The $100/$10 Dues will significantly increase IEEE membership
Can IEEE Afford to Reset Member Dues to $100?
You will see the answer is YES.
IEEE is a very wealthy technical services/product company. IEEE Business Revenue, Profits (Net Revenue) & Net Assets have shown significant growth. However, IEEE Member Revenue has started a slow decline, because the number of members who pay full dues has been declining. A major source of IEEE’s profit comes from IEEE members who volunteer free hours to the business side of IEEE. Members contribute at least 1 million hours/yr. If IEEE staff had to be hired to cover these 1 million hours, $56 million in compensation cost would be added to IEEE expenses. Therefore, it is in the best interest for IEEE to significantly add more IEEE membership, which would significantly increase the number of free volunteer hours. The fastest and easiest way to increase membership is to lower IEEE member dues to $100. $100 member dues will increase membership at least 10%/yr. That means in 7 years IEEE membership and revenue will double!
The above financial table shows IEEE is so successful it can actually offer FREE MEMBERSHIP and still make a profit in future years!!!
The following spread sheet shows how IEEE membership has changed from Jan. 2019 to Dec. 2021.
You can clearly see that where members are paying the highest dues membership is declining the most. As members pay lower annual dues fewer members are quitting. Member dues around $157 seems to be the point where either membership is relatively flat or increasing. Imagine what membership growth there would be for all Regions around the world, if annual dues were just $100/yr.
$100/$10 Plan Impacts
- More current members will renew their membership.
- IEEE will attract significantly more new members because dues are affordable.
- IEEE will encourage members who quit to rejoin because dues are affordable.
- Young professionals will start joining because dues are affordable.
- Membership growth in every Region will vary. Region 1 to 7 will grow the fastest.
- New Society membership/revenue growth will be immediate!
- $100 dues will encourage members to use the money saved to join more Societies.
- With $100 dues growth as low as 10% membership/revenue will double in 7 years.
- Volunteer hours will double within 7 years greatly increasing IEEE’s business revenue.
All new business initiatives have start up costs in excess of revenue in the early years. The $100 member plan is no exception. But, the expected rapid membership growth will quickly increase membership revenue, which will minimize the short term the early losses.
For-profit businesses have the following ways to cover start up revenue losses:
- Issue shares in the business (not an option for IEEE)
- Obtain a business loan (an option for IEEE)
- Reduce expenses by means of cost reductions (an option for IEEE)
- Reduce net assets in the short term (an option for IEEE)
Based on current IEEE business revenue, the early short term member revenue losses can be fully covered by using options 2, 3 & 4.
There is an immediate way to pay for the early short term member revenue loss. IEEE currently spends $30 million/yr. on printing and distribution costs. By starting to offer electronic publications IEEE can use these huge savings to cover the early $100/$10 Plan member revenue losses in the first 3 years.
IEEE also has another option to cover short term revenue losses. Because IEEE’s net assets are so large, these assets contribute a substantial annual investment revenue stream in excess of $10 million/yr. Per IEEE IRS 990 tax filings in 2019 this investment revenue stream was $13.9 million. In 2020 it was $11.3 million. The IEEE investment revenue stream can be used to cover any short term member revenue loss that results with the implementation of the $100 plan. These losses are smaller than the investment revenue. Examples of using this revenue stream are shown following the 3 growth model simulations.
Three $100 plan member growth simulation models shown below on this page will demonstrate how quickly new IEEE membership and revenue can be achieved.
Yearly increases of full dues paying IEEE membership will reach a point where revenue exceeds the cost. Further membership growth will provide enough revenue to pay back the early losses. Once this is accomplished further membership growth will produce increasing profits and net assets.
$100 Dues Financial Impact On Your Section
Each year IEEE gives your Section money based on the # of members in the Section. With more members renewing & more new members joining your Section’s financial support will increase. This means your Section will have more resources to invest in local community activities, such as STEM projects for grades 1-12, undergrad projects, community awards, Section member awards. Etc.
Historic IEEE Member Growth Rates
- Today fewer members are renewing their membership than they did years ago.
- Between 1980 – 1990 IEEE membership grew between 20% to 30%.
- Between 1991 – 2000 IEEE membership grew on average 12%.
- Between 2000 – 2010 IEEE membership grew between 5 to 10%.
- In 2013 IEEE membership stopped growing.
- Today IEEE membership is falling by -2.6%.
How much can you save with $100 dues?
The table below shows the amount of money a member will save and the discount a member will receive when IEEE fully paid dues are reset to $100/yr.
Listed below is a table of 3 growth simulations, which will show the financial impact to IEEE. Yearly member growth rates of 10%, 15% & 20% are simulated. Currently Regions 9 & 10 have on average 2% & 3% annual growth respectively with current dues of approximately $160/yr. It is highly reasonable that $100 dues will produce at least 10% yearly growth for Regions 9 & 10.. I would expect Regions 7 & 8 to easily have 15% growth. US Regions most likely will have 20% plus yearly growth rates given their 51% discounts. The 3 simulations below assume all Regions have the same growth rate. It is possible to run a simulation with different growth rates per Region.
Assumptions Used For $100 Plan Growth Simulations
There are common assumptions for all 3 simulations:
- Statistically for each member there is a .79 corresponding Society member.
- Average Society dues are $29.40.
- Because both current and new members will save money, I conservatively estimate 1 in 4 will join at least one more Society. I call this the Society bonus.
- IEEE’s expense of $500 million and net assets of $720 million will remain constant during the simulation years.
The member revenue of the 3 growth simulations in the table below includes Society revenue related to member growth and the Society bonus.
The 10%/yr membership growth is the worst case simulation and generates the largest member revenue loss over a 3 year period. The tables above show how these losses can be covered so that the net revenue for those years have no negative impact on IEEE’s net revenue (Profit).
For years IEEE huge net assets do nothing but produce over $10 million in investment income. Option 1 uses the investment income from IEEE’s net assets to cover the revenue loss for each year. The net assets of $720 million for each year is used. For the 10% growth model investment income totally covers the member revenue losses. In all cases not all investment income is required. For the 15% and 20% growth models the amount needed to cover member losses is much smaller.
Option 2 uses IEEE’s net assets of $720 million to cover the member revenue loss. The percentage drop in net assets is only 1.8%, 1.2% and 0.6% respectively for each year. This is a very minor impact on net assets. For member growth of 15%/yr and 20%/yr the impact is even smaller and the pay back occurs a year earlier.
Option 3 uses IEEE’s total year expenses of $500 million to cover the revenue loss. The needed cost reduction of the total expenses for each year is 2.5%, 1.8% and 0.9%. Just the transition from paper publication/distribution to more electronic publication/distribution will easily cover the member revenue losses in the first 3 years. Smaller cost reductions are needed in the 15% and 20% growth simulation models. For-profit corrosions routinely target yearly 5% expense cost reductions to protect profits and net asset growth.
IEEE has no need to use outside loans to cover the short term member revenue unless there is a tax benefit to do so.
If you agree that the above growth simulation examples have shown the potential of having a major positive impact on both IEEE member/revenue and IEEE Society member/revenue growth, please go to the Join Us page and become a grassroots member so we can keep you informed on the many ways you can encourage IEEE to reduce your dues.
The express opinions on this website are not necessarily the opinions of IEEE.