Faculty Salaries Reflect Reality, Not Politics

Some University of North Carolina system faculty members are outraged. They have been given only one across-the-board raise since 2011. They, and their supporters, claim that salaries have been stagnating for years, that this stagnation is a slap in the face, and that the system is subjecting faculty to barely livable wages. Raises given to top administrators especially stoked their ire.

Yet they are leaving a great many facts out of their argument in order to strengthen their case. The absence of a state-mandated across-the-board salary increase does not mean that faculty members are not receiving increases. There are quite a few programs and procedures for raising UNC system faculty wages. One thing that may be angering the more strident faculty voices is that many of the means for raising salaries are merit-based rather than automatic.

And it would appear that few full-time faculty are eating at the soup-kitchen when their wages are compared to salaries at their peer institutions across the country and to the prevailing wages in North Carolina. Furthermore, just looking at average faculty salaries for UNC’s 16 public universities alone can be misleading, as these numbers don’t show how retirement, promotion, and targeted increases affect wages.

Chart 1: UNC Faculty Average Salary (All Ranks) and U.S. Median Household Income (2014 CPI-U-RS Adjusted Dollars)

Chart 1

Sources: Integrated Postsecondary Education Data System and Federal Reserve Bank

Indeed, as can be seen in Chart 1, the lack of wage increases is not a problem unique to UNC faculty and is not a sign of unfair treatment: in the post-recession economy, the median American household is struggling not to fall behind. Median household income for the entire United States has held constant or fallen since 2000. According to the St. Louis Federal Reserve Bank, which measures such statistics for the Federal Reserve System, median household income reached a peak in 2000 at $57,843, and was only $53,657 at the start of 2014.

And the great gain by faculty members in the years preceding the 2008 collapse, especially in relation to other wage-earners, should not be ignored. From 2005 to 2010, while median household incomes were falling by 4.7 percent, faculty salaries instead rose 6.3 percent.

To get a more comprehensive understanding of what’s happening with UNC faculty salaries, we must look at previous state-funded pools for salary increases, campus-funded annual raise processes, state allocations to the Faculty Recruitment and Retention Fund, and the wages of faculty at comparable schools across the country. For 2012-2013, the General Assembly approved a 1.2 percent across-the-board salary increase for all faculty and staff. Universities were also given permission to provide an additional 1.8 percent in merit-based and discretionary salary increases, which UNC-Chapel Hill and Appalachian State University did. A state-funded one-time $750 bonus, approved in September, will soon be distributed to both faculty and staff on campus.

For the 2014-2015 school year, the General Assembly appropriated $5 million for merit-based increases for faculty. The money was allocated proportionately to all campuses but came with guidelines from the Board of Governors that across-the-board increases would not be accepted. The following criteria were given to campuses when appropriating annual raises:

  • Individual meritorious performance, including teaching, service, publications, and/or research productivity for faculty;
  • Documented high-impact contributions to the work unit and/or the University as a whole;
  • Retention of key or hard-to-recruit personnel;
  • Secondary criteria such as equity and labor markets.

The board left specific processes and additional criteria to the individual campuses, granting a great deal of autonomy to the universities. These funds supported over 19,000 increases to faculty and senior administrators across the UNC system, averaging $3,478, according to Matthew Brody, the vice president of human resources in the UNC General Administration. 

In addition to the 2014-2015 state appropriations, many universities used campus-generated revenue to increase faculty salaries further:

  • UNC-Pembroke received $94,000 from the state and contributed an additional $450,000;
  • UNC-Chapel Hill increased all faculty salaries by $1,000 in addition to the state-funded raises;
  • North Carolina State University allocated a 3 percent pool for merit-based increases;
  • UNC-Greensboro used its share of the $5 million to grant 182 increases averaged at $1,699 each.

There have been multiple permanent merit-based increases in the 2015-2016 year as well:

  • UNC-Chapel Hill provided a 2 percent pool to all Deans and Vice Chancellors to distribute to faculty. So far, the university has awarded over 79 salary increases, totaling more than $2 million with an additional 50 rank promotions (presumably carrying a salary increase).
  • North Carolina State University allocated a 2 percent pool for merit-based increases.
  • Appalachian State University faculty will receive an increase of between 1.66 and 2.56 percent based on the average amount needed to reach the 79th percentile for assistant and associate professors and the 50th percentile for full professors.
  • Nearly 90 percent of faculty members at East Carolina University will receive a merit-based increase averaging 2.4 percent.
  • Western Carolina University plans to increase all faculty pay up to 77.5 percent of market value, with a $25,000 base salary for all positions.

