2007/08 Support Budget

Budget Challenges

One Percent Compensation, $27.6 Million

Total compensation packages are critical in attracting and retaining a highly motivated and qualified workforce. Over the past five years, salary increases for all employee groups in the CSU have not kept pace with increases for employees in other sectors of the state and national economy. The lack of funding for adequate compensation increases between 2001/02 and 2004/05 further compounded this problem. Based on U.S. Department of Labor reports, public and private sector average increases in employment salaries and wages totaled 14.5 percent over the five-year period from 2001 to 2005; salary increases in the CSU over that same period totaled only about 7 percent. The table below provides details of the CSU and other public and private salary increases:

Changes in Employment Cost Index Wages and Salaries Comparison with CSU Compensation Funding (2001 through 2005)

U.S. Department of Labor, Statistics Calendar Year 5-Year
Total
2001 2002 2003 2004 2005
State and Local Government 3.8% 3.1% 2.2% 2.1% 3.1% 14.3%
Private Industry 3.8% 2.6% 3.1% 2.6% 2.5% 14.6%
Average 3.8% 2.9% 2.7% 2.4% 2.8% 14.5%
  Fiscal Year 5-Year
Total
2001/02 2002/03 2003/04 2004/05 2005/06
CSU Final Budget
Compensation Funding
2.0% 1.5-1.68% 0.0% 0.0% 3.50% 7.0-7.
U.S. Department of Labor, Bureau of Labor Statistics

Assuming the funding provisions of the Compact are incorporated into the Governorís Budget, it is anticipated that the CSUís 2007/08 Support Budget plan will include a 3 percent compensation increase for all CSU employee groups. This increase is expected to keep pace with inflation, but will do little to close the persistent salary gap that developed over many years. These salary lags, which have increased especially from 2001/02 to 2004/05, have contributed to the CSUís struggle to retain and recruit critical faculty and staff and could impact the ability of the CSU to meet educational and business operational goals and requirements. This supplemental funding request of $27.6 million will assist the CSU in addressing the impact of minimal funding for compensation increases in prior years for all CSU employee groups.


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Budget Development
Chris Canfield
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Last Updated: February 02, 2007