Salary Increases: How to Do It?
Sanjay Paul

The article appeared in The Etownian, Feb. 13, 2010.

The big thing in academia is salary increases. (The other big thing is outcomes assessment — see Jan. 28 issue.)

Suppose you are the president of a college, say Ecity College. You wish to make sure your faculty are being paid well. After all, if they are not, their morale goes down, they start looking for work elsewhere and they may even pass motions in faculty meetings. All very unpleasant — no president wants that.

So, you compare data on salaries, your own college’s with those paid by similar colleges. Fortunately, such a database exists — the Chronicle of Higher Education provides data on salaries for more than 1,200 institutions. But not all institutions are comparable; salaries at research universities are very different from those at two-year colleges.

Ecity comes under Baccalaureate Institutions (also known as the AAUP IIB category). There are 425 colleges in this category, 43 of which are in Pennsylvania, and includes colleges such as Elizabethtown, Dickinson, F&M, Gettysburg, Juniata, Lebanon Valley and Albright. A wide range.

Data on salaries are reported by rank, so that you can see how Ecity’s full professors stack up against other full professors, your associate professors stack up against other associate professors, and your assistant professors stack up against other assistant professors. You sit down to compare the numbers:

“Oh, crikey!” you say. Ecity’s faculty are underpaid. You want the average salaries at Ecity to be close to the 95th percentile in each rank.

But the disparities are large. Full professors’ salaries are falling short by $37,000, associates’ by $18,000 and assistants’ by $13,000. Clearly, Ecity’s full professors are hurting the most; they have the most catching up to do. So, what to do?

You decide to augment the full professors’ salaries by $10,000 each year. You will give each of them an extra $10,000 annually, and over the next three years, the salary gap for Ecity’s full professors will shrink. Oh, good.

But then, you wonder, how about the other ranks? What do I do about the associates and the assistants? Should I not increase their salaries as well to get closer to the 95th percentile? You turn to your budget manager.

Nope, she says, you cannot do it. You don’t have the money. After you pay each full professor $10,000, there is no money left in the compensation pool for the others.

“What,” you cry, “not even for a middling across-the-board increase? Say, two percent for all faculty? How about at least a one-time payment of $500 for all?”

Nope. The budget manager is clear: There is no money left, unless you want to cut funding for financial aid.

“Ah,” you say, “let’s forget about the across-the-board raise. Just do the $10,000 increase for the full professors, and nothing for the other two ranks.”

But soon you begin to ask, why should we use the 95th percentile as the basis for comparison? So what if our salaries are not within the top 95 percent of salaries in our comparison group? What if we use the 80th percentile, or even the 75th, as the yardstick? Perhaps a more feasible goal might be: Ecity’s faculty salaries should be higher than those paid by 75 percent of institutions in our category. (You wonder briefly what your closest rival, Elizabethtown, uses.)

You sigh. Changing the salary yardstick will not be an easy sell. Some faculty will regard it as tantamount to treachery. How dare the president seek to reduce their salaries? But you see the problem with the current system: since the salary gap is largest for full professors (and smaller for the other two ranks), any adjustment made to reduce the gap will involve giving the highest raises to your highest paid faculty. And this at a time when nobody else is getting any raise at all.

You are the president. What will you do? Not for the first time, you say to yourself, “Uneasy lies the head …”

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