Faculties are aging along with the rest of society. Low retirement rates and slow growth limit the number of new hiring opportunities in many institutions. Universities face a series of common challenges that will shape higher education in the 21st century. In order to maintain high quality faculties in the coming years, universities must develop compensation policies and employment practices that are appropriate for the new economic and demographic environment. This paper examines existing human resources (HR) policies and considers potential modifications that will enable institutions to recruit, retain, and retire faculty in the coming years. The analysis reviews the soaring cost of health insurance for active and retired faculty and how these plans are being amended. We also review the widespread adoption of phased retirement plans and the use of early retirement programs as components of HR policy. The increasing reliance on nontenure track faculty is also described. The analysis focuses on the challenges that universities face in the current economic and demographic conditions and the methods that administrators can adopt to fulfill their teaching and research missions. The paper presents the results from a national conference consisting of new research and intense discussion by scholars, administrators, policymakers, and HR consultants.