“Higher unemployment rates reduce the ability of families to afford college and lead to increased demand for financial aid. Colleges that base their financial-aid decisions partly, or solely, on need faced growing pressure on their financial aid budgets, which usually compete for resources with faculty salaries in institutional budgets,” the report said.

The strain is consistent with Dean of the Faculty William C. Kirby’s cautioning about the College budget. In his 2003 Annual Letter, Kirby warned of impending belt-tightening.

“I must tell you frankly that we aim to do all this, and more, as we enter a period of greater financial constraint than any of us would have predicted a year ago,” he wrote. “We are not immune from the vicissitudes of the national and international economies.”

The small salary increase is consistent with this year’s uncharacteristically low endowment payout, and the ongoing staffing reductions across the University. Given this grim context, salary negotiations for faculty may operate under the shadow of financial strain for the next several years, according to Mendelsohn.

“It’s a fairly flexible process, and it’s sort of understood to be so,” said Niko Kolodny, a first-year assistant professor of philosophy. “Given that you’re negotiating with people you’re working with in the future, you’re somewhat restrained—you don’t want to be too mercenary.”

Kolodny said that he would be finding out his salary increase in July, when his second year officially begins.

—Staff writer Leon Neyfakh can be reached at neyfakh@fas.harvard.edu.