Part 2: Academic Staff Payment inequalities of the London universities

By Dr Solomon Habtemariam

Read part 1 of the article here.

1. Methodology

All data used in this communication are sourced from publications available in the public domain. HESA data for the year 2020/21, NSS data from the OfS, own publication by HEIs and other news media are used with acknowledgement of their sources. From over 100 London HE providers, 27 were selected based on academic staff number higher than 100 and students’ population over 1000. Ranking was established based on data on students, academic staff and expenditure including staff salaries.

• Addressing academic staff inequalities – What level of pay gap is fair and sustainable?

One can see this at three levels of financial investment  at their institution – senior management as sector wide issue, progression to, or investment on the highest academic level  (professors)  and other academic staff pay.

• How much do post-92 universities invest in senior managers’ pay?

Let us start this argument by using my own post-92 university (the University of Greenwich (UoG)) as an example. With annual turnover of over £231 million and home to 24 thousand UK students, the UoG is the fourth largest HE provider in London region, after UCL, King’s College and QMUL. As revealed in its latest financial statement, the UoG has 2511 (1209 academic/research and 1302 admin/technical) employees this year  with the overall staff cost including pension and social security costs as £127.507 million.  The salary of the very top earner at the UoG, the VC, is in the £240K-£245K band.  Don’t panic! It  is  not as high as the jaw dropping figures that we have seen for other HEIs in recent years. The number of top earners in the bar of £100,000 to £160,000 for the UoG  also appear to be modest, just 17 individuals (Figure 1). This post-92 university is however still spending over £2.1 million (excluding benefits) for the salary of 18 staff at the top end. 

Figure 1. Salary structure at the university of Greenwich. Top earners over £100,000 (18 in total) and salary band for the various academic grades (lecturer, senior lecturer, associate professor, and professor) in the inset are shown.

            There has been endless debate on the big pay gap between the average staff salary and the top earners: for the UoG VC, this equates to over 6-fold higher than the median staff pay. Academic salary structure at the UoG in 2022/23 is displayed in Figure 1. Once again, don’t panic – Just see below what is going on in other London universities. For the Russel Group universities, the total package in 2020/21 was reported to start from 265,500 (York) to £580,000 (UCL) and the highest basic salary in 2020/21 was £411,105 (UCL).   For comparative assessment, however, the HESA data for the year 2020/21 was used here and tabulated for the indicated universities as values  how many folds higher than the median pay staff for the institution (Table 1). Data was available both for total renumeration of VCs (or head of the HE provider) and their basic salary.   By both measures, the income of the head of the HE providers averages over 7-fold higher than the median pay of staff.   The narrowest pay gap was for the Guildhall School of Music and Drama and best performers of the London post-92 universities were The University of Westminster followed by St Mary’s University, Twickenham and Middlesex University. The biggest pay gap was for the London Business School and LSE. Unlike the academic staff pay shown in Table 2, there is no clear pattern of divide between post-92 universities  and the Russel Group when it comes to  pay gap between the VCs and median staff pay  (Table 1). Thus, if an academic in post-92 university is unhappy about how small their salary package is vis-à-vis senior managers, it is a sector-wide issue that needs global attention. There is significant variation among post-92 universities too.

Table 1. Salary and benefits of the Vice Chancellors/Heads of London Universities in comparison to median pay (2020/21)

• How good is academic pay rise in post-92 universities?

The best way to estimate the performance of salary increase over the years  is analysis using   one spin point scale. I am using herein the top spin point salary of AC4 (Associate Professor/Principal Lecturer/Reader) academic position at the UoG which rises  annually by pay scale adjustment in September, or what we say  annual negotiated increase to cover the burden of inflation. The salary increase over the last 10 years is presented to compare pay rise  with inflation over the same period.  This year (2022/23) saw the highest pay increase of about 3% and the compound average growth rate (CAGR) for the ten years period was 1.61%. There has been continuing argument between employers and trade unions on which inflation index to use for pay rise: the Consumer Price Inflation(CPI) or Retail Price Index (RPI), the data for both of which are available from the government statistics. The unions argue that CPI grossly underestimates inflation (it is even worse for pension calculation) and RPI should rather be used for salary rise or adjustments. Let us not get involved in this politics and just graphically present both for the ten-year period as well as  their CAGR.  By both CPI and RPI indicators, an academic at the UoG was at a financial loss and it is the extent of the loss by RPI that makes it worse (Figure 2). 

Figure 2. Academic salary (AC4) increases at the UoG over 10 years and annual CPI/RPI rate. Inset – compound annual growth rate (CAGR). Data taken for the November month of each year.

