A bright young man -- let's call him Prakash -- visited us sometime ago. Armed with a newly minted PhD from a top US university, excellent publications and expertise in a hot field, he was looking for a faculty position at several Indian institutions (as well as at several universities in the West). He told us that while low faculty salaries in India are a bummer, he was confident -- because of his field's high hotness coefficient -- that he would be able to earn more through consultancy.
"I am interested," he said, "in knowing more about the other things." Since his field is resource intensive (requiring fancy equipment, gadgets, materials), he started with the start-up grant. He was aghast when he learned that his budget -- several tens of millions of rupees -- was way beyond what is common in almost all the institutions in India. [IIT-B, for example, announced -- just yesterday! -- an increase in start-up grant from Rs. 300,000 to Rs. 1000,000]
"I'm not in this game to play in the little league," he retorted. "My field is extremely competitive, and I want to play in the Big League."
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If you you are a Big Leaguer (who isn't? ;-) in the market for a faculty position, many people assume that you would not choose to join an Indian institution because of low faculty salaries. They cite the acute faculty shortage even in our premier institutions such as the IITs [Again, the report about IIT-B's new initiative also informs us that they need 900 new faculty members!]. They look at the grand plans unveiled by Prime Minister Manmohan Singh to create many new IITs, IISERs and central universities, and they go, "Tsk, tsk, where are they going to find people to fill their faculty?"
That this pessimism is widely shared is an understatement. But, can something be done to get rid of this pessimism?
Move beyond salaries
An obsession with low salaries is pointless and counterproductive. Let's face the fact that salaries are not under an individual institution's control; since faculty salaries are mixed up with those of other Central government employees, no institution can hope to create a salary structure that benefits its employees exclusively. Bottomline: we have to (learn to) live with what we have in India: government-funded institutions with government-imposed constraints . (What about private institutions? Yeah, what about them?)
As of now, institutions can do certain -- admittedly limited -- things: (a) point out that salaries will be revised upwards by the Sixth Pay Commission in the next year or so, (b) play up the fact that faculty salaries can be augmented through consulting for industry.
In addition, I have also argued for a reform that would allow faculty to earn a salary component in research grants (currently, grants from industry allow this, but those from the government don't). To the extent that our academic institutions have any clout, they should use it to get this feature implemented by our funding agencies.
Who are the real competitors?
Many people -- in particular, our business press -- appear to insinuate that the private sector industry is the main competitor for faculty talent, and they urge our academic institutions to 'do something' about faculty salaries. I don't even agree with this assessment. First, getting into a pissing match with private sector on salaries is a game that government-funded academic institutions can never win, and therefore, should not even get into. Second, while private sector salaries may be great, private sector jobs are not -- specifically for academically oriented folks. This is true not only in India, but pretty much everywhere: academics everywhere forego fat salaries in industry when they choose university jobs.
Thus, in the war for talent, the real competition for Indian academic institutions is from research and academic jobs abroad (primarily, the West).
When you talk to those who emigrate to the West, most would insist that it is not just the money (though it is nice!), but the opportunities that make them choose to leave. So, the key question boils down to this: How can Indian institutions create an environment that offers lots of opportunities for their faculty to thrive professionally?
I can think of several steps.
Start-up grant. I have a long rant, but here's a blunt summary: A low start-up grant in this era of institutional affluence is scandalous, and betrays how seriously misdirected our institutions' priorities are. By offering sub-optimal -- if not downright abysmal -- start-up grants, they are setting up a significant fraction of their junior faculty for a mediocre career at best, or a disastrous one at worst.
This situation must change. Our top institutions must be able to promise every faculty recruit that he/she will get everything he/she needs for the first three years: lab, equipment, students, post-docs, lab assistants, supplies, the works. Even if it requires half a million dollars (Rs. 10 millions or more) per faculty, I would say, "So be it. Give it to your hot young recruits, and set them up for success!"
- Our institutions should do every possible thing to attract first rate graduate students in greater numbers. I just talked about this a few days ago; take a look at the comments on that post where people have offered other suggestions. Many of the ideas there do not require a great deal of money, but they do require a change in mindset.
- Travel grants. During the initial years when there's very little external funding, it's important for an institution to ensure the visibility of its prize catch in international conferences -- at least once a year, and preferably more. [Currently, different institutions offer different levels of support. IISc, for example, offers travel support for one international conference abroad every three years. I am told that the IITs are a bit more liberal.]
- A reduced teaching load during the initial years. This was pointed out by Tabula Rasa in his comment on my post on start-up funds.
- A strong institutional support for taking care of things that are routine elsewhere. Getting lab repairs done (or purchasing equipment and supplies), for example, can be a painful exercise in most of our institutions. Many faculty members complain bitterly about administrative sloth, inefficiency and delays. Reforming this part requires a strong and sustained commitment from the top management.
- Fellowships for junior faculty  that can top up their salaries during their first three years. They can figure out, during the tenure of the fellowship, ways of earning an extra income (consultancy, industry-oriented research, etc) when they go back to their normal salary. [IIT-B's signing bonus is a limited version of the three-year fellowship idea].
Clearly, all these steps will require money, but this money (as opposed to money for salaries) is far easier to get now than in the previous decades. While our government may not be able to offer fat salaries, it is very happy to enhance science funding (much of which goes towards equipment). And our leading institutions are in an excellent position to attract philanthropic contributions from their alumni (IIT-B's initiative for its new faculty is a good example).
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All these things belong to the academic/professional realm. Professional success also depends on certain pre-conditions on the personal side, and in this (non-academic) realm, our government-funded institutions have at least three very powerful secret weapons: (a) excellent on-campus housing, (b) a clean, green and serene campus, (c) a good school (such as the Kendriya Vidyalaya) on campus. With urban sprawl, traffic, and pollution levels becoming worse by the day, the value of these secret weapons should not be underestimated.
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What do you think?
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 For my take on faculty salaries, go to these two posts. Here's a quick summary: in India, faculty salaries are not that low (compared to per capita GDP, and faculty positions come with valuable other benefits (campus housing, schools, etc).
 IIT-Kanpur has created quite a few fellowships for its senior faculty (or so I am led to believe). When some of us were talking the other day about this "incentive scheme" at IIT-K, someone quipped: "What? Have we come to a stage where our senior guys need an incentive to teach?"