(The Center Square) – A program offering retirement incentives to tenured professors in colleges and universities in North Carolina with declining enrollment proved successful, according to a new report.
The idea for the program started about three years ago as some schools in the state university system, including UNC Greensboro and UNC Asheville, began experiencing both enrollment declines and budgetary problems, David English, senior vice president of Academic Affairs for the UNC System, told The Center Square.
“Oftentimes, one of the things that was limiting the institutions was if you had a significant amount of money tied up in tenured faculty in areas that have shrunk,” English said. “It can really hamstring an institution’s options.”
Sometimes, this forced schools to make “draconian” cuts in other areas because of the amount of funding that was devoted to tenured positions, English said.
“If you could free some areas up in those tenured lines, you might give institutions the choice to make better decisions to actually reduce head counts in areas where you just don’t have the same level of demand,” English said.
University system officials were also hearing from faculty members who were old enough to retire that they were interested in the prospect of voluntary retirement incentives.
“We could help faculty members who want to retire and also provide institutions the ability to have a little bit more flexibility in dealing with enrollment challenges, enrollment shifts and budget declines,” said English.
The Legislature liked the idea as well, and in 2023 not only authorized it but appropriated $16.8 million for the incentives at six state colleges and universities.
All of those funds have now been spent, with 148 faculty members accepting the retirement incentives, which were the equivalent of a year’s pay.
East Carolina University and UNC Greensboro were the largest schools in the program. All faculty at all six eligible colleges and universities took advantage of the incentives, said English.
The faculty members had to agree to relinquish their tenure status in order to receive the incentives, but were eligible for whatever state retirement they had earned.
The salary savings from the program go to the colleges and universities did not revert to the state treasury but went back to the individual school budgets.
“That gave the campuses the ability to reinvest,” English said.
For example, a school might want to offer new courses in artificial intelligence. The early retirements freed up money that could make that possible, said English.
“You can hire some great folks, you can be competitive in a growing area, and get enrollment back to where the institution is stabilized,” he said.
Certain high-demand programs, such as nursing, were exempt from the early retirement incentives.
Whether additional funding will be provided for the incentives will be up to the Legislature.
