Professors’ Salaries

Yesterday, Alex Usher blogged at the Globe and Mail’s web site about the salaries of Canadian university professors. He argues that professors in Canada are now paid better than professors in the United States. He also suggests that, in Canada, “professors are getting world-class pay without producing world-class results.”

While I’ve never argued that tenured Canadian university professors are underpaid (contract instructors are another story, of course), I do have three concerns about Mr. Usher’s position.

First, his argument isn’t as strong when and if the loonie drops in value down the road.

Second, even if the case can be made that Canada’s professors are better paid than their American counterparts, that doesn’t suggest to me that Canadian universities should necessarily change course. Good remuneration for university professors should be seen as a good thing, not a bad thing. 

Third, there’s a long (and increasingly expensive) road required of a young person to obtain a PhD, and then hit the job market, and then take on contract jobs, and then (hopefully) obtain a tenure-track job as a professor, and then get tenure. In fact, 50% of people who start a PhD in North America never finish. Moreover, when student groups raise concern to politicians and senior university officials about rising tuition and student debt, they’re often told to stuff it because, when they graduate (they’re told), their earnings will be higher on account of their degrees. Surely, if we want good people to persevere and become professors, we should try to have well-paying jobs for them at the end of that tunnel.

I think my professors are worth what they’re paid. And I’m not just saying that because they read this blog.


  • Good points, Nick.

    But let’s face it: the vast majority of research in economics and other social sciences is utter trash that is extremely distant from the needs of the real world we live in.

    For that money is there a way we can get our brightest minds working on topics that get us out of the deep crises we are in? Not sure what the answer is because academic freedom is important, but look where laissez faire social science has left us. Most PhD economists are dangerously clueless about the real world.

    I don’t think that’s too much to ask, even for just a few decades, then profs can get back to the intellectual masturbation of the global conference circuit.

  • The way I see it, the biggest problem with Canadian universities today is that they are being shifted to a corporate model with grossly overpaid (and unaccountable) administrators and executives. The top 5 people at the University of Alberta make something like $2-3 million total and faced no pay cut while the university plunged into deficits recently and forced all academic departments to cut spending and many faculties implemented student taxes to circumvent Alberta’s law regulating tuition increases to CPI.

  • The educational field,be it university,secondary or primary are all over paid.To much money is consumed by salaries, benifits,and pensions.
    I have three children ,two recently graduated from university and the third is currently attending a ontario university.All have indicated that the standard of educator was marginal.Some professor had poor command of the english language, hence understanding their lectures was impossible.Three hour classes where cut in half because the professor could not last or was ill prepared.
    IT APPEARS that it is a typical government philosophy.Lets demand high compensation for the least amount of effort .

  • Nope Nick; we’re overpaid! Sad to say, but I think few would quit if salaries were a little lower. And those that did quit could usually be replaced by equally good hires.

    What surprises me is the “false consciousness” of many university students on this question.

    Simplifying drastically, by ignoring overhead costs, the money per student x the number of students in the average class must be enough to pay for the professor teaching that class.

    After some clever mathematical economics we can deduce that:

    average class size = $ per prof/$ per student

    So, if $ per prof goes up, either $ per student must go up, or average class size must go up. Neither of which the student wants, either as student or as taxpayer.

    Ian: trouble is though, very few people *want* the job of university administrator.

  • Nick Rowe is correct that students pay a huge part of professors’ salaries – at Carleton, students pay for more of the operating budget than all levels of government combined. That said, Dr. Rowe’s attempt at ‘simplifying drastically’ creates a model so drastically simple as to lose its relationship with reality.

    I would love for someone to show I’m wrong, but let’s take a look at the budget for Carleton’s current fiscal year ( I’m not an economist, but it would appear that Carleton’s forecast budget is $312,937,000. Of this, $113,243,000 is budgeted to be transferred to the faculties and salaries will comprise a portion of this amount. Let’s add the staff benefits allotment from the ‘University budgets and transfers’ line – $36,037,000 – to the transfer to the faculties and we get $149,280,000. This is the amount that pays for a range of things including faculty salaries, and it represents 47.7% of the university’s total budget. Even if 100% of allocations to the faculties went to paying faculty salaries, the portion of the budget going to salaries is still well below 50%.

