GLOBAL: Australia and South Africa pay top salaries

It might come as a surprise to academics in South Africa but the purchasing power of their salaries, on average, is now higher than that of their counterparts in Canada, the UK and New Zealand, according to a survey of 46 Commonwealth universities. However South African academics earn 6% less than those in Australia - the top-ranked country when cost of living is taken into account.

At the same time, South Africa has the highest salary scales relative to national gross domestic product per capita and the overall average academic salary is seven times the GDP per capita. This is perhaps not surprising for a developing country where joblessness is high and average per capita income is low, and where there are deep inequalities between rich and poor.

The survey, taken over the past 12 months found that differences in average salaries between countries had reduced since the last survey three years ago. This suggests increased international competition for academic staff as well as efforts within individual countries to improve academic salary levels.

A report of the survey says the rate of growth in salaries in Canada, the UK and New Zealand has been higher than in Australia since the last survey. South Africa experienced the highest growth rate with a 51% increase over the past three years, but the report says this could be related to increased investment in higher education and efforts to restructure the sector, as well as high levels of inflation.

The survey was the seventh undertaken by the Association of Commonwealth Universities. The results take account of academic salary scales and associated benefits in 46 institutions across seven Commonwealth countries: Australia, Canada, Malaysia, New Zealand, Singapore, South Africa and the UK.

Provision of discretionary bonuses or market adjustments has increased significantly from the previous survey and is now offered at 63% of institutions compared with 41% in 2006-07, the report says. Several institutions also highlight specific recruitment and retention strategies, further pointing to the increased importance of attracting and retaining academic staff.

Australian universities continue to have some of the best pension and leave conditions, while Malaysia is notable for its extensive use of additional benefits on top of base salaries. These include set entertainment and housing benefits, as well as generous medical entitlements for employees and their dependents.

The report says 41 institutions in seven Commonwealth countries responded to the survey. Salary scales for academic staff were compared from point of entry up to professorial level and public sources provided information and data for an additional five universities in New Zealand.

Salary scales were analysed using a purchasing power parity conversion rate - the Big Mac Index - expressing all salaries in US dollars. For comparison of salary levels across the participating countries and over time, average salary levels were calculated.

The report says the PPP conversion factor incorporates the cost of living so salaries purchase the same goods and services in compared countries. Using a PPP conversion factor provides a more balanced basis for the international comparison of salary values than market exchange rates which are relatively volatile and do not reflect the cost of living in the countries concerned.

Participating countries were ranked according to their overall midpoint average, the arithmetic mean of the top and bottom of each scale averaged across all responses.

Australian academic salaries, at all levels except lecturer, continue to be above those of the other responding countries when cost of living was factored into the equation, the report says. The overall midpoint average of the Australian academic salary scales is US$83,670 or 6.4% higher than South Africa, the new second-placed country in the ranking.

The report says that had Singapore been included, it would have ranked highest of all participating countries, with overall midpoint average salaries 30% above Australia. But Singapore has not participated in the survey since the beginning of the 2000s and, because its sample this year was not representative, it was excluded.

South Africa ranks second overall with an average of PPP US$78,653 while Canada and the UK are in third and fourth place respectively. This is in contrast to the survey in 2006-07 when South Africa was at the bottom of the ranking.

Canada has an overall average salary of US$76,594, closely followed by the UK with US$76,377. New Zealand (US$68,863) ranks fifth when purchasing power is considered but the gap with its geographical neighbor, Australia, has narrowed considerably rising from 40% in 2006-07 to 21.5% in this survey.

South Africa has the highest salary scales relative to national GDP per capita (the overall average academic salary is seven times the GDP per capita) and also saw the highest level of growth in academic salary scales since the last survey (51%).

The report highlights the differences between the countries in setting academic salaries by examining individual countries' higher education funding and salary determination mechanisms. It also discusses salary negotiations and attraction and retention issues, as well as the internationalisation of higher education.

In Canada, provinces are responsible for funding while the eight main universities in New Zealand are state-owned. The report says this may contribute to the high diversity in salary levels in Canada and the relatively uniform levels of pay in New Zealand.

In South Africa, the large diversity in salary levels is due to the relatively high level of institutional autonomy while academics in public universities in Malaysia are part of the civil service, resulting in a relatively low impact on salary levels.

The report says these issues are particularly relevant as growing pressures on universities in terms of funding and accountability - intensified by the global economic crisis - have generated varied responses from the countries in the survey. This, in turn, may affect the level of pay for academics.

This sounds fantastic, but I would think that salaries for South African academics are still much lower than what they can expect to be paid if they work for a parastatal like the Human Sciences Research Council or the private sector.

Jackie Hadland