement the average comparator raises for full, associate and
assistant professors and instructors by 5.0%, 4.0%, 0.9%, and 2.9% each year achieve mean of our
comparators salaries by 2010 – 2011.
3. In addition to the customary COLA and merit increases,
reallocate 1% of the prior year's base budget (tuition dollars, RAM dollars,
and lottery funds) to faculty salaries each year until parity is reached. For
2007 – 08 this would have meant an additional $2.7 million for faculty
salaries. The next year the 2.7
million would roll over and another $3 million would be reallocated to faculty
salaries, assuming modest growth (10%) of the base budget. It would take 3 years for all ranks to
reach the mean of our comparators with this approach.
Appendix A.