    Unless I’m making a major error, the idea that faculty salaries are responsible for large class sizes seems rather spurious. Rather than focusing on faculty salaries, perhaps it would be more worthwhile to look at where the rest of the money is going.

  • Dear St. Rowe,

    I am deeply touched by your rigorous attempt to argue that university professors are overpaid. Your comments about student false consciousness and your clever mathematical deductions are made all the more impressive by their complete lack of empirical grounding. It is painfully clear that you have never actually read Engels and that you assume by stating that you are ‘simplifying drastically’ gives you license to ignore even the simplest components of a complex issue.

    So what happens if we introduce a few more variables into your simple mathematical deductions? Let’s take Carleton University as a single unit sample: domestic undergraduate tuition is $6041.35 for two terms (fall and winter) for a student in Arts and Social Sciences (tuition can be as high as $8509.35 for a student in Engineering) – assuming a full course load of 5 classes per term that works out to $604.13 per course. Now, let’s take an introductory Sociology class with a maximum enrollment of 454 students (yes, classes can be this large as I was a teaching assistant for this course last year). Now, with 454 students at $604.13 that works out to $274,275.02 for that one course alone (not including provincial transfer payments for each full-time student registered at Carleton but that’s another matter completely). So let’s deduct teaching costs – $6237.00 for a contract instructor and approximately $38,472 for 8 Teaching Assistants (8 TA’s is generous and it should be noted that introductory courses in Sociology are almost exclusively taught by precariously employed contract instructors). This leaves $229,566.02 for the overhead costs that St. Rowe chose to ignore – including the administrative costs for support staff, building maintenance, energy costs, and of course, payment for the senior administration. Granted, not all courses are this large and some of these funds must go towards the teaching costs of other courses. But let’s consider that for a moment.

    Assume a 4th year seminar with an enrollment of 20 students (another generous assumption). Keeping the numbers the same, tuition would provide $12,082.60. Now, if we take a generous estimate of a tenured faculty member making $120,00 per year and teaching four courses that equals $30,000 per course so long as we ignore the long list of other requirements of a tenured faculty member including research, departmental committees, supervising graduate students, etc. So even if we make up the $18,000 difference between a first year course and a fourth year seminar, there is still $210,000 left over for all the other costs. The clever formula of ‘average class size = $ per prof/ $ per student’ offered by our fearless economist St. Rowe now seems academically irresponsible and deeply inadequate for any serious consideration of class size, tuition fees or the salaries of tenured faculty.

    If we go beyond smelling the surface as St. Rowe invites us to (he dares not even scratch the surface) and begin looking at the salaries themselves, something else becomes painfully clear. Keeping Carleton as a sample case, there are 33 employees who make more than $150,000 per year (I chose an arbitrary salary base to help St. Rowe and his followers to follow along). Of those 33 employees, 17 are faculty, 15 are senior administrators -Deans, VP’s of this and that, the president; the 1 remaining is a professional librarian. Of these 17 faculty members, 7 are in the business school, 3 are in engineering, 3 are in arts and social sciences, 2 are in the natural sciences and 2 are in public policy. The average salary of the Business professors making more than $150,000 a year is $182,919.40 with 3 of them making more than $200,000 per year. The average for the 3 Arts and Social Science professors is $157,262.54 with none of them making more than $167,000 per year. For the 15 administrators, the average salary is $219,168.39 with 4 of them making more than $200,000 per year and topping out at the President’s salary of $358,468.53. However, so as not be accused of misleading figures, 2 of these 15 salaries include severance pay for a past VP (research and international) at $503,247.70 and an interim President at $346,410.70. Regardless, these salaries are still for senior administrators and are still listed in the provincial salary disclosure document and have been included for that reason.

