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A postdoctoral researcher, Carlee Ashley, conducts cancer research at the Sandia National Laboratory in Albuquerque, New Mexico, in 2011. Sandia researcher and University of New Mexico professor Jeff Brinker watches.

A postdoctoral researcher, Carlee Ashley, conducts cancer research at the Sandia National Laboratory in Albuquerque, New Mexico, in 2011. Sandia researcher and University of New Mexico professor Jeff Brinker watches.

Sandia Labs/Flickr (CC BY-NC-ND 2.0)

New U.S. overtime rules will bump up postdoc pay, but could hurt research budgets

Shock waves are rippling through the U.S. research community in reaction to a new labor law that will require that postdoctoral researchers be paid at least $47,476—thousands of dollars more than many earn now. Although welcomed by many, the change could have major impacts on budgets of labs and universities, which have only until 1 December to comply. And some fear it will lead to loss of postdoctoral positions, although some fields with relatively well-paid postdocs may feel less impact.

In a commentary in The Huffington Post, National Institutes of Health (NIH) Director Francis Collins and Department of Labor (DOL) Secretary Thomas Perez acknowledge “concern” about how the biomedical research community, which relies on about 40,000 postdocs (roughly half the total in all fields), will absorb the change. But they are “fully supportive” of raising postdoc pay and “confident the transition can be made in a way that does not harm—and actually serves to enrich—the future of our research enterprise.” They say they plan to work with the research community “to ensure a smooth transition.” In comments below their piece and on blogs, however, many researchers doubt whether disruption can be avoided.

The new overtime pay rule, released yesterday, will double (from $23,660) the salary threshold below which employers must pay workers overtime for working more than 40 hours per week. The rule specifies that postdoctoral researchers are covered. Because most postdocs work more than 40 hours, employers can either put in place timecard systems and pay them overtime, or—as Collins and Perez suggest—increase their salaries. (Postdoctoral researchers in the humanities whose primary duty is teaching are exempt from the new rule, and will not get overtime pay.)

NIH’s main award for postdocs, the National Research Service Awards (NRSA), sets stipends for the first 3 years—at $43,692; $45,444; and $47,268—that fall below the new overtime threshold. Collins says NIH expects to raise those stipends to exceed the threshold, and postdocs with more experience will likely receive a raise, too.

Although most postdocs in biomedical research are paid directly from investigators’ grants, institutions generally follow the NRSA level as a guideline. And universities and other institutions that employ postdocs working in other disciplines look to NRSA stipends as benchmark, too.

NIH hasn’t said anything about the rule’s overall costs. But the author of the popular Drugmonkey blog notes that a $4000 increase in salary could actually be a $5000 to $6000 boost when benefits are included. And the direct costs for an NIH grant (the funding that goes directly to a lab, not to overhead) often tops out at $250,000. “This will take away jobs,” Drugmonkey predicts. “Fewer postdocs will be hired. Whether this is good or bad … well, opinions vary. But the math is unmistakable.” 

The National Postdoctoral Association (NPA) in Washington, D.C., with support from other groups, such as the Association of American Medical Colleges, urged in comments on the proposed rule that if DOL raised postdoc salaries—NPA suggested to $50,000—the change be phased in over 3 years. The reasoning, says Kate Sleeth, chairwoman of NPA’s board, was so that NIH-funded investigators seeking renewal of their 3-year grants could ask for additional funds to cover their postdocs’ raises.

“We’re delighted that salaries will now go up,” Sleeth says. At the same time, with institutions given just 7 months to comply, “we don’t want it to affect the postdoc pool,” she says. Her group hopes to work with funding agencies “to make sure nothing deleterious happens.” Some leaders in the biomedical community feel there is an oversupply of graduate students and postdocs chasing too few academic research positions, and postdoc numbers need to come down anyway. But Sleeth says her group doesn’t share that position.

The Federation of American Societies for Experimental Biology (FASEB) also supports higher pay and benefits for postdocs but is “conflicted” about the overtime rule, says Howard Garrison, FASEB’s deputy executive director for policy in Bethesda, Maryland. “The regulations will require potentially disruptive adjustments and we’re not sure how they’re going to play out in labs and in institutions across the country,” he says.

Impact varies by discipline

The effect of the new rule on fields outside biomedicine may vary by discipline and institution. Most physical science postdocs working at Department of Energy labs already receive at least $59,000 a year. But physics postdocs at universities may get less, and in other fields, such as chemistry and agricultural research, median salaries are closer to $40,000, so many postdocs could now receive raises.

Major research institutions and universities in large metropolitan areas may be already paying salaries above the threshold, says Stanford University chemist Zhenan Bao in Palo Alto, California. Stanford, for example, raised its base postdoc salary to $50,000 not long ago. “But I imagine [the new rule] will significantly impact many other places, especially in physical sciences, as funding [grant] size is typically smaller than NIH,” Bao says. Some labs may end up relying more on graduate students and technicians, suggests Harvard University chemist George Whitesides.

Chemist Chad Mirkin of Northwestern University, Evanston, in Illinois, who sits on the President’s Council of Advisors on Science and Technology, worries that not only will positions dry up, but perceptions of the postdoc as an “all-out work commitment” that prepares young scientists for a faculty position will change. “When I did a postdoc, money was not my prime motivator—the experience for me (and most who I know) was priceless,” he says.

With reporting by Robert Service, Adrian Cho, and Carolyn Gramling.