Duke wants you to retire

Duke University will soon roll out an incentive plan in the hopes of convincing about 700 workers to retire.

The cost-savings measure is one of several moves the university is making to cut $125 million from its operating budget over the next three years.

Administrators announced plans for the retirement initiative today at a campus forum focusing on budget issues. While not all the plan’s specifics are yet known, officials said they hoped to target between 600 and 700 non-exempt workers at least 50 years old with at least 10 years of service to Duke.

The offer wouldn’t be available to faculty or “exempt,” or professional staff members.

More details are expected in May, said Kyle Cavanaugh, Duke’s head of human resources.

During the one-hour forum, Duke administrators painted a less-than-rosy picture of the university’s immediate fiscal future. A pay freeze recently announced for all workers earning more than $50,000 will likely last until the 2010-11 year, with no guarantees that raises will be restored then, said Tallman Trask, Duke’s executive vice president.

“I don’t think next year will be better,” Trask said of the university’s overall financial outlook. “If I had to guess, I think it will be a little worse. Unless there is a massive improvement in the economy, 2010 won’t be much better.”

The $125 million reduction amounts to 6 percent of the university’s overall, $2 billion budget. Duke officials have said they expect to eventually have “a smaller Duke,” one with perhaps 1,000 fewer positions through retirements, position eliminations and, perhaps, layoffs.

“As much as I’d like to say a workforce reduction is not a possibility, we’re not able to say that yet,” Trask said.

Duke is cutting costs all over the place. Travel is being reduced, as is spending on entertainment, though Cavanaugh emphasized there is a balance between canning every festival, celebration and other campus event to save a few bucks and retaining some such events because they help employee morale.

Construction on campus is essentially finished for now, Trask said, and will be for at least two years. That means the new central campus development — the one big project slated for the near future — will be delayed.

Other cuts are smaller.

With most employees on the direct-deposit pay system, Duke will eventually phase out the printing of paper pay stubs. That savings will be worth the equivalent of between one and two full-time FTEs, or full-time employees, Cavanaugh said.

And the university continues to accept suggestions from Duke employees, though one person’s great idea - like turning down the heat - isn’t really feasible, Trask pointed out.

“If the university shut down the heating plant and the chiller plant...that would solve about 25 percent of the problem,” he said. “We’re getting a lot of ideas. Very few that actually generate any money. But keep ‘em coming.”