A surge in the number of professors and senior staff recruited by universities threatens to swallow what extra cash there is to meet pay demands across the board.
New figures from the Higher Education Statistics Agency show a 2.7 per cent rise in academic staff numbers from 2003-04 to 2004-05, with the bulk of the growth at senior grades. The trend is thought to have continued this year.
The figures are the first that allow yearly comparisons under a new, more comprehensive staff data system. They show virtually no change in the number of full-time standard-grade lecturers and a small rise in the number of researchers.
University managers welcomed the news, saying that extra staff had been recruited to maximise institutions' chances in the research assessment exercise and to address concerns over workloads.
But they warned that the addition of these staff to institutions' payrolls would leave employers with less room to manoeuvre at the salary negotiating table. Academic unions are calling for a 23 per cent salary rise for their members over the next three years.
Union leaders, who are threatening industrial action unless their demands are met, said that while the figures meant higher costs this was not an excuse to reject their pay claim.
A breakdown of the Hesa figures seen by The Times Higher reveals that in one year universities took on 2,735 extra staff on full-time contracts, with two thirds of the extra numbers at senior grades.
It has been estimated that this could have added more than £100 million to the sector's pay bill, based on an average academic salary of £40,000. The estimate excludes the cost of the 1,215 part-time staff recruited.
Dame Nancy Rothwell, vice-president for research at Manchester University, said: "Some institutions may have been spending money for the RAE in the hope that it will pay off. This is all extra money that is coming out of one pot."
Mark Thompson, pro vice-chancellor at Leicester University, said institutions were investing in more senior staff to achieve "critical mass" in research.
"Clearly, if there is an increase in staff, that will affect the pay bill. It is a concern across the sector that even with an increase in resources coming in the cost of running a university is going up."
Adrian Buckley, assistant director of personnel at Birmingham University, said institutions were recruiting more staff for the RAE and to help relieve academics with heavy workloads. He said: "The unions are saying we have lots of money coming in from higher fees. But we are trying to introduce the framework agreement, put money into the pension scheme and increase staff numbers to compete in the RAE. There is only a limited amount of money to cover all of that."
The Universities and Colleges Employers' Association said the increase in the number of senior staff was "addressing the growing needs of complex organisations".
Malcolm Keight, deputy general secretary of the Association of University Teachers, said the union understood the need to attract high-scoring staff for the RAE. "But this increase in the number of staff should not be used as an excuse to avoid improving the lot of staff at all levels," he said.
Roger Kline, head of Natfhe's universities department, added: "An extra 2.7 per cent staff will clearly affect budgets, but as far as we are concerned it should not affect the calculation that our pay claim is based on."