Chapter 3: Reform Academic Employment Policies

A major cost item for universities is the cost of instructors. Costs for adjunct faculty are relatively low, but senior tenure-track faculty are very expensive; at a few universities, salaries for full professors (including fringe benefits) rise to as high as an average of $200,000 annually. A large portion of faculty receive tenure, the equivalent of a lifetime employment contract. A decision to award tenure often means making a financial commitment with a discounted present value of two million dollars or more. Hardly any other occupation offers such an extraordinary employment arrangement.

Tenure was originally designed to protect academic freedom and to prevent the dismissal of professors who take unpopular positions on issues. No doubt one strength of American universities is the diversity of ideas that are generated and disseminated as a result, at least in part, of the tenure system. Tenure can also be viewed as a valuable fringe benefit, making academic positions more attractive than they otherwise would be. As such, it might in some cases improve the quality of the professoriate.

Yet there are many objections to tenure.  First, tenure is a costly way to achieve job security. Many superstar professors are not the slightest bit worried about job security (seeing as they get job offers all the time), and the abolition of tenure would not have much impact on their willingness to work. Tenure is most often prized by the least productive faculty—the ones who would not receive an offer from another employer if they lost their current jobs. Tenure protects people who become incompetent or ineffective because of changing circumstances. It makes it difficult to reallocate resources over time as academic needs change.  The natural inertia of faculty is fortified by tenure since they have little to lose in opposing cost-saving or service enhancing measures.

The cost of tenure, ironically, is reducing its importance over time.  The inefficiencies and inflexibilities tenure creates has gradually led universities to replace tenure-track positions with part-time or non-tenured positions. In addition to the use of contingent faculty, some schools may initiate post-tenure review procedures that make it easier to dismiss marginal faculty members. Another alternative is to replace tenure with a system of renewable long-term employment contracts (of say, five years) that increase flexibility while still providing an element of job security.  Tenure could also be made more explicitly a fringe benefit with an explicit monetary value. Employees could then select the fringe benefit package that best meets their needs, subject to a maximum amount.  Insisting on tenure would come at a price to the employee, such as a reduced quality health care plan, reduced pension benefits, etc.

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