Where Responsibility for Financial Sustainability Lies

I often write about the unsustainability of university finances, the lunacy of its cost base, the fact that Canadian profs are better paid than in any public system of higher education in the world, etc.  Some people have concluded from this that I am hostile to labour, or to academic unions in particular.

But that’s not true.  Though I do call BS on some of the sanctimonious nonsense that comes out of academic unions on the beleaguered state of their (let’s face it) quite privileged members, I cannot, and do not, blame people for banding together and bargaining in their best interests.  If you want to blame anyone for our current financial predicament, try looking at the administrators who keep saying yes to labour’s demands.

Although things are slowly changing, we had a pretty serious agency problem on the management side of the bargaining table for most of the last twenty years.  While senior administrators are sometimes demonized as aliens feasting parasitically on the body of the academy, the fact is that most of them are academics themselves, and a fair number of them intend to go back to do more teaching and research at some point.  That puts them in a bit of a conflict of interest since there’s a good chance that they will eventually end up in the bargaining unit with whom they’re negotiating.  And it’s not as if they’re negotiating with their own money – if they give away too much, they can always lobby government for more money, or higher permissible fee increases, right?

It’s also astonishing how long it’s taken for management to get serious about bargaining.  Though not all members are equally appreciative of its methods, CAUT’s great success over the years has been to help its members bargain, and – perhaps more crucially – to provide big stonking cheques for strike pay to its members on the eve of work-stoppages (the million-dollar check Jim Turk sent to St. FX’s union on the eve of last year’s strike played an enormous role in the shape of the final settlement).  But university administrations haven’t kept pace, and so they get picked off one by one, and keep agreeing to contracts which, in the long run, are unsustainable without significant hikes in public funding, or tuition fees, or both – neither of which, you may have heard, is imminent anywhere right now.

Long story short: university finances are largely a mess, and rising labour costs are a significant part of the problem.  But no one made institutions sign those deals.  Going to government and pleading for special treatment now because they made dumb deals in the past?  That dog just won’t hunt.

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19 responses to “Where Responsibility for Financial Sustainability Lies

    1. Hi Brett. Thanks for reading. Good question – my impression (and it’s not more than that, I’m by no means an expert) is that because negotiations are centralized the admin side brings a little more talent to the negotiating table. And just because of the way they are run, College CEOs are a lot more alert to how non-financial clauses (e.g. on work rules) actually impact the bottom line – they;re looking to deliver many different types of programs and know they need flexibility in work rules to get it. Not sure the same can be said for unis.

  1. Indeed. Not to mention the fact that the vast majority of Post Sec. administrators are untrained. Primary school principals have more academic background in admin than most university presidents. Also, they all want to avoid the “taint” of a strike on their resumes. “Not on my watch” becomes the objective during the bargaining process from the management side of the table.

    1. Hi Robert. Thanks for reading. That is a related aspect I hadn;t picked up on so thanks for pointing it out.

  2. What a load of garbage this post is. Labour costs are rising? Not academic rank salary labour costs. Look at a graph of academic rank salary expenditures from the late 70s until now. As a percentage of costs at the uni level it has dropped by more than 10 percentage points, from over 30 percent to just over 20 percent. That statistic tells you a thousand times more than this uninformed nonsense from a (let’s face it…privileged) and overpaid consultant whose career is likely founded on repeating “truths” to people to already know what they want to hear.

      1. Having a salary over $100k puts you the same league as: police officers, electricians, plumbers and many others. OK we’re all “privileged” being in Canada as opposed to Somalia or Iran. But that’s a hot-button word suggesting that people are paid more than … what exactly?? What “privilege” are faculty exercising that an electrician making the same money is not?

        1. I think you’re overstating the average salaries in some of these fields. 100K plus puts you well inside the top 10 percent of income in the country.

  3. The angry exchange above is distressing, and unhelpful. Both the objector and Alex Usher are right, but the analysis necessary to address the difference is not being done.
    – Fact: professors’ salaries are quite good (yes, in the upper tier; full disclosure: I am one of those well-paid professors).
    – Fact: the proportion of university budgets taken up by salaries for academic ranks has been declining (as this blog has indeed shown). In fact, this is true also if one factors in spending for part-time teaching.

    What is distressing is to hear professors (again, of which I am one) complain about our salaries, and Alex Usher complain about labor costs being the main problem facing universities. In my view, both are wrong. The question posed at the start of Alex Usher’s earlier analysis of university expenditures was, I thought, the right one: where is the money going?
    – Is it administrative “bloat” (a growing army of vice-deans and vice presidents detached from academic functions but counted in the ‘academic ranks’)? + marketing; + external relations; + professional fees (consultants) etc.? This hypothesis was too quickly dismissed in the analysis, as it did not consider precisely what the CAUBO data was measuring. There is plenty of strong opinion on this, but no solid research for Canada (or does someone know of something I missed?)
    – Is it ‘pet projects’ (those new school-of-latest-fashionable-priority) that pop up everywhere?
    – Is it … what? Mr. Usher says research, but there also, too little consideration is given to what is being measured (and how those measures have changed over time).

