Major budgetary challenges related to faculty and staff compensation and the information technology arena, and a commitment to keep any tuition increase as low as possible will be the driving forces in designing the 200001 budget, Provost Nancy Cantor told the Regents at their November meeting.
Her presentation provided the Board with background information related to the Universitys request to the state for a 5 percent increase ($16.94 million) in its appropriation, and a request for special support totaling $7 million for projects in two areasinformation technology and undergraduate education.
Sixty-one percent of the General Fund budget is allocated to compensation, and the University faces stiff competition nationally for faculty and locally for staff.
Nationwide last year, faculty salary increases averaged 4.8 percent, and were higher at private institutions and research institutions.
Last year we determined that in order to keep up with the market for first-class faculty, and to catch up in some areas where we were plainly behind, we would need an overall increase of between 4 and 5 percent, Cantor said. It turns out that this just keeps up with the competition.
With respect to staff, the states very low unemployment rate for highly educated workers, 1.4 percent, has created a labor squeeze that is especially tight for the types of workers who comprise much of our staff. The region has seen a 5.5 percent average annual growth rate in wages for these workers over the past three years, 6.7 percent last year. The situation is even more severe for information technology staff, Cantor said.
Prescription drugs and rising health insurance costs drove benefits costs up 10 percent this year, and they are projected to rise 8 percent next year and 7 percent the following year.
The University also will be negotiating new contracts with four bargained-for groupsbuilding trades, public safety, nurses and the American Federation of State, County and Municipal Employees.
Areas that will begin to be addressed through the $3 million special request for information technology include staff compensation and continuing efforts to incorporate IT into the curriculum, including increased use of the Web and technologies that promote and support collaborative activities; training future professionals in computer science and information; research on the interactions between technology and society; and work in such new fields as bioinformatics.
Keeping up with innovation in the use and the creation of information technologies is not a matter of choice for the University of Michigan, Cantor said. It is a matter of necessity.
Our strategy is to provide central support, largely via the Media Union, that can be adapted collaboratively to the particular needs of individual academic units and groups of academic units.
In concluding her remarks, Cantor said: We see growth in salaries for faculty and staff, growth in benefits costs, and continued pressure in the area of information technology, both for technical support and infrastructure, and for curricular innovation.
At the same time, of course, we continue to work to trim our administrative costs and to consolidate academic programs in order to provide resources for innovation. We seek, as always, the right balance between our role as a conservator of knowledge and practice, and our role as a leading institution in forging new ground with and for our students.