    So what conclusions can be drawn from this drastically simplified analysis of St. Rowe’s powerful critique of Nick Flavo’s posting? One, yes some professors are overpaid but they are primarily in the business and commerce departments. This is often explained away by ‘market logic’ wherein universities are forced to compete with the private sector for ‘talent’. A further corollary is that students in business and commerce programs pay higher tuition, are making a more ‘substantial’ investment in their future (hedging against potential future earnings) and thus it can be justified paying their professors higher salaries. If St. Rowe is correct that we could pay faculty in business and commerce less without sacrificing quality, then by all means the university should begin purging these bloated salaries from their payroll.

    Two, while some professors rake in substantial salaries, the highest salaries obviously go to members of the senior administration. This is an increasingly common trend for university bureaucracies – to grow large at the top, to commit more in wages to these ‘precious’ positions while that the same time working to limit tenured-track faculty and rely more on contract instructors. Some universities in Canada are ‘teaching-intensive’, some are ‘research-intensive’ but all are now becoming ‘admin-intensive’. But what if the great wisdom of St. Rowe is correct and that nobody wants these positions? How could we explain their growth in numbers? Obviously we couldn’t, not even with the leaps of logic possessed by our faithful economist. What we could argue, instead, is that if no one wants these positions, then we should eliminate them. We could operate the university on a more co-operative basis with greater input from faculty, staff and students (you know, the people who are actually affected by the decisions made by senior administration). We could offer teaching releases for tenured faculty, addition vacation time for staff and more scholarships for students who take seats on the co-opt operating committee and we could pay for all of it with the money saved by cutting senior administrative positions. In fact, by rough calculations we could even save several hundred thousand dollars each year!

    Three, rather than focusing on the salaries of professors it would be more effective to address the causes of ‘market logic’ in the university sector more generally and to examine how the transformation of education from a public good to a private commodity harms the integrity of post-secondary education and negatively impacts the budgetary considerations of university operations. This, to be sure, goes far beyond anything St. Rowe offers us. But without due attention, changes to the operation and nature of university education will progress towards more corporate organizational forms, relying more on out-sourcing basic functions like recruitment and teaching (Carleton is currently exploring a possible deal with a corporation called Navitas to do exactly this for international students) and replacing tenured faculty positions with precarious contract instructor positions all the while increasing class sizes and encouraging everyone to do more with less.

    This takes me to my final point: if our humble economist Mr. Rowe believes he is paid too much, maybe he would be willing to give a little back. He could take what he thinks he should be paid, subtract that from what he is actually paid and divide that remainder amongst the students registered in his classes. In fact, I would encourage any professor who believes that he or she is paid too much to begin giving money back to the students in their classes who are well aware that they are paying too much. I don’t suspect that any professor would actually begin cutting cheques to their students, but if one day a professor does, you can thank the generous Mr. Rowe for paving the way!

  • Here is my post on the subject.
    “If Canada’s Academia is a monster, then what are education consultants?”

    It would be great if some of you resubmit your comments there. Meades’ is very good.

  • James: “I don’t suspect that any professor would actually begin cutting cheques to their students, but if one day a professor does, you can thank the generous Mr. Rowe for paving the way!”

    You don’t? I know many professors who have done just that, and have been doing it for years. Scholarships and bursaries. More should.

  • Nick you say overpaid and I wonder compared to what? On an years in education model (ROE) we are poorly paid compared to other professionals, some trades and “quasi” trades. I have always taken that as an implicit compensation for the flexibility professors get that others do not. I make 1 quarter of a psychiatrist who has two thirds the education. But I have more flexibility. She ogles my flexibility I ogle her pay. And we both choose our careers on that basis. /sometimes I wonder what I would do with 24K a month but then I ask myself what good would a sail-boat be without the flexibility to sail it? She asks herself what good would the flexibility be without the money to buy the sail-boat? I keep telling her to buy the sail-boat and I will sail it but she won’t go for it?:)’

    In terms of ROE I would have never taken this job. But hey money does not motivate me, liberty does. So you will not hear me complain about my pay until either other ppl say I am overpaid or some administrator wants me to work like an jr. accountant in the Panipticon but does not want to pay me as such.

