In 2010, Jay P. Greene released an eye-opening report, “Administrative Bloat at American Universities: The Real Reason for High Costs in Higher Education.” He wrote:
“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.”
Since then, there has been considerable follow-up research. The newest addition to the administrative bloat story comes from Robert Kelchen, assistant professor of higher education at Seton Hall University. In a recent blog post, he examined administrative growth by sector and purpose. His results were surprising:
“The data suggest that there has not been a massive explosion of high-level administrators, but there has been substantial growth in low- to mid-level academic support and student services staff members.”
This contradicts the conventional wisdom that the problem has been a proliferation of provosts, vice provosts, deans, assistant deans, and other upper-level administrators. But it certainly explains at least part of the increasing cost of higher education. Even low-level administrators don’t come cheap.
There are many possible explanations for this phenomenon. Kelchen posits a few, including the hypothesis that students are demanding more services than in the past.
Of course, that may be the case. But the underlying cause was explained in the 1980s. Howard R. Bowen explained this in his book, Costs of Higher Education, a revenue theory of cost for university spending—including spending on administration.
His theory can be summarized into four rules (with my comments in italics):
- The main goals of higher education institutions are excellence, prestige, and influence, measured in various college rankings as top administrators’ opinions of their “peer” institutions.
- There is virtually no limit to the amount of money colleges and universities can spend
to increase these qualitative and reputational improvements. (e.g., the spending can go
to more administrators and better student “services”)
- Each institution raises as much money as it can, in order to keep up with the Joneses (aka the Ivies).
- Because there is no profit that is disbursed to shareholders, as there would be with private corporations, and therefore no need to hold down costs, the institution spends all the money it raises. And of course, once a bureaucracy is in place, it’s very hard to cut.
The only way to end administrative bloat, then, is to cut off its sources of funding. Students, parents, states, and the federal government must reward efficiency and real academic activity on campus, not ever-growing administrative activity.