State minimum wage laws impact colleges and universities as employers, but in many cases, higher ed is offering entry-level employees a better-than-mandated deal. More than half of higher ed administrators responding to a UB survey about minimum wage practices say their institution is paying more per hour than their state requires. The practice for 40% of respondents is to pay equal to the state minimum wage (the remaining aren’t sure).
The average minimum wage paid at schools represented by the 163 survey respondents—the majority of whom (57%) are from colleges with less than 5,000 students—is $11.37 per hour. (The federal minimum wage is $7.25.) Respondents were about equally split between public and private institutions.
Higher per-hour, less hours
Emmanuel College in Georgia pays more than the state minimum wage to remain competitive in today’s marketplace. “With the growth of the economy, the number of available skilled workers is fewer than ever, and [they] demand a premium [on coming to] work for us as opposed to the business down the street,” says Joann Harper, director of human resources and payroll coordinator at the school, which has fewer than 5,000 students.
The concept of increasing minimum wage because it’s the right thing to do for workers struggling to make ends meet has moved to the forefront of many national and state discussions on the issue. One anonymous respondent from a private college in California explained that an “institutional focus on social justice” is a key reason it pays more than the state minimum wage.
As some respondents noted, however, paying more per employee impacts working hours offered. “We have a limited budget for payroll. The higher pay means we have to limit working hours and hire more part-time, nonbenefit-eligible workers,” Harper says, adding that the higher costs could eventually result in student tuition increases at Emmanuel.
Student employees at Georgian Court University in New Jersey are experiencing the negative impact of getting paid more as well. “Our institution limits student employee hiring to the amount of Federal Work-Study allocations,” says Ceceilia O’Callaghan, director of career services at the private university with under 5,000 students. Those allocations aren’t keeping pace with state minimum wage increases, so student workers wind up with less hours. Departments, meanwhile, must make do with less student worker support.
While federal law does allow an exception to minimum wage requirements for student workers, Georgian Court officials don’t apply for it. “Since we still have to compete for student workers with off-campus entities and we are primarily a commuter campus, we feel we will not attract skilled students if we pay less than minimum wage,” O’Callaghan says.
Future outlook
Per state law, Georgian Court must increase its minimum wage every January through 2024. So the budgetary impact will continue.
The survey revealed that nearly one-third of responding institutions have plans to increase minimum wage in the next 12 months; of those 50 colleges, 20 are already paying above state minimum wage. One respondent noted that it’s all about maintaining the institution’s reputation of being an “employer of choice” in the region.
That’s a label any campus administrator looking for a quick and easy hiring process would be happy to have.
Melissa Ezarik is senior managing editor of UB.
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