• How much financial loss is estimated by the CPI/RPI measure?

Instead of simple estimation using CAGR, one can use the actual  annual CPI or RPI value to calculate what an AC4 salary at the UoG over the past 10 years would rise by these rates. It is clear why employers use the CPI  as a reference for salary increase and by this measure, the  loss  over the 10-year period was only £6824.133, which was really a result of cost-of-living increase over the past two years (Figure 2). Noting the UK university staff get a one-off £1000 bonus over cost of living this year, which was well received by employees, the arrear appears to be in the order of £5824.133.  If the RPI calculation was to be used, however, the AC4 academic has lost  £29,896.46 over the ten-year period. This may be a sector-wide issue, but academics are underpaid based on inflation indexes. 

Figure 2. Academic salary (AC4) at the UoG over 10 years and scale forecast by CPI/RPI. Inset – Actual gross 10-year income and that by CPI/RPI forecast.

• Which academic feel the economic loss most over the years?

In the last decade, several cycles of new strategic directions, policies and priorities have been reinvented at every university to address equal opportunity/diversity/inclusion issues  along with pay gap for each underrepresented or undermined staff group. According to the HESA report,  however, there is still a staggering gender, ethnicity and disability pay gap for academic staff across the sector.  For example, female staff accounted for 49% of full-time staff in the UK HEIs  in 2020/21 but most part-time staff (66%) were female too. For the UoG, the male share of highest earners (≥ £62727) were 14.8% (sector 24.4%) as compared to  female share of 8.3% (sector 15.3%). The latest UoG financial report also revealed more female (56%) than male (44%) in the entire workforce but a disappointing gender pay gap of 11.2% was evident. Of the 17% staff who were of the BAME (black, Asian and minority ethnic) group in 2020/21 in the UK HEIs, their share of professors for the sector was  11%, of which  65% were Asian. Thus, those who belong to the group of undervalued academics must use additional formula to estimate their financial loss.  On this basis, marginalised group of academics could be even at a greater risk of poor mental health/wellbeing and work stress in post-92 universities.

• Are academics in post-92 universities paid less than the Russel Group?

The salary structure of academic staff in the UK from Lecturer to Professor positions are based on a single national pay spine points system which is negotiated by trade unions (e.g., University and College Union). There is a great deal of variations however and confusion on the different layers of positions. For example, both Lecturer and Senior Lecturer positions in post-92 universities are mostly in the same salary range as a Lecturer in the older (pre-92) universities. A Senior Lecturer position in the old (pre-92) universities  is at equivalent grade as  Principal Lecturer in post-92 universities  which is nowadays also called Associate Professor that is not in the same salary grade as the same title in pre-92 universities. It is thus vital to avoid academic titles when comparing salaries  between these two groups of universities.

The economic pain/gain of academics depends on where they work as evidently shown in Table 2,  compiled from HESA data (2020/21). Based on the proportion (%) of staff at the higher earner group  (≥ £62,727), a ranking order can be established.  With few exceptions (e.g., West Minister), the ranking of the London post-92 universities  appears to be at the bottom end of the Table – the UoG (my institution) ranked 23 out of 27 major HE providers in London.  One common argument on this kind of analysis is that it does not take into consideration of the age structure of the working force. In fact, an older age group (61-65) could be a true representation of career-based salary performance within the institution. Data are missing for some universities, or data could be small, and hence ranking was not made. With few exceptions, the data still shows higher proportion of the 61-65 age group academic staff in older universities at higher salary-band. An indicator of good/accelerated career progression is also salary comparison at the younger age, or the 36-40 age group in the HESA entry. In this case, good volume of data is available for analysis and shows 5 post-92 universities along with one HEI from the Russel Group with no entry for salary ≥ £62,727 (Table 2). The best performers for the post-92s’ were The University of Law and London Metropolitan University. Since the average salary depend on the population age of the workforce, which considerably vary by institutions, the data  on Table 2 must be seen as an indicator of career progression and/or salary variation only for the higher salary-band group. Overall,  the proportion of academic staff in higher salary band (≥ £62,727) at post-92 universities is far less than those in older or the Russel Group  HEIs.

Table 2. Ranking of full-time academic staff in London area based on proportion of staff in contract salary ≥ £62,727 in 2020/21.

You want to know more about this topic? Read more in the next part of the article here.

The opinion expressed in this article is solely the author’s.

 Dr Solomon Habtemariam is a principal Lecturer at the University of Greenwich

URL: https://www.herbalanalysis.co.uk/