Sunday, September 05, 2010

Administrative Bloat at American Universities


Why is college tuition rising so much faster than prices in general, faster even than the unsustainable rise in home prices that led to a housing bubble (see top chart above)?  Well, here's one explanation from the Goldwater Institute's report "Administrative Bloat at American Universities: The Real Reason for High Costs in Higher Education":

"Enrollment at America’s leading universities has been increasing dramatically, rising nearly 15 percent between 1993 and 2007. But unlike almost every other growing industry, higher education has not become more efficient. Instead, universities now have more administrative employees and spend more on administration to educate each student. In short, universities are suffering from “administrative bloat,” expanding the resources devoted to administration significantly faster than spending on instruction, research and service.

Between 1993 and 2007, the number of full-time administrators per 100 students at America’s leading universities grew by 39 percent, while the number of employees engaged in teaching, research or service only grew by 18 percent.  Inflation-adjusted spending on administration per student increased by 61 percent during the same period, while instructional spending per student rose 39 percent. Arizona State University, for example, increased the number of administrators per 100 students by 94 percent during this period while actually reducing the number of employees engaged in instruction, research and service by 2 percent. Nearly half of all full-time employees at Arizona State University are administrators (emphasis added).

A significant reason for the administrative bloat is that students pay only a small portion of administrative costs. The lion’s share of university resources comes from the federal and state governments, as well as private gifts and fees for non-educational services. The large and increasing rate of government subsidy for higher education facilitates administrative bloat by insulating students from the costs. Reducing government subsidies would do much to make universities more efficient."

MP: For public universities the administrative bloat is much worse than at private colleges - administrative positions grew by 39% between 1993 and 2007, almost four times the 9.8% increase for instructional positions, see bottom chart above.  At private universities, without access to the public largess, administrative and instructional positions increased at about the same rate. 

HT: Chris Douglas

10 Comments:

At 9/05/2010 10:38 AM, Blogger juandos said...

Funny thing, I was just reading this at the Washington Examiner:

Higher education bubble poised to burst

By: Michael Barone
Senior Political Analyst
September 3, 2010

 
At 9/05/2010 11:41 AM, Blogger Buddy R Pacifico said...

Another quote from Dr. Jay Greene, one of the three authors of the study:

"If universities had to rely far more on student tuition payments to fund their budgets, they likely would focus on meeting the classroom needs of those students rather than hiring administrators to fill out government paperwork and handle other tasks unrelated to the core mission of higher education institutions,”.

 
At 9/05/2010 11:49 AM, Blogger NC said...

University administrators don't view the student as customer. They view themselves and professors as the customer. Students are becoming a parasitic load that provides cash flow.

 
At 9/05/2010 12:18 PM, Blogger r l love said...

My wife and I have 2 kids who are currently at Texas State and we have come to rely on my wife's office management experience, which is extensive, to supervise which classes our kids need, or don't need, in lieu of the counseling offered by the school.

The conventional counseling which we assumed to be adequate for the first couple of years was so frequently errant, that my wife simply took it upon herself to oversee the process and she has sorted things out to some extent but our oldest child has ultimately been forced to remain in school a semester longer than she should have due to the poor counseling that was given before my wife's involvement.

I suppose this little anecdote is of little importance here. Perhaps it hints at the notion that more administrators do not bring about better administration... in one isolated case at least, but mostly I am taking this post as an opportunity to complain about something I've been angry over for some time now. Thanks for the opportunity to vent.

 
At 9/05/2010 12:46 PM, Blogger Jason said...

I wonder how much administration is in place to attract and service wealthy donors? From my view, endowment bloat has become sort of an arms race for universities. This constant pursuit of donor bucks must have consequences.

 
At 9/05/2010 1:37 PM, Blogger Benjamin said...

It would be interesting to know how administrative jobs at the Pentagon have grown, vs, actual soldiers and sailors.

 
At 9/05/2010 2:51 PM, Blogger Dr William J McKibbin said...

Given the data about the increase in the numbers of administrators in higher education, one might also consider the increases in administrators in secondary schools as well -- I'm glad I'm still teaching in the college classroom in the meantime...

 
At 9/05/2010 7:54 PM, Blogger juandos said...

"It would be interesting to know how administrative jobs at the Pentagon have grown, vs, actual soldiers and sailors"...

Yeah pseudo benny, all those administrators in the Pentagon used to be farmers...

What's interesting now is some of the splash back regarding that Goldwater Institute study...

ASU responds to Goldwater Institute report

ASU claims there is five flaws in the report...

William E. Kirwan is chancellor of the University System of Maryland claims in a Baltimore Sun opinion piece: Administrative 'bloat' in higher ed? Not really

University of Maryland an example of responsible stewardship

 
At 9/06/2010 11:34 AM, Blogger DrPutt said...

One issue not mentioned here is that many public universities have been forced to "bloat" their administration to keep up with all the accountability requirements by state legislators. In the last 10 years an every increasing portion of my time is spent completing an almost endless array of forms, reports, etc. that contribute very little to the educational process and in the process, do very little to ensure that faculty are really doing their jobs.

 
At 9/07/2010 10:06 AM, Blogger juandos said...

"In the last 10 years an every increasing portion of my time is spent completing an almost endless array of forms, reports, etc. that contribute very little to the educational process and in the process, do very little to ensure that faculty are really doing their jobs"...

Excellent point DrPutt...

 

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