Modest pay raise for employees is under consideration

July 05, 2012

UNIVERSITY PARK, Pa. -- At the upcoming July 13 Board of Trustees meeting at Penn State Worthington Scranton, a modest salary increase for employees will be part of a proposed University budget for 2012-13, according to Penn State President Rodney Erickson.

"After two years when a majority of faculty and staff saw no more than a 1 percent increase in their salaries, we believe it's important to make an effort to recognize the hard work and dedication of our employees as they continue to keep Penn State on track and productive in every area of our mission," Erickson said. "Despite the tight financial constraints that we are under, we're able to accomplish this largely as a result of significant cost cutting, recycling and other budgetary adjustments, the extent of which is roughly equal to the magnitude of the proposed salary increase."

The general salary increase pool is proposed at 2 percent, with an additional 1 percent in the President's Excellence Fund for special merit, market and equity adjustments. Due to budgetary and appropriation uncertainties earlier this spring, individual salary increases will be determined later this summer and made retroactive to July 1.

Over the past 20 years, Penn State has cut $237.7 million in recurring costs from its operating budget. This number reflects each dollar saved only in the year it was cut, but when carried through subsequent years, these changes amount to more than $2 billion in accumulated savings over the past two decades. More than $67 million of recurring costs have been cut in the last four years.

In addition to its many internal administrative and academic changes, the University has taken actions to slow the growth rate of significant cost drivers, such as health care and energy.

"We will continue our cost-saving efforts, as well as our investments in a limited number of new priorities and initiatives," Erickson said. "These are challenging times for higher education, and we still must find new ways to improve teaching and learning, enhance student success, advance discovery, and serve our many constituencies -- while becoming a more efficient and effective institution.

"Retaining our knowledgeable, effective and hardworking faculty and staff is what will allow us to remain competitive and strong," he said.

Last Updated July 05, 2012