Greensboro College Cuts Salaries 20 Percent

Chris Lawrence passes along a News 14 report that North Carolina’s Greensboro College has imposed a 20 percent across-the-board salary cut.

Administrators explained Friday that eight people were laid off. Salaried employees will have to take a temporary 20 percent pay cut beginning May 1. “We wanted to protect our lowest paid employees, and we have a number of people, some 300 employees, and some of them are on hourly pay schedules, and these are people we did not want to be affected by this at all,” Greensboro College President Dr. Craven Williams said.

The cuts also include eliminating matching contributions to retirement funds. Dental insurance is being cut, the use of temporary labor is out, staff sabbaticals are suspended, and administrative stipends are reduced.

Dr. Williams said a 40 percent drop in endowment earnings, a $1 million drop in gift donations and a projected decline in enrollment for next year forced their decisions.

It’s an understandable move but one that will surely be harmful in the medium run. Unlike most jobs, where employees forced to take a salary cut can immediately start looking for another position and leave two weeks after finding one, colleges hire on an annual basis and it’s now too late to find a new tenure track job for the 2009-10 academic year. I’d expect Greensboro’s best faculty to spend much of the next year looking for a job at a more stable institution.

Of course, given the state of the academic job market — and the fact that private liberal arts colleges in nice settings get more than their fair share of applicants — there will be others to take their place. But for the next few years, at least, those with lots of options will likely think twice before signing on at Greensboro.

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James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. odograph says:

    Have you thought about this in the context of Deflationary Spiral?

    (Not a sure thing, but it’s not a good thing when news lines up in this direction.)

  2. Dave Schuler says:

    Dr. Williams said a 40 percent drop in endowment earnings, a $1 million drop in gift donations and a projected decline in enrollment for next year forced their decisions.

    I’m not sure what the college’s alternative was. Salary schedules are necessarily limited by the institution’s resources. That’s true whether the institution is a college, a hospital, or a city.

  3. James Joyner says:

    I’m not sure what the college’s alternative was. Salary schedules are necessarily limited by the institution’s resources. That’s true whether the institution is a college, a hospital, or a city.

    I think you make cuts in programs, maintenance, and so forth. This breaks a social contract with the faculty — and may in fact break a legal contract. Generally, faculty sign contracts in the spring for the upcoming academic year. And tenured faculty (I don’t know if Greensboro has them) are generally immune from future cuts in their salary, lest it be used as a backdoor means of firing.

  4. sam says:

    I think you make cuts in programs, maintenance, and so forth. This breaks a social contract with the faculty — and may in fact break a legal contract.

    The ‘and so forth’, of course, covers the school’s admin staff (secretaries, admin assistants, janitors, etc.) who are already taking it in the pay shorts big time. In one such school that I’m familiar with, underpaid hourly staff are being faced with the threat of mandatory unpaid furloughs. Needless to say, the school’s “executives” are trying to convince everyone that this, in lieu of having to cut their bloated salaries, is for the “good” of the institution. (The president of the school, with his ear in full tin mode, said, Gee, I’m going to take a two-week furlough myself. It won’t be so bad, I mean, I’ve got a book I can work on and some other things….)

  5. Triumph says:

    I don’t think Greensboro College is a real school–it’s likely one of those two-bit religious colleges you see throughout the South that outlaw dancing and make you take three semesters of New Testament studies.

    As the US gets more secular, this type of institution is bound to fail.

  6. odograph says:

    I mentioned news pointing in this direction, above.

    The University of California’s huge workforce could face salary cuts and furloughs if the state’s economy continues its downward spiral, UC President Mark Yudof has told his staff.

    Don’t miss the forest for the tree.

    Some companies cut pay, rather than jobs

  7. […] morning James Joyner notes that, Greensboro College, a small North Carolina college, has resorted to stringent measures to […]

  8. Steve Plunk says:

    Excuse me for feeling little sympathy. College costs have far outpaced inflation for decades. There’s substantial percentage of professors and instructors not worth minimum wage let alone a tenured salary. Administration is top heavy and full of nonsense like diversity officers and multi-cultural directors. The value of a college education is regularly questioned these days. I would say the old model is broken and some rethinking is in order. The ideas employment should be an annual “contract” and tenure are outdated as well.

  9. Boyd says:

    Explain to me again why schools are different from any other business?

    During the Great Internet Bubble Burst Recession early this decade, my then-employer forced a 20% reduction in salary on all employees. Those who didn’t like that (even if the company really wanted them to stay) were free to leave and seek employment elsewhere. Those who believed in the company and its ability to rebound, and could afford to make their own budget cuts to account for the reduced salary, stuck around. As did those who thought it sucked, but feared they couldn’t get employment elsewhere.

    Yeah, hiring at colleges tends to happen only once a year. That’s an aspect of their chosen field of employment. Sucks to be them. I’ve had my share of suckage, but my experience with college instructors is that they feel they should be immune to the real world.

    As I said, sucks to be them.

  10. Rick Almeida says:

    Generally, faculty sign contracts in the spring for the upcoming academic year.

    FWIW, at my institution, we have received promises of contracts contingent on state funding for the last 2 springs.

  11. Michael says:

    Those who didn’t like that (even if the company really wanted them to stay) were free to leave and seek employment elsewhere. Those who believed in the company and its ability to rebound, and could afford to make their own budget cuts to account for the reduced salary, stuck around. As did those who thought it sucked, but feared they couldn’t get employment elsewhere.

    So those that were worth the money left, and those that were not stayed. I think that’s why James believes this was a bad move. Whenever you make across the board pay cuts, the people you most want to keep are the first to leave.