University Update

To:    Members of the University Community
From:    Mark A. Nordenberg
Date:    March 2, 2009
Re:    Fiscal Year 2010 Salaries

At last Friday afternoon’s Honors Convocation, we celebrated the 222nd anniversary of the founding of the University of Pittsburgh, and we did so in true academic style—honoring alumni, faculty, staff, and students for their outstanding accomplishments and contributions. It would be impossible to participate in such an event without being inspired by the levels of talent and dedication to be found within our community, as well as the impact of the work being done here.

Honors Convocation also provides an opportunity to reflect on an institutional life that now spans nearly two and one-quarter centuries. Over the course of that extended time, our Pitt predecessors had the chance to witness many wonderful things, but they also endured fires and floods and wars, as well as economic crises as serious as the Great Depression. Through it all, they kept our University moving forward.

Now, unfortunately, it is our turn to deal with what might fairly be described as “more than our fair share” of bad fortune, even while we maintain our committed efforts to contribute to the greater good. It would not be productive even to try to compare our own hardships with those that were faced here in the past. However, the knowledge that significant challenges were met and overcome should be a source of encouragement.

Beyond that, steps recently taken by the federal government, as I described in my last Update, do provide new reasons for hope—for the economy generally and for higher education in particular. But we still are searching for any persuasive signs of an economic reversal, and most experts seem to be predicting that a recovery will not come quickly.

Each year, the University’s Planning and Budgeting Committee (UPBC)—whose members include representatives of the administration, faculty, staff, and students—makes recommendations to me regarding the shape of our operating budget for the next fiscal year. Typically, its advice covers a number of matters and comes in a single submission that is delivered in late spring, but this clearly is not a typical year.

Recently, at their first meeting of the new year, members of the UPBC assessed the continuing economic crisis and discussed the difficulties that will have to be faced in crafting a budget for the next fiscal year. Believing that it would be a prudent first step in meeting that responsibility and also feeling that it would be fairer to put everyone on formal notice as soon as possible, the UPBC recommended that next year’s budget not include a salary increase pool. I agree with that recommendation and also plan to implement it.

Even though many other universities already have taken this step, the decision not to provide for salary increases in next year’s budget was not an easy one for me to make or for the UPBC to recommend. We value the efforts of our faculty and staff and have made investments in compensation a high priority over the course of many years. However, given the stresses on our revenue streams, our ability to meet new expenses will be severely constrained.

A significant workforce reduction, the most obvious alternative in an institution with such heavy commitments to personnel expenses, was considered to be a far less desirable option by all involved. As we know from almost daily media reports, many organizations are moving forward with substantial employment cutbacks, but sitting at the very heart of our core strengths are the dedicated individuals who work tirelessly and effectively to advance our important institutional mission. It is both equitable and essential, then, that we do everything possible to maintain a reasonably stable employment base. Holding salaries at their current levels will help us to do that.

Obviously, we all will continue to hope for a quick reversal of our economic fortunes. From all that we now know, however, we will continue to face serious fiscal challenges for the foreseeable future. But, as noted above, our history shows that if we remain committed to our mission, we will prevail in our current struggles, as daunting as they may be, and Pitt will continue to make unique, significant, and lasting contributions—in education, research, and service—for many, many years to come.