  • Really Dr. Rowe? Really? While I had little doubt that the irony of my polemic would go unnoticed, I had hardly anticipated that you would miss the point completely! Further, I sincerely, though foolishly it seems, doubted that you would take what I had to say so deeply out of context. Alas, let’s examine what little you have to offer.

    You state that professors already contribute to scholarships and bursaries and that more professors should take on this responsibility. This you have reasoned as a reply to my assertion that professors who feel they are overpaid should offer something akin to a rebate to students who enroll in their classes. Two things about your response warrant a serious consideration. One, should the total dollar amount of scholarships and bursaries be increased? If tuition fees continue to increase, which at Carleton they will for the next 6 years at an average rate of 4.5% (4% for Arts students, 6% for international students, up to 7% for ‘professional programs’ like journalism) then yes, absolutely the dollar amount of scholarship and bursaries should increase. However, if we start to see some substantial downward pressure on tuition rates, then it might be possible to avoid increasing the funding allotted to students. It doesn’t take an economist to know that the latter is almost completely unlikely and that the former (i.e. increasing scholarships to attempt to keep pace with increasing tuition) won’t be sufficient to seriously alleviate the financial pressure put on university students. As a slight aside, the Ministry of Training, Colleges and Universities does stipulate that, “10% of the tuition revenue generated by the increase [in tuition fees] must be re-invested into student support” (Carleton’s Operating Budget Notes 2010-2011) but there is no guarantee from the university (at least not Carleton to my knowledge) that this ‘revenue’ will be committed solely or even in part to scholarships and bursaries. So bursaries may increase, but tuition will increase – a recipe for economic success, isn’t it?

    Two, should professors be responsible for providing increased scholarships and bursaries to students? On the whole, no! Let’s not forget that professors, especially young professors, already face substantial debt from their time in the university system as students. What I did state in my original comment was that professors who feel they are overpaid (like yourself Dr. Rowe) should offer money back to students not based on merit but on the simple fact that ‘tuition is too damn high’ (just like the rent in New York). However, since you raised the fact that more professors should contribute out of their own pockets to scholarships and bursaries, I’m curious as to when you will be creating the St. Rowe bursary for students? Now I’m no economist, but by my rough calculations, you could create 3 or 4 bursaries valued at $2000 each year without any real impact on your overall standard of living. Maybe these bursaries could be awarded to students performing critical research on university structures, tuition costs, provincial transfer agreements or the ever-increasing financial exploitation of international students? Or, to widen the potential pool of applicants, to those performing research on the benefits of progressive taxation and income redistribution? Please let me know where I can apply for your forthcoming award!

  • James there is of course the irony that most of those who have clamoured and our clamouring for tuition increases are those that got their university education subsided at over 80%. It is also the same age cohort that does not want PITs raised nor the progressiveness of the PIT system because they are in their best paying years. I think the generation that attended university say between 66-86 ought to be slapped with a tuition tax on their present income sufficient to cover 60% of their education costs with interest of course. It should also be a flat tax of course which makes no distinction between professions and remuneration.

    Personally I am not comfortable leaving things up to the charitable instincts of my overpaid nearing retirement fellows.

  • University of Toronto defined pension plan shortfall of 44 million dollars. Who pays for that .FUTURE STUDENTS I guess. Come on man,you ARE big Boys and Girls contribute to your own retirement.Stop asking the next generation to stiff the bill.

  • @ Richard,

    44 million? Grow-up the U of T endowment is 1.4 billion and counting.

    And by the way I am over contributing to my university pension shortfall so the retiring generation can have their contractual obligations met. And my generation of profs are getting fked. So you must be talking to the 60+ crowd.

    So what I am really saying Richard is that you do not know what you are talking about.

