A report by the Intergenerational Foundation has shown that a decline in final-salary pensions and meagre pay increases mean that new entrants to the profession will be much poorer pensioners than their peers who are retiring today.
The analysis provided in Higher Education: A Tale of Two Payslips finds that the decrease in fortunes is down various factors which together paint a bleak picture.
A projected £13 billion deficit in the main university pension pot provided by the University Superannuation Scheme (USS) coupled with the increasing longevity of academics are both factors which mean universities may have to decrease how much their pension plans are worth.
The report’s author, Louis Goddard, said: “If we want a profession that truly reflects the diversity of this country, and not an anaemic caste of pay-to-play dilettantes, then those who benefitted most from the Golden Age, and who now sit in positions of academic and political authority, need to take action now.”
The study also says research councils funded 45 per cent fewer master’s places in the humanities and social sciences in 2012-13 than PhD places, leaving aspiring academics with the reality of having to pay up front for master’s degrees or take out expensive loans.
Should they wish to seek an academic career, the first cohort to pay £9,000 fees will be particularly affected, as they will graduate with debts of more than £40,000 before even contemplating borrowing more for postgraduate study, the report says.
Meanwhile, the paper cites a University and College Union study that suggests that more than 12 per cent of all academic staff and almost half of “teaching-only” staff are employed on zero-hours contracts, with no guarantee of work or specific pension protections.
The report indicates these factors will only further compound issues of diversity in the sector and could lead to a situation where only the wealthiest in society are able to afford to enter a career in academia.
Co-founder of the Foundation, Angus Hanton, believes the problem could be profoundly damaging. “Commentators might suggest that young academics are merely facing a short period of bad luck following a period of economic stagnation,” he said.
“However policy makers should be under no illusions that losing new academics could affect the UK’s position as a leading global education provider.”