AGA Today
M.B.A. Track
Ph.D. Shortage:
Business Schools Seek Professors
By Ronald Alsop
The Wall Street Journal
January 9, 2007
Jean Wyer is a seasoned recruiter at PricewaterhouseCoopers, but a
recent headhunting request took her aback. Business schools were calling
on her not to hire their graduates, but rather to help them find
accounting professors.
That experience showed "just how dire the shortage of accounting Ph.D.s
is becoming," says Dr. Wyer, a principal at PwC. "What terrifies me as a
practitioner is the possibility that some schools may decide to stop
having accounting majors if they can't find enough qualified people to
teach."
The growing shortage of doctoral graduates from business schools is
indeed worrisome. The accounting field is especially feeling the
supply-demand pinch. But other disciplines such as finance and
management are suffering from a scarcity of Ph.D.s, too, as they try to
replace professors who are retiring or moving into corporate and
consulting jobs.
AACSB International, the accrediting organization for business schools,
estimates a shortage of 1,000 Ph.D.s in the U.S. this year that will
grow to 2,400 by 2012. Some universities, particularly public schools,
have cut back on Ph.D. programs because they're costly to operate. In
addition, AACSB found in a survey of deans that many have limited their
enrollment because of fewer qualified applicants.
For students, the Ph.D. shortfall means larger classes and more online
content. It also is pushing schools to steal professors from their
competitors, driving up the cost of salaries, summer supplements, and
other benefits such as research support.
James Thomas, dean of the Smeal College of Business at Pennsylvania
State University, is concerned about the spike in salaries as he tries
to fill 11 vacant positions, including nine that are tenure track. "If
we fill all of them, we will have to do some budget juggling given the
salary and supplement increases dictated by the present faculty
marketplace," he says. "Professors are becoming more nomadic as they go
where the money is; moving to another school may mean a 50% increase in
compensation."
Dr. Thomas, who successfully countered a couple of recent raids on his
accounting faculty, says "merit increases, summer support and endowed
professorships" are becoming even more important retention tools. Some
schools also are offering reduced teaching loads with more time for
research, as well as a faster route to tenure.
According to AACSB, newly hired professors with doctorates commanded
average salaries of $137,400 in 2006, up from $113,400 in 2000. But
those are just the averages; some faculty stars may fetch salaries of
$250,000 or more.
Those fresh out of doctoral programs earned an average of $100,800 in
2006, compared with $77,200 in 2000. New doctoral graduates fare
especially well in accounting and finance, with average salaries of
about $114,000.
"Sooner or later, the price factor will kick in and more people will
view becoming a business-school professor as quite attractive," says
Mark Zupan, dean of the Simon Graduate School of Business at the
University of Rochester. "But that hasn't happened yet." For now, Dr.
Zupan is courting mid-career professors, who are starting families and
find the quality of life and cost of living in Rochester, N.Y.,
appealing. "Rookies are too mobile," he says.
The best short-term solution appears to be enlisting more adjunct
faculty from the business world. While schools can't go too far in
hiring faculty without doctorates and still remain accredited, AACSB
sees plenty of room for more business professionals.
It
recently began promoting its Professionally Qualified Faculty Bridge
Program to bring new blood into the classroom. The first one-week bridge
session last fall at the University of California at Irvine attracted 26
people with expertise in such areas as accounting, marketing,
supply-chain management, information systems and real estate. A second
bridge program is scheduled for May at the University of Southern
California. "The cavalry is on its way," declares John Fernandes,
president of AACSB.
Similarly, PricewaterhouseCoopers plans to create a program called PwC
Teaches that would put the firm's partners through a short academic
training program and then lend them to schools. Dr. Wyer hopes to place
more than 30 partners on about 20 campuses, teaching primarily tax and
audit courses. PwC also may provide financial sponsorship for employees
who want to earn a Ph.D. themselves and teach accounting full-time.
While many managers certainly are interested in academia, especially as
they approach retirement, business-school deans are cautious. George
Daly, dean of the McDonough School of Business at Georgetown University,
is recruiting more nontenure-track faculty from companies, often with
M.B.A. rather than Ph.D. credentials. But he is careful to hire people
who are "thoughtful and reflective" and can do more than just relate
"war stories" from the corporate battlefield.
Penn State's Dr. Thomas says he receives at least one query a week from
executives who are nearing retirement or itching for a career change.
"But they forget that engaging a large group of students isn't something
everyone can do," he says. "I advise them to try their hand at a local
community college or even high school before they waltz into a top
university."