Saturday, 20 October 2012

Betting on the Future

Last week I released a memo to members of the Faculty of Science. It announced that the Faculty was taking a loan from the University of Alberta to allow us to grow the professoriate. Some of the justification was given in the memo:

“Now is the time to be hiring. Across North America, the number of open academic positions available is incredibly small, a reflection of the difficult financial times. It is a buyer’s market – departments who are fortunate enough to be hiring can pick and choose amongst the very best Ph.D. graduates from the very best schools. In a few years, this situation will reverse itself into a seller’s market. When financial stability returns, there will be massive hiring across the entire academic spectrum, the consequence of many years of a forced hiring diet. That is exactly when we should not be competing in the market.”

Because of budget reductions over the past four years (13%), the Faculty of Science and the Department Chairs have largely concentrated on damage control. This has to end. The first step was announced in the above-mentioned memo: stop the decline by having the Dean’s Office absorb the entire 2013/2014 budget cut. The second step is to reverse the direction and start growing. How do you do this when your budget is being reduced? Get a loan.

The case for a loan was made to the President and Provost based on the argument that the University of Alberta would be wise to take advantage of the current job market situation. There was no possibility of getting a loan to offset the upcoming budget reduction.

With a loan, the Faculty of Science can resume being proactive on a number of fronts:
·    We can grow. In 1999/2000 the professoriate numbered 288, in 2003/2004 we peaked at 300, and today we are down to 292. During the same time, Science Faculties at many of our peers have grown significantly.
·    The University’s total NSERC funding has fallen from second in the country into a pack of several universities vying for a distant third place. Although the total dollars going to Science has stagnated, our funding per faculty member remains strong. In other words, a large part of our fall has been due to the quantity of faculty members, not the quality.
·    A paucity of hiring over an extended period of time is unhealthy. For example, consider the Department of Computing Science, which is top heavy with only one junior Assistant Professor. What state will it be in after a few more years of little or no hiring?
·    There are opportunities to hire outstanding researchers, potential chairs or award winners. We need to be able to take advantage of such opportunities when they arise.
·    There are research gaps that need to be addressed. For example, adding the right person to a research team might elevate it from “Canada class” to “world class”.
These new positions are not business as usual. These positions are precious and need to be carefully thought out. They must be strategic. There are no preconceptions where they might land. At one extreme, it is possible that they all end up in one Department.

A few people have criticized my decision to ask for a loan on the basis of the potential risk and additional cost (interest) to the Faculty of Science. There are several responses to such an argument, but the one I prefer is personal. I never would have owned my first car had I not received help from a bank loan. Similarly, I would have been living in an apartment instead of a house for an additional 8.5 years had I not asked for a loan. Yes, loans incur risk and cost money. However, if thought through carefully the advantages should outweigh the disadvantages. In my case, the freedom to drive wherever I wanted whenever I wanted meant a significant improvement in my quality of life. A similar case can be argued for the purchase of my house. And, for Science, being able to take advantage of an opportunity (the current job market situation) might pay huge short- and long-term dividends. Is it a guaranteed win? No, but the odds are probably strongly in our favor.

I would argue that the risk is low in that during the timeframe of the loan (five years) there is a very good chance that the economy will improve. Even if that does not happen, there are other sources of funding that might offset some or all of the costs. An obvious example is donations – a large part of my job is working with donors to help strengthen the Faculty of Science. Another example is our annual one-time sources of money. Many of these funds are highly reliable from year to year. If they continue to grow at the current rate, then they can cover most of the loan.

To some people the idea of a loan looks odd – adding new faculty members at the same time as dealing with a budget reduction. We have no control over the latter, but the former represents an opportunity that will help energize the Faculty of Science and position us well for the future.

1 comment:

  1. Buy low, sell high. This is universally accepted as wise.