Let’s start at the top.
According to an analysis by the Chronicle of Higher Education, in the 2011 fiscal year, 132 presidents of public colleges and universities made $344,000 or more — the income level that marks the divide between the bottom 99 percent and the top 1 percent. Private-college presidents raked in even more: 208 made $344,000 or more in 2010, with 36 of those making $1 million or more.
But focusing in on one man’s salary is the old CEO fallacy. Expenses don’t get bloated to unsustainable levels by one man, unless he’s the former CEO of TYCO, but they often do say something about the spending culture and bureaucratic bloat underneath.
Like many public colleges, the University of Minnesota went on a spending spree over the past decade, paid for by a steady stream of state money and rising tuition. Officials didn’t keep close tabs on their payroll as it swelled beyond 19,000 employees, nearly one for every 3½ students.
Many of the newly hired, it turns out, were doing little teaching. A Wall Street Journal analysis of University of Minnesota salary and employment records from 2001 through last spring shows that the system added more than 1,000 administrators over that period. Their ranks grew 37%, more than twice as fast as the teaching corps and nearly twice as fast as the student body.
Across U.S. higher education, nonclassroom costs have ballooned, administrative payrolls being a prime example. The number of employees hired by colleges and universities to manage or administer people, programs and regulations increased 50% faster than the number of instructors between 2001 and 2011, the U.S. Department of Education says. It’s part of the reason that tuition, according to the Bureau of Labor Statistics, has risen even faster than health-care costs.
This isn’t just true of colleges, it’s also true of much of American business, but it’s a serious problem in education, both higher and basic, because the bureaucratization of education is paid for by public money.
Administrative employees make up an increasing share of the university’s higher-paid people. The school employs 353 people earning more than $200,000 a year. That is up 57% from the inflation-adjusted pay equivalent in 2001. Among this $200,000-plus group, 81 today have administrative titles, versus 39 in 2001.
Administrators making over $300,000 in inflation-adjusted terms rose to 17 from seven.
Many forces besides administrative overhead add to universities’ cost pressures, among them health-care and retirement expenses. And among the administrative spending, some is unavoidable, such as that owing to federal rules requiring greater spending to oversee research grants or accommodations for students with disabilities.
Federal regulations are of course a major driver of bureaucracy. Regulations require more administrators. The more regulations there are, the more administrators have to be put on the job.
The number of employees at the University of Minnesota with “human resources” or “personnel” in their job title—272—has increased by a third since the 2004-2005 academic year, a period during which the enrollment grew approximately 8%.
In its Office of Equity and Diversity, the number of people with “director” in their title grew to 10 in the 2011-2012 school year from just four directors five years earlier, by a university official’s count.
Political correctness is always good for bloat.
The Journal, using payroll data provided by the university, calculated that across all of the system’s campuses, administrators consume 24% of the payroll, up from 20% in 2001. Employees who teach, such as professors, lecturers and instructors, account for 37% of the payroll, down from 39% in 2001,
Several years ago, Russell Luepker, a professor of epidemiology at the school of public health, sought reimbursement for a $12 parking bill. The form went from a secretary to the head of his department to an accountant who entered it in a computer to a senior accountant responsible for approving it. Richard Portnoy, chief administrative officer in the epidemiology department, estimates it cost $75 to move the paperwork. When Dr. Luepker heard of it, he stopped filing for parking reimbursements.
This is your education. This is your education on bureaucracy.