Tuesday, July 29, 2014

Power and Income Inequality in the UC System and Beyond

In looking at recent employment trends in at the university, we find that the there has been a significant increase in the number of highly compensated individuals.  In fact, in 2004, there were 1,890 employees making over $200,000 a year, and eight years later, there were 5,461. This tripling of highly compensated individuals occurred during a period of reduced state funding and a financial crisis that resulted in layoffs, a salary furlough, massive tuition increases, and system-wide budget cuts. Furthermore, in 2012, the university employed, 262,415 people for a total payroll of $11.2 billion, and the people making over $200,000 represented just 2% of the employees, but they earned 14% of the income. In contrast, during 2004, the people earning over $200,000 represented less than 1% of the workers, and they took in 7% of the income. Just like the rest of the American economy, the trend thus has been to concentrate income at the top.

If we look at who the high earners are in the UC system, we discover that they are medical faculty, administrators, athletic coaches, law professors, business professors, and graduate faculty.  Almost none of the employees have anything to do with undergraduate education and none of them are unionized.  In contrast to this group of highly compensated individuals, we find the majority of teachers and workers who receive moderate incomes and are mostly unionized.   One thing then to learn from this example is that unionization is clearly not driving tuition increases, and in the case of undergraduate instruction, wages have remained stable, but they have not kept up with the huge increases of the top earners. 
Looking at the Office of the President, we find some surprising statistics.  We have been told that since 2009, there has been a major reduction in the number of employees and the cost of running the central office, but, we find that in 2008, there were 2,243 employees for a total gross pay of $155 million, and in 2012, there were 2,093 employees for a total pay of $155 million. So, the number of employees went down, but the cost stayed the same, and this is due in part to an increase of people making over $200,000.
As income gets concentrated at the top in the UC system, so does power.  The growth of the administrative class is coupled with an increase in the number of faculty hired outside of the tenure-track system.  According to the recent UC Accountability Report, in 1998, there were 7,250 full-time equivalent (FTE) tenure-track faculty on the general campuses and medical programs, while in 2013, there were 8,914; meanwhile, the number of non-tenure-track faculty (lecturers, visiting professors, clinical non-tenure) went from 4,511 FTE in 1998 to 7,638 FTE in 2013.  This means that during this period, the number of tenure-track faculty went up by 1,664, while the number of people off the tenure track went up by 3,128.  Although these figures do not include graduate student instructors and post-docs, it is clear that the majority of the people teaching and researching at the university have very little role in shared governance.  In fact, national studies show that as the number of faculty off the tenure track increases, the number of administrators increases, and the level of shared governance decreases.

Like the rest of America, the increase in income inequality and the number of highly compensated managers is coupled with a decrease in job security and compensation for most workers.  This transformation is also tied to a reduction of workplace democracy as a result of de-unionization, de-professionalization, and the growing disparity between the highly compensated managers and the part-time, flexible labor force.  In order to reverse these trends, we have to fight for increased democratic participation in the workplace through the creation of more stable jobs and a growing role of all workers in the decision-making process. Moreover, unions have to bargain for more democracy in the workplace and reduced income inequality.  


  1. Please consider adjusting all your numbers for inflation. By not considering inflation you make it easy to dismiss your argument here. I think you are still right, but you are shooting yourself in the foot, peeing in your own mess kit, etc.

    1. Allan Stewart-OatenJuly 29, 2014 at 9:08 PM

      I think this is absolutely right. I also think you are right but don't trust any figures that are not adjusted for inflation

  2. So if making $200,000 in 2004 is now equivalent to $243,000 after inflation, the increase in highly compensated employees would now be from 1,890 to 3,315 with a total pay of $1.16 billion, and they would represent 1.2% of the employees and 10% of the total pay. Most of the other statistics would not change because they deal with the number of employees.

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