Tuesday, August 11, 2015

The Pension Crisis at Public Universities

The Atlantic
August 10th, 2015

The Southern Illinois University history professor Steve Hansen didn’t need an academic analysis to tell him his retirement income was at risk in a state struggling to narrow an estimated $111 billion shortfall in its public-employee pension fund.* So, in 2012, at 63, Hansen quit his university job to lock in his benefits before they could be watered down. So did 408 fellow employees of the university’s two campuses, and another 1,008 at The University of Illinois—twice the number who had left the year before.
Perhaps ironically, Hansen has since been called back to the university for a temporary position and is now dealing with budget and staffing issues from the other side: as the interim dean of its liberal-arts college while administrators search for a permanent replacement. Nationally, the retirement rate is on the rise in part because the population is aging.  But “we have started to lose faculty who normally would probably have stayed,” Hansen said. Along with the proposed budget cuts in Illinois this year—6.5 percent for higher education—the exodus of faculty and others from the university “has an obvious direct impact on the quality of instruction and the quality of education,” Hansen said, adding that an infusion of money is the only thing that can reverse the trend. “The obvious place to turn is higher tuition. It’s a terrible spiral.” 

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