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Pushing The Sky Up In Boston

The Boston Symphony Orchestra (BSO) recently wrapped up a new three year collective bargaining agreement (CBA) that flies in the face of the Chicken Little Think Tank sky is falling doctrine. Normally, we wouldn’t spend time looking at what amounts to a typical contract with standard improvements but given the recent concessionary agreement in Philadelphia, it seems appropriate to examine some of the contract provisions.

Pushing The Sky Up In BostonHere are the contract highlights:

  • Wages (three percent increase per year): 2011-12, $132,028; 2012-13, $135,980; 2013-14, $140,088.
  • Pension (Private): Increases $2,000 to $77,000.
  • Orchestra Size: Unchanged at 101 members.

 In addition to those point, there were some mild increases for weekly premium sharing for employees enrolled in the PPO health plan health care and management and musicians agreed to form a Health Care Task Force to work on the rapidly changing landscape of health insurance.

It is worth noting here that not only did the BSO keep the existing defined benefit pension plan but they actually increased the annual payout. That’s an extraordinary event in light of other larger budget orchestras ditching their defined benefit plans in favor of defined contribution alternatives.

After inserting the BSO’s recent changes into last week’s chart (and editorial cartoon fodder) on the competitiveness of larger budget orchestras to attract and retain top talent it appears that that the BSO, at the very least, is going to hold its own (the BSO, in green, has been highlighted).

Competitive edge among large budget orchestras

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5 Responses to Pushing The Sky Up In Boston

  1. Jon Silpayamanant October 26, 2011 at 11:52 am #

    Excellent news, and great corrective for the Chicken Little Think Tank folks. Drew, when you posted that piece about the NBA which (if I remember correctly) said that roughly a third of the teams were losing money (at the time of that piece) while the industry as a whole was making money–is that generally the case with Orchestras?

    Meaning, at any given time are there always a significant proportion of orchestras that struggle while others are breaking even or even making a profit? Has there ever been a time when all (or practically all) orchestras were doing well. Also, was there ever really a time that all or most orchestras were struggling (other than the obvious WPA Orchestra period and before that)?

    It just seems like so much of the Chicken Little Think Tank is premised on what we can an Availability heuristic cognitive bias. In other words, the frequency of an event (the demise of individual orchestras) is based on how easily an example can be brought to mind which is helped by the tendency of media to focus on so many of the negative examples in the industry rather than the positive ones.

    I think having a more comprehensive picture of orchestras could be so helpful a corrective, especially if this is a regularly occurring cycle that eventually self-corrects!

    • Drew McManus October 26, 2011 at 11:59 am #

      I’d recommend against engaging in any sort of making money/losing money framed discussion for nonprofit performing arts groups without first defining parameters and exceptions. But regarding the issue of the ratio of groups doing well vs those who don’t, that’s always been the case within the field. In that respect, it is no different than most other businesses. Success is influenced by a number of unique variables, some of which are external and others that are internal. What I suggest is looking at individual situations to define those variables and reverse engineer to find applicable connections to either reaffirm decisions or help identify additional options.

  2. Geo. October 26, 2011 at 5:39 pm #

    It’s especially fascinating and heartening to read this news about Boston, although there are several key differences between Boston and Philadelphia, like the new hall in Philadelphia, which is probably the big financial difference, as well as the whole Eschenbach tenure controversy from years back. Boston obviously doesn’t need a new hall and isn’t saddled with any expenses from such a venture. However, it is true that the instability of Levine’s health and his departure must have been some sort of drag on the situation there, but at least his departure brought closure. I’ll admit that I’m not aware of how attendance at the BSO has been, which is another issue to wonder about compared to Philadelphia.

    • Drew McManus October 26, 2011 at 5:47 pm #

      Those are all very good points and I think anyone would be hard pressed to make a case that the BSO isn’t in better financial shape than Philly and clearly, one of the reasons for the latter’s debt is, as you mentioned, the hall debacle. But what’s interesting to note between the two is Philly actively sought to not only acquire wage concessions from musicians but to replace their defined benefit pension plan, which they claimed in bankruptcy proceedings was one of the drains on the institution (along with hall related expenses).

      The fact that Boston not only retained but increased the defined pension plan shows what could be defined as a fundamental difference in strategic governance and executive prowess. Time will tell.

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  1. Summary of Recent Negotiations at American Orchestras | Song of the Lark - June 11, 2013

    [...] raise in base salary…each year. By the end of the 2013-14 season, base will be at $140,088. Read more here, and here’s the ICSOM settlement [...]

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