Tuesday, June 19, 2012

NSHE faculty (still) have 401-K style retirement plan, not PERS

The Sun writes up some of the funny math in a so-called "study" of state retirement costs but fails to mention the most embarrassing howler in this out-of-state group's under-researched blog post: that since 1970, higher education faculty do not participate in PERS (except those who were enrolled in PERS prior to their employment in NSHE). Although part of the "report" is a list of 200 faculty at UNR and UNLV who will supposedly be paid a total of several hundred million dollars over the next 30 years, in fact over 93% of faculty (including non-instructional academic faculty) at the two universities (and nearly 90% of faculty across NSHE) are in precisely the sort of 401-K style, defined-contribution plan that the sponsors of the "study" recommend because it carries 0 liability for the state after retirement. 

For this reason, the Nevada News Bureau covered the NSHE retirement plan as a "model pension" program over a year ago .

For those interested in some actual, empirically sound comparisons, we can turn to data from the 2011-2012 American Association of University Professors report on faculty compensation and benefits:

The national average for public 4-year universities is that retirement benefits cost the institution $10252 per faculty member, which amounts to 10.8% of total compensation. (And most universities also pay into social security, which on average costs the institution another $5383 per faculty member and another 6.2% of total compensation. Nevada state employees, including NSHE faculty, are not enrolled in social security, so the state does not bear this cost at all, nor are these benefits available to most NSHE faculty -- even though the authors of this "libertarian" study actually recommend social security enrollment as a way to cut costs for states and local governments!

(See Tables 10A and 10B for national averages of higher ed retirement programs.)

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