Bowdoin's faculty and staff salary freeze, originally implemented in 2009, will be ending early.
President Barry Mills announced Tuesday that full and associate professors, as well as staff, will be receiving a 2 percent pay raise. Assistant professors will see their salaries increase by 2.5 percent. The increase will be reflected in March paychecks, but the move is being made to begin retroactively from July 2010. The freeze was expected to last through the current fiscal year (FY). Faculty on termed contracts and staff earning under $40,000 per year are unaffected by the raises as their compensation did not change as a result of the freeze.
Mills felt that the February thaw, as he referred to it, was a step toward financial normalcy for the College.
"You can only ask people to sacrifice for so long," Mills said. Mills made it clear that while he was pleased that Bowdoin was able to institute the raises, he understood that the increase was modest. Before the most recent recession, Mills said on average faculty and staff salaries have increased by between 4 and 6 percent since he arrived at the College 10 years ago.
In the e-mail to all employees announcing the salary increases, Mills credited the investment team for making the move possible. Mills said in an interview with the Orient that the College had projected zero growth in its endowment for 2010—ultimately, the College earned 10.3 percent growth in that fiscal year, and is already outpacing that mark in FY 2011.
Senior Vice President for Investments Paula Volent wrote in an e-mail to the Orient that "in comparison to our peers, we are doing great."
Mills said that the raises kept Bowdoin in line with the 4-5-6 policy that the College adheres to—taking the average increases of the fourth, fifth and sixth-ranked liberal arts colleges in faculty compensation.
"I'm very grateful that Barry Mills is keeping up with the 4-5-6 plan," said Professor of German Steven Cerf, who is in his 40th year at the College.
Though Mills said the raises were affordable for Bowdoin, the College's financial standing still maintained some risk. The threat mainly comes from inflation, according to Mills. Should wage inflation occur across the country, it would put Bowdoin in the difficult position of keeping up in order to stay true to the 4-5-6 policy. Mills did note that given the fact that Bowdoin's portfolio investment was outperforming most other colleges, that situation seemed less likely.
Senior Vice President for Finance and Administration Katy Longley was also concerned with commodity inflation. Longley felt that food and energy price inflation could affect the College, and pointed to the fact that the Consumer Price Index increased 0.4 percent from December to January, as reported by the Wall Street Journal on Thursday.
"On food, we are seeing significant increases which we haven't seen since February 2008," Longley said. She added that the College had locked in prices for electricity through 2013 and natural gas through the winter of 2012.
Cerf said the faculty was thrilled with the sudden raises.
"I was delighted that [Mills] called a special meeting on Valentine's Day, so this was the College's valentine to the faculty," he said. "It was special and we were very happy."