Providing Incentives for Faculty Retirement
March 20, 2007
Offering faculty retirement-incentive programs is becoming a more common practice on college campuses, according to a new study by the American Association of University Professors (AAUP). The review of the retirement practices at 567 institutions showed that more than 38 percent of responding colleges and universities have offered one or more institutionwide, financial-incentive retirement programs to tenured faculty since 2000. For the majority of institutions, the incentive plans originated from governing boards or administrations. In addition, the number of phased-retirement programs has also increased since the original survey in 2000, with 58 responding institutions reporting implementing phased-retirement plans, while only 37 institutions offered such programs before 1994. Participation in phased-retirement programs included such incentives as: additional contributions to health insurance (78 percent), partial retirement benefits plus salary (56 percent), and extra salary (34 percent), among others.
Other findings include:
- Forty-two percent of institutions offer defined-contribution retirement plans; 12 percent offer defined-benefit plans; 5 percent offer a combination plan; and 41 percent allow faculty to choose either or both types of retirement plans.
- Almost half (48 percent) of institutions allow their retired faculty to teach part-time.
- At 82 percent of institutions, retired faculty are eligible for group health insurance. Fifty-one percent of institutions offering group health insurance to retired faculty pay part of the costs, 33 percent require the retiree to pay all of the cost, and 17 percent of institutions pay the entire cost.
Despite an increasingly aging faculty and more retirement incentives, colleges and universities indicated that recruiting new faculty and retaining current faculty was more important to their institutions than retiring older faculty. Almost all (96 percent) of responding institutions indicated that recruiting new faculty--and 89 percent indicated that retaining current faculty--was “very important.” Only 19 percent reported that retiring older faculty was “very important.”
The study, Survey of Changes in Faculty Retirement Policies 2007, examines retirement policy trends since AAUP’s first survey in 2000 and was co-sponsored by NACUBO, among other higher education associations.
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