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To Retire or Not? Retirement Policy and Practice in Higher Education
Reviewed by Ernst Benjamin
Robert L. Clark and P. Brett Hammond, editors.
Philadelphia: University of Pennsylvania Press, 2001, 174 pp.
The essays in this volume are essential reading for anyone concerned about the impact on the future of higher education of the federal legislation that ended mandatory retirement of tenured faculty in January 1994. But it is necessary to read with care, because the editors introduce the volume with the misleading claim that "retirement and retirement policies . . . drive or deeply affect such issues as new faculty hiring, the ability of colleges and universities to change the direction of teaching and research, and the age structure of the faculty." It is essential, instead, to understand the essays in the light of the editors’ subsequent observation that not retirement patterns but "the aging of faculty hired to teach the baby boomers combined with smaller cohorts of subsequently hired faculty are the primary cause of the aging of the academic labor market."
Earlier studies have found that eliminating mandatory retirement is unlikely to affect faculty age structure substantially, except in a few elite private research universities. The essay here by Robert O’Neil describing the results of its elimination in two states in which he served as president of the flagship public research universities illustrates this perspective, as do the concluding essays by Sharon Smith and by Karen Holden and Lee Hanson. But the first essay in the volume, which summarizes the results of a study of North Carolina public and private research universities, suggests a more alarming pattern. In these institutions, retirement rates of older faculty did decline dramatically after 1994: from 61 to 38 percent for those aged sixty-nine and 77 to 13 percent for those aged seventy. Another widely quoted paper by Orley Ashenfelter and David Card, discussed but not included in this volume, confirms these findings based on the retirement rates in a large sample of institutions.
The North Carolina study also reports, however, that "the mean retirement age of the sample has not varied much over the nine-year sample period." That is, as is the case generally, late retirements have been offset by early retirements. Few faculty reach the ages of sixty-nine or seventy. Data from the fall 1998 National Survey of Postsecondary Faculty indicate that only 1 percent of full-time faculty are over seventy and only 4.5 percent are sixty-five to seventy years old. In fact, as Smith demonstrates, so few faculty reach seventy that, even generalizing from the Ashenfelter and Card data, the percentage of faculty over seventy would be no greater than 2 percent.
Nonetheless, the small number of faculty over seventy and the constancy in the average age of retirement does not mean that deferred retirements may not create a serious problem for some universities, especially elite research universities with light teaching loads, or small colleges or departments with few opportunities for faculty turnover. The value of To Retire or Not? is that it en-courages and assists in the formulation of the flexible retirement policies that circumstances require. Where universities adopt broad, attractive early retirement plans, they risk losing their most desired faculty. If some have avoided this loss, as Ellen Switkes claims in the useful case study of the University of California that is included in the volume, it is because those faculty who choose to stay are often the most productive. Holden and Hanson, reviewing data from their earlier study, find that "faculty currently engaged in re-search expected to retire later—by as much as 1.4 years—than those reporting they were not engaged in research."
Even so, it is not easy to design early retirement programs that both avoid excessive expenditure and encourage the departure only of less productive faculty. As Ronald Ehrenberg shows in his case study of Cornell University and John Keefe confirms in his survey of seventy-seven plans at a variety of institutions, faculty will often ignore or resist incentives they find insufficiently rewarding. Further, as Smith emphasizes, attractive plans are expensive, and their costs can exceed their benefits. Moreover, it is difficult to disaggregate the factors influencing faculty retirement to determine which are most critical. Several essays included in the volume emphasize the importance of intangible, nonmonetary incentives, especially the opportunity for retired faculty to continue their professional activities. Faculty at elite private universities may defer retirement because they enjoy lighter teaching loads, higher salaries, and greater research opportunities than colleagues at elite public universities. Private-institution faculty may also, however, stay on because they participate more frequently in defined-contribution plans whose value appreciates more in later years than do the benefits in defined-benefit plans that predominate in some public institutions.
Early retirement plans based on defined-benefit plans may simply credit faculty with additional years of service or age in calculating their benefits. But efforts to design early retirement plans based on defined-contribution plans have faced substantial legal obstacles and the costly tax provisions that supple-mental contributions entail. The indispensable essay by David Raish explains both how recent amendments in the Age Discrimination in Employment Act have eased development of retirement incentive programs and why continuing features of the Employment Retirement Security Act deter those private universities that most need retirement incentives from taking advantage of these amendments.
Several essays suggest that these universities and others might do better to establish phased retirement plans involving negotiated adjustments in faculty responsibilities and compensation. The AAUP’s recent retirement survey revealed that about 27 percent of sampled institutions reported such plans. (Ronald Ehrenberg’s article based on the survey, "Career’s End: A Survey of Faculty Retirement Policies," appeared in the July–August 2001issue of Academe.) Other institutions have some of the elements of such plans: opportunities for part-time teaching, access to research facilities and assistance with research grants, postretirement medical benefits, and continued participation in depart-mental and university affairs. This flexible approach can vary by department, adapt to the needs of both faculty and institutions, take advantage of noneconomic incentives, and avoid most of the legal and tax complications associated with retirement incentive programs.
It is not retirement plans, however, but replacement plans that are the key to the future of the university. The fact that the average age of faculty has in-creased even while the average retirement age has held constant is due not only to the large aging cohort of faculty hired in the 1960s, but also to replacement practices. Even as the absolute size of the faculty has increased, the additional hires are disproportionately of part-time faculty, and many faculty retirees are not replaced by full-time tenure-track faculty. It is these replacement practices, not the rate of faculty retirement, that have principally shaped the "new faculty hiring," and with it "the ability of colleges and universities to change the direction of teaching and research, and the age structure of the faculty." The vital lesson to learn from reflecting upon this important book is that the future of the profession will depend less on who retires and when than on who replaces them and under what terms and conditions of employment.
Ernst Benjamin is senior AAUP consultant.
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