A retirement incentive program at Minnesota State University, Mankato called “Board Early Separation Incentive” or “BESI” is being implemented to save money at the University level.
The University, needing to cut costs, hopes that offering BESI’s to staff and faculty will be a good option, as roughly 80% of the budget is allocated to paying for personnel.
During this time when BESI’s are being offered, the University releases that they will be offering money for those looking for a potentially looking to retire early. Faculty and staff that are interested then apply to for one.
Then, the University reviews these applicants, and on a case by case basis decides to offer the incentive or not. If approved, the University offers the BESI to the employee.
Interim Provost Matt Cecil stated that roughly 50% of applicants receive a BESI, based on criteria including whether or not the position would need to be replaced or not.
“They don’t have to take it then either,” said Cecil, speaking to how the staff can choose to change their mind after applying, “We see about 50 percent of people offered choose not to retire.”
Even with only about 25% of applicants eventually taking the incentive, this can still lead to a large amount of savings for the University.
This spring is the second round of BESI’s offered, with the first round rolled out in the fall of 2020.
The fall round of BESI’s were able to save the University $1.8 million, according to Cecil.
Early retirement incentives are seen as a positive, when compared to layoffs and retrenchment, which are viewed as extreme choices.
“The thing about retrenchment is that it is such a drastic step.” said Cecil, speaking to the negative effects layoffs have on faculty and staff, “It is the worst day of their life.”