  • Referring all the way back to the original posting:

    “Good remuneration for university professors should be seen as a good thing, not a bad thing.”

    Why? I’m not suggesting that they should be destitute; I presume that Mr Falvo means that professors should be paid superior salaries. However, he offers no justification for this statement, does he?

    Mr Falvo’s third point: A lot of people spend varying amounts of time in tertiary education, not just those who eventually take PhDs. Many of them never achieve the income levels that would appear to justify their expenditures of money and time in education. It’s apparent that there is a considerable mismatch between the education programmes that people choose and what the entry requirements are for jobs, including those in academia. Why should those in this segment of the economy be any more favourably rewarded for spending excessive amounts of time in training than those anywhere else?

    Finally: Has anyone who has ever looked through a typical academic journal volume not thought that we would be better off with the trees than the paper? Or that the time of most of the academics that wrote the papers could not have been better spent in other occupations?

  • Hello Travis. Sorry I did not respond to your email of January 19 2011.However, I HATE TO INFORM YOU but the endowment fund is not to be used for pension liabilities.Currently your pension solvency deficit as of june 30 2010 is 1065.9 billion.I do not think you meager contribution is going to cover this shortfall.
    The University of Toronto is Defined PENSION PLAN.The employer U OF T is liable for any shortfall.This will probably be passed on to the student or taxpayers.
    I reviewed your plan and I CAN NOT BELIEVE WHAT I FOUND.
    1. Employer contribution between 2001 and 2010 was 629.5 million dollars employees contribution was 254.6 million dollars.This equates to 2 dollars for every dollar you contributed.S

  • .Hello Travis. Sorry I did not respond to your email of January 19 2011.However, I HATE TO INFORM YOU but the endowment fund is not to be used for pension liabilities.Currently your pension solvency deficit as of june 30 2010 is 1065.9 billion.I do not think you meager contribution is going to cover this shortfall.
    The University of Toronto is A Defined PENSION PLAN.The employer U OF T is liable for any shortfall.This will probably be passed on to the student or taxpayers.
    I reviewed your plan and I CAN NOT BELIEVE WHAT I FOUND.
    1. Employer contribution between 2001 and 2010 was 629.5 million dollars employees contribution was 254.6 million dollars.This equates to 2 dollars for every dollar you contributed….Dear Travis. I am sorry for the glich. Here is the continuation of my conversation.Sweet deal. I WISH someone would put 2dollars into MY RRSP account for every dollar I CONTRIBUTED.
    Second.For each year worked an additional year of pensionable service is earned.Hence 15yrs of service works out to 30 years of pensionable services earned. Sweet deal.
    Third.Pension based on the average of your highest 36 month average up

    to 150,000 thousand dollars.Sweet DEAL.
    You wonder why your pension fund has a1069.5 deficit.The sad thing about this is that most goverment pension have similar perks.Currently the taxpayer contributes app.24 BILLION DOLLARS annually to these plans to fund defined pension plans.I THINK OUR TAX DOLLARS COULD BE PUT TO BETTER USE. MAYBE HEALTHCARE.As I stated before stop asking others to fund you pensions. There are many other options ; RRSP, TFSA.

  • I do not work at the U of T. I work at Laval. We are all having problems because of the GFC. Professors are 50% responsible for the shortfall (young profs that is). The employer contributes 50% as per the CA. It is really just forced savings out of present income. Would you feel better if the employer simply paid me 500$ more a month? Do you really think that when the university administration bargains they do not include pension contributions as part of our salaries? Do you really think faculty associations do not? Look I would be more than happy if the university would just pay me the extra 500 a month and not withhold the 500 I pay. First I would pay off my student loans and then I would put it all in the great tax give-away to the upper middle class and the rich called RRSPs.

    And by the way I did not ask for any of this. The deals were all inked before I arrived. AS for the specifics of my pension plan I will probably after taxes and deductions be at something like 70% of pre-retirement salary. That is if I stay the full 35 years. And if I leave Laval before 10 years of services I get zip, not a thing.

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