Cost Savings or Cost Shifting? The Relationship Between Part-Time Contingent Faculty and Institutional Spending

Steven Hurlburt, Delta Cost Project/AIR

Michael McGarrah, AIR

Colleges and universities are relying heavily on contingent faculty to increase flexibility and reduce costs, yet little is known about whether such savings actually result in lower overall costs or if the money saved on instruction is being spent in other areas. This brief, Cost Savings or Cost Shifting? The Relationship Between Part-Time Contingent Faculty and Institutional Spending, the second in a two-part series, documents the financial trade-offs being made by institutions as they hire more part-time contingent faculty.

With the collaboration and support of the TIAA Institute, AIR experts investigated how the concentration of part-time contingent faculty—and the changing concentration of these faculty—relate to various measures of institutional spending.

Key Findings

A clear relationship exists between the use of part-time contingent faculty and cost savings in instructional salaries and benefits for faculty, both cross-sectionally and over time. In 2013, across all types of institutions, those with high shares of part-time faculty relative to other institutions of the same type realized lower instructional salary and benefit outlays per full-time equivalent (FTE) faculty, with the largest differences observed among private four-year colleges and universities. Likewise, institutions that made substantial increases in their use of part-time contingent faculty between 2003 and 2013 realized declines in instructional salary outlays per FTE faculty, and either smaller increases or declines in instructional benefit outlays per FTE faculty.
Although relying on part-time contingent faculty has helped to constrain compensation costs for faculty, cost savings in total compensation for all employees were more modest.
A review of changes in overall education and related spending reveals differences in the cost structures of colleges and universities that are shifting most heavily to part-time contingent faculty.