    And on the salary issue, there is plenty of blame to go around. As the collegial management model has been eroded, Faculty Associations have become virtually the only avenue for faculty to be heard. But Faculty Associations are a blunt instrument. If what faculty want is more faculty, collective bargaining is not designed to get that. It is also common for administrations to buy peace with salaries. I am a member of a faculty association that recently almost unanimously voted to bargain for more positions, and a very small salary adjustment. It did not work: the administration was much more adamant about keeping “the union” out of staffing level issues, but was content to offer more in salary. So that is what we got. Sigh. No matter how high our salaries go, that does not give us extra time to deal with more students, more administrative demands, more committees, accountability reports, reform initiatives, upper-level pet projects, adherence to branding exercises, strategic visions …..

    1. Thanks for that. And a very interesting point re: positions vs. salary.

      Just one quick point, though. The fact that academic salaries were not the main culprit for cost increases in the period 1990-2010 doesn’t mean they aren’t the main culprit for cost increases now. I have a post going up on Monday which will look at that a little more closely.

    1. Thanks for that. For those who don;t want to click the link, it’s a discussion about how much electricians make on average. The answer is 52-70K.

      1. Yes, and with an average including starting electricians who make much less, necessarily there are many senior electricians who make much more, and relatively junior ones who work long hours who make much more. Lots of senior electricians make over $100k. You seem very resistant to acknowledging this fact, not that it’s terribly dispositive of anything. And you still haven’t told us what “privilege” a $100k prof is exercising that a $100k electrician is not exercising. I’d love to hear about it.

        1. The occasional senior electrcian earns 100K. The *average* electrician earns 52-70K. In comparison, the *average* tenure-track academic earn over 100k. That’s a pretty big difference.

          1. You are indeed correct about this claim that you have introduced into the conversation; for mine was not about averages, the point is just that saying a professor makes a lot because they make over $100k is just silly because lots of people do. Yes, average prof salary is greater than average electrician salary, but that was not your original point, it was something you refuse to elaborate on, namely, that there is some “privilege” the professor has that the $100k electrician does not have, and I’m still waiting to hear what it is. I know this idea that $100k is some obscene salary requiring special justification is the sort of thing that is grist for the Globe and Mail comments sections, but anyone who goes out into the real world and meets real people (e.g. a couple of electricians I met who clear $200k; cops who show up on the Sunshine List due to overtime pay) is not going to cry “PRIVILEGED!!!” when they find out that someone with a PhD is clearing $100k. It’s just silly, so I guess it’s not surprising that you refuse to elaborate on it.

          2. I used the word privilege in the sense of “this is a group of people who get paid extremely well – top 5% of income distribution or so – to do something they love, which is something very few people can say”. Is that enough elaboration for you?

  4. “privilege |ˈpriv(ə)lij|
    noun
    a special right, advantage, or immunity granted or available only to a particular person or group of people…”

    OK so you didn’t mean by “privilege” what the word actually means. What you meant by it is that being a professor is a good gig, and yeah you’re correct about that.

  5. Sadly, rolling the entire faculty into one bundle as a “labour cost problem” may ignore the actual composition of faculty by rank at Canadian universities. Let’s be honest: the UCASS system was pretty thin on good data, and CAUT’s annual almanac had to reprint the previous year’s data because of the pretty hopeless results of the voluntary StatsCan household survey. Although somewhat anecdotal because it seems no university would ever really want to collect or release these stats, approximately 50% of all courses are being taught by underpaid sessionals, many of them with PhDs, publications, etc., with an alarming proportion of them having been stuck in that purgatory for 10-25 years. Average salary of a sessional ranges from between $5,000-8,000 per course. If they teach two courses in a year, they achieve the dubious honour of being considered above the poverty line. What I would like to see is someone go after that data, find out how many sessionals/adjuncts there are, how many have to rely on EI summer after summer (if they clock enough eligible hours), and the like.

  6. Good point. However, I would add this, having experienced a strike at my institution (STU) and now watching one next door (UNB). The responsibility on the administration side to the students means that the faculty hold the advantage every time. We are always reminded that no Canadian university has ever lost a semester to a faculty strike. Why is that? At UNB, students returned to campus from all over the world, got settled in residences and classrooms, and a week later faculty were on strike. The administration had already offered more than it can afford (9.5 per cent over four years before step increases) to try to avoid a strike. As always, these fights seem to be over before they start. CAUT will arrive soon with a $1 million cheque. We’ve seen it all before.

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