2005/06 Support Budget

Support Budget Proposal — Compensation

2005/06 Compensation Increase, $88,078,000

It is critical that the CSU offers compensation that supports retention of highly qualified and motivated faculty and staff. The CSU Board of Trustees recognizes compensation for faculty, staff, and management as a key element of the university’s success. The CSU 2005/06 Support Budget includes a 3.5 percent ($88 million) compensation increase for faculty and staff. The actual distribution of the compensation increase would be determined by individual collective bargaining agreements negotiated with represented employees and CSU Board of Trustee approval for non-represented employees. The following table provides the faculty and staff compensation components that derive the CSU 2005/06 cost of a 1 percent and total 3.5 percent increase in compensation funding: The 2004/05 compensation base is comprised of salaries, retirement, and social security (OASDI and Medicare) budgeted by campuses in 2004/05. The 2004/05 compensation base is adjusted for changes in employer-paid retirement rates ($44.4 million) that the state funds post-final budget. The requested 3.5 percent compensation increase also makes resources available to address market conditions related to specific employee groups.

Cost of 1 Percent Salary Increase table

Further, the requested compensation funding will allow the CSU to reduce the growing faculty salary lag identified by the California Postsecondary Education Commission (CPEC). CPEC annually issues a report on faculty salaries at California public universities to the California Department of Finance and the California Legislative Analyst’s Office. In fiscal year 2004/05, the CPEC projected faculty salary lag is 12.7 percent. The table below provides information on the CSU’s faculty salary lag history from 1996/97 through 2004/05:

Faculty Salary Lag table

Further, as indicated by the following U.S. Department of Labor changes in the employment cost index, the CSU has not been able to keep pace with recent salary and wage increases offered by state and local government and private sector employers in general.

Changes in Employee Cost Index table

Also, the U.S. Department of Labor’s changes in employment cost for the first half of 2004 reflect quarterly salary increases of 1.9 percent and 2.6 percent, respectively, for these employee groups.

In comparison, CSU non-faculty salary increases since 2000/01 are indicated below:

Compensation Increases for Non-Faculty table

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Last Updated: November 10, 2004