Pay the going rate

Andrew Oswald will bet a nice lunch that academics will receive market-led wages within ten years

My father used to drive to work in an old Rolls-Royce. The house looked out on a pretty part of the Water of Leith. It seemed to have lots of rooms - full of piles of journals with boring articles, bottles of wine, nice furniture, arcane books, reams of curious joined-up paper covered in squiggly brain waves, and countless visitors from other countries to be thrashed at table tennis.

Occasionally he would appear, looking grave, on our television set. I had one yellow cashmere jumper chosen by my mother and a Swedish table tennis bat with sponge rubber on both sides. I knew my father had not inherited any family money. There seemed only one conclusion. The boy looked at the man and deduced that academics must be reasonably well-paid.

Now they are not. Junior salaries in some universities are sadly close to joke levels. Anyone who walked with a first from a university today would have to be mad to go into university life.

The problems of low pay are particularly acute in subjects such as mine. Economics and computing are at the sharp end. No doubt other subjects are following fast. My students make fun of university lecturer scales: they go off to the business world at age 23 with masters degrees and within a year are earning reader salaries and within four years professorial salaries. Then the sky is the limit. Many are quickly over Pounds 100,000 a year. They know that if they stay in academia only a fraction will ever get to professor, and only then normally around age 40. It is likely that no British person with a first-class honours degree will enter economics PhD training in this country next year.

We cannot sustain a future world where the people delivering lectures are less clever than those in the audience taking notes. The only issue is: where is Britain going to go from here?

The future can be seen in the main English-speaking country where the private sector plays a key role - the United States. Wage levels there are not controlled by central government -Jdemand and supply pressures determine earnings.

If you want to calculate a sensible salary structure for British academics, take a random sample of US academics and look at what they earn in dollars. Then adjust for the costs of living in Britain and the US and the fact that the US is wealthier than Britain. What comes out is shown in the table. (And I am pretty sure that this kind of pay system will rule in Britain in ten years' time.) Nobody knows what Sir Michael Bett and his colleagues, who are considering the problem of higher education pay, will propose. It will be interesting to see. The salaries given here could be thought of as an attempt to work out rational guidelines - to say what Britain will have to be like once market forces take us in the US direction. The Bett committee has a tough job on its hands: some groups will not want to see large pay rises for academics. The committee will have to say that large rises are needed, particularly in some subjects, if quality is not to collapse in our universities.

My pay table is fairly equitable across generations. A few professors will be paid Pounds 100,000; one or two will make Pounds 150,000. But there will not have to be many if we are shrewd enough as a nation to fix the junior people's wages fairly high. Moreover, many staff in our universities will not earn these numbers. In the US, smaller universities pay only half or two-thirds of the salaries of the major ones. That will happen here.

I am prepared to bet a nice Warwick lunch that this kind of pay structure will appear here by 2009. Wagers by email by Sunday midnight.

Andrew Oswald is professor of economics at Warwick and co-author of a forthcoming ESRC report about the recruitment of academic economists.

* Will British academics be paid differently according to their subject within the next ten years? Email: soapbox@thes.co.uk

Future sensible pay differentials for the big UK universities

Subject senior 55-year old professor 35-year-old lecturer

Business Pounds 87,000 Pounds 50,000

Computing and IT Pounds 84,000 Pounds 48,000

Economics Pounds 80,000 Pounds 49,000

Chemistry Pounds 75,000 Pounds 44,000

Astronomy Pounds 71,000 Pounds 43,000

Physics Pounds 71,000 Pounds 42,000

Biology Pounds 70,000 Pounds 40,000

Mathematics Pounds 69,000 Pounds 39,000

Political science Pounds 64,000 Pounds 38,000

American studies Pounds 63,000 Pounds 39,000

Psychology Pounds 63,000 Pounds 38,000

Geology Pounds 63,000 Pounds 40,000

Sociology Pounds 62,000 Pounds 37,000

Architecture Pounds 62,000 Pounds 37,000

Philosophy Pounds 61,000 Pounds 35,000

History Pounds 61,000 Pounds 36,000

English Pounds 55,000 Pounds 35,000

Anthropology Pounds 55,000 Pounds 38,000

German Pounds 53,000 Pounds 36,000

Art Pounds 46,000 Pounds 30,000

Music Pounds 45,000 Pounds 30,000