Cuts may get tough, admins say

As the University continues cutting its spending, certain employees will feel the burden.

by Haley Hansen

Cuts in administrative spending may take a heavy toll on employees in upcoming years.

As part of the University of Minnesota’s plan to cut spending across the board, administrative departments are restructuring and eliminating positions. And while those units have endured the changes so far, school officials say future cuts may be harder to manage.

In 2013, President Eric Kaler announced a plan to reduce administrative spending by $90 million over six years. Last year, the school had cut nearly $19 million, and it’s on track to cut another $20 million in 2015.

Sixty-eight percent of the cuts for both years were personnel-related, and that trend isn’t likely to change in the next few years.

University Vice President and Chief Financial Officer Richard Pfutzenreuter said many departments spend about 90 percent of their budgets on personnel salaries.

Many of the first cuts came from attrition, retirement and shifting around responsibilities, he said, but eventually that won’t be the case.

“You won’t be able to nibble around the edges,” Pfutzenreuter said. “I think as it gets harder, you’re going to have to focus on the things that people don’t like to do, and that’s eliminate programs.”

The president and administrators, as well as deans and faculty members within respective colleges, will have the responsibility of selecting which areas are affected, he said.

College of Biological Sciences Finance Director Andrea Backes said most of the college’s cuts to this point have come from attrition.

“Essentially, every time that someone leaves a position, we try to re-evaluate and see if we can have any administrative savings by hiring at a lower level or not replacing the position or hiring different kinds of positions,” she said.

CBS eliminated a director position and two administrative support positions last year.

Backes said while the school-wide trims allowed CBS to operate more efficiently, future cuts will likely be more difficult to make.

“We’re definitely thinking it’s going to be much harder,” she said.

Cutting positions often means more work for other employees, Backes said.

For many employees, their jobs, which were already being stretched because of reoccurring budget cuts, have taken on even more responsibilities recently, she said.

While there’s always a risk of employees burning out, she said, many have been willing to take on more duties.

“They all know what the situation is with the University, and they’re willing to chip in where they can,” Backes said.

Kaler said he’s received mostly positive feedback on the cutbacks while acknowledging that changes to employees’ jobs are never easy.

“People understand the need for the organization to trim costs, but each one of those personnel decisions, of course, is dramatic for the individual involved,” he said, “and we’re trying to do it in as careful and compassionate way as we can.”

Backes said CBS is already having conversations about which areas may face cuts in the coming years, but the college hasn’t finalized any decisions yet.

“We’re getting together, and we’re having these kinds of conversations about, ‘What can we do better with less?’” Backes said.

Like CBS, Associate Vice President of Facilities Management Mike Berthelsen said a good share of his department’s personnel-related cuts have been through attrition.

He said the department has consolidated leadership programs and reduced its number of directors. The department has also restructured building-cleaning services to save money.

Not all of the department’s cuts have been in response to Kaler’s plan, Berthelsen added, noting that the department has been seeking ways to save for the past several years.

Ultimately, he said any sort of reduction has an effect on employees.

“Our goal is to always do what we can to minimize that impact,” Berthelsen said.

Meanwhile, the University is looking at ways to be more efficient with its finances system-wide, CFO Pfutzenreuter said.

“Every year, we cut budgets and reallocate. It hasn’t stopped. It isn’t going to stop,” he said. “We’re a bigger organization than we were 10 years ago … and our budget has grown, and people have taken on more work … I don’t consider us at all bloated or fat.”