The system appears to be undergoing a transition from across-the-board wage increases to individual merit-based raises. In many ways, this is a welcome change. It grants universities flexibility to strategically invest in faculty members and departments that are emerging or vital to the mission of the university. Consider that, had the $5 million allocated to increases in 2013 been distributed to all faculty employees evenly, each member would have seen an increase of about 0.2 percent, a mere drop in the bucket. Instead, it was used in such a way to make some departments stronger.

The North Carolina General Assembly created the Faculty Recruitment and Retention Fund (FRRF) in 2006 with the direction that universities could use the funds for “recruiting and retaining faculty members as necessary.” The state allocations to this fund are separate and in addition to the money authorized for the annual raise process. To date, the fund has enabled the UNC system to pay for 238 recruitment awards and over 318 retention awards, totaling more than $17,293,649.

Between 2012 and 2015, the FRRF saw a 76 percent increase for retention purposes (the Board of Governors has since restricted the fund to only retention requests). In 2014-2015, the average FRRF pay increase was $13,731. However, that amount understates the actual raises given to professors. For the past several years, the Board of Governors has asked the universities to provide matching support for such retention raises. When counting total increases, the average increase in salaries for newly granted FRRF awards in 2014-2015 was $20,050. The FRRF has apparently worked quite well, as indicated by its 92 percent overall success rate.

Although UNC faculty salaries have remained relatively constant, they have stayed above the national average. Looking at the chart below, ten of UNC’s 16 schools are above the national average for public, degree-granting, four-year universities. At a time when the supply of faculty labor far exceeds demand, it doesn’t seem likely that salaries will, or should, rise significantly.

Chart 2. Average Faulty Salaries, All Ranks 2012-2015

Chart 3

Source: Integrated Postsecondary Education Data System

Additionally, employees of the UNC system continue to stay ahead of the average North Carolina public sector employee, who averages $46,620 a year. For non-tenure-track “instructors,” the system-wide average is $58,735, and the individual averages remain above the public employee average at all but Western Carolina University and UNC-Greensboro.

Chart 3. Average Salary, Instructor Rank Faculty 

Chart 4

Source: Integrated Postsecondary Education Data System

One claim that faculty advocates often make is that universities are reducing costs by replacing well-paid tenure-track professors with non-tenured lecturers or adjunct teachers. Non-tenured faculty members generally have less job stability, smaller salaries, and are often passed over for merit-based increases. While there is some evidence of this as a national trend, in North Carolina the numbers do not support this pattern. From 2012 to 2015, there were a total of 1,829 faculty members hired. Of this total, 977, or 53 percent, were hired as tenure or tenure-track; this is far above the 34 percent national average. Additionally, less than 8 percent of new faculty members were given a less-than-one-year contract.

Table 1. Total Faculty Hired, All Ranks 2012-2015

Table 1

Source: Integrated Postsecondary Education Data System

Given all the raises previously mentioned in this article, it is not as if the legislature and Governors are ignoring faculty raises, as the issue is sometimes presented. Another move toward a more responsive pay system happened at the October 2015 meeting of the Board of Governors, when a system to streamline compensation decisions was proposed. The new process would raise the current 10 percent threshold that triggers a necessary pre-approval from the board itself. Under the new guidelines, the Board of Trustees and the Chancellor of the institution would have full control to raise faculty salary up to 20 percent in most cases and 30 percent for select actions, without pre-approval. This streamlined process would grant the universities greater autonomy in deciding faculty salary increases and FRRF allocations.

While it’s obvious that faculty member’s think they’re being treated unfairly, the fact is there are limited funds at the state and university level. Using this money for across-the-board increases would, at best, fail to make a meaningful impact and at worst, seriously threaten the system’s ability to attract and retain talented academics. Merit-based increases are the most efficient system of compensation for the UNC system.

Furthermore, there is nothing special about the academic professions that require pay raises when others aren’t getting them. In the current economic climate, we should expect some understanding on their part—they are, after all, supposed to be reasoned scholars—that the entire country is going through the same trouble or worse.