In the 2017 State of the Commonwealth Report, authors Robert M. McNabb and James V. Koch address the perennial question of why the price of higher education is increasing so much faster than everything else. While acknowledging that stagnant state financial support for the higher-ed system has played a contributing role, they insist that’s only part of the story.
As evidence, they proffer the graph seen above. The red line tracks the increase in the Consumer Price Index (CPI). The green line shows the cost of room & board, which relies on charges to students, with no contribution from the state at all. That cost has risen consistently over twenty years at about twice the rate as the CPI. The orange line shows mandatory student fees, which also receives no state funding. That cost has risen about three times the increase in the CPI. Together, the two categories account for roughly half the expense of attending college.
Tuition, the blue dotted line, rises at a rate somewhat faster than room and board. That’s the only piece influenced by the level of state aid. What factors other than state support might influence the cost of tuition? McNabb and Koch offer several in this list of factors driving up the overall cost of attendance (including tuition, fees, room and board), which I replicate here almost verbatim:
- Institutional concern with national rankings is epitomized by U.S. News & World-Report rankings. Fixation on rankings can lead to decisions divorced from the needs of taxpayers, students and families.
- Amenities competition stimulates institutions to offer such things as recreational spas and climbing walls as well as upscale (and expensive) food services.
- Institutions often construct new, spacious buildings even though it is costly to maintain this space, and utilization of existing space is surprisingly low. A 2014 study by the State Council of Higher Education for Virginia (SCHEV) disclosed that no residential four-year campus in the Commonwealth of Virginia utilized its classrooms more than 76 percent of reasonably available hours, and three campuses ranged below 60 percent usage. Parenthetically, it is not clear that adding significant new space is an intelligent public policy when internet-based instruction is expanding and head count enrollments are declining. Modernization and rehabilitation of existing space may make more sense and be less expensive.
- Institutions increasingly assess mandatory fees to support items ranging from student centers to athletic teams. In 2016-17, eight Virginia four-year public institutions charged their full-time undergraduate students athletic fees of $1,538 or more. Consider Christopher Newport’s $1,886 annual fee. This corresponds to a charge of $188.60 per three-hour undergraduate course. Doubtless, CNU’s Captains are well regarded, but they also are expensive, and students bear a substantial portion of that cost.
- The growth of institutional room and board charges at most Virginia institutions easily has exceeded the growth of the consumer price index. First-rate residence halls and excellent food are pleasing, but costly.
- Administrative proliferation (as measured by the number of administrators per faculty member or student) exists on most campuses. Further, these administrators tend to be paid well.
- Institutions have reduced the proportion of their budgets they spend on instruction.
- Disproportionate growth in spending on employee fringe benefits (which sometimes have substituted for pay raises during difficult years) has pushed tuition and fees upward.
- Federal government financial aid policies are based upon institutional costs. Hence, when institutional costs increase, the “feds” supply more money.
- Institutions are reluctant to take advantage of new teaching and learning technologies, flipped classrooms and other innovations that have the potential to scale higher education.
- Institutions are disinclined to share resources with other institutions, even in low-enrollment areas such as foreign languages and literatures.
- Institutions are averse to pricing the resources they use internally, such as space, and this leads to suboptimal behavior and hoarding.
- Institutional mission creep has propelled many institutions into offering new, low-enrollment programs, often at the graduates level.
- Faculty productivity, as measured by faculty credit hours generated, has declined on most campuses.
- Subsidies from undergraduate students often are required to support faculty research activity and this is true even in cases where the research also is supported by outside grants.
While the influence of these factors varies widely from institution to institution in Virginia, the authors acknowledge, “collectively, these are among the primary reasons why tuition and fee increases at Virginia’s public colleges and universities not only have vastly exceeded the growth in the consumer price index and median household income, but also why they have been substantially higher than the national average.”
Bacon’s bottom line: While I agree with the thrust of the McNabb-Koch analysis, I would be more circumspect in concluding that the factors listed above are “the primary reasons” for tuition and fee increases. In many cases, we just don’t have the data to say one way or the other. Despite that reservation, I think the list provides several fruitful lines of inquiry, and I suspect that the data would prove the authors correct in many instances.
Space utilization. To what extent, for example, is space underutilized on Virginia campuses? Every institution provides a different story. When Norfolk State University saw its enrollment plummet several years ago, for example, its space utilization went down as well. Utilization should improve as enrollment rebounds. Elsewhere, research universities cite the need for new buildings outfitted with specialized laboratories or other features to pursue advanced scientific and engineering disciplines, even if it means leaving former space underutilized. Thus, there may be legitimate explanations for temporarily low space utilization. However, I would agree that every college or university president should include in his or her dashboard of institutional performance a metric showing the utilization rate for individual buildings and campus-wide.
Low-enrollment programs. How many universities maintain low-enrollment programs? Which departments are fully enrolled? Which are under-enrolled? If I were a university board member, I would like to see a faculty-to-enrollee ratio for every department. If a department had persistently low enrollment, perhaps it should receive fewer resources — or perhaps it could compensate by pursuing more online enrollment. Do university presidents even collect that data?
Faculty productivity. My sense is that faculty productivity has declined over time, especially for tenure-track faculty members who are subject to the publish-or-perish dictum. What is the relative teaching load for full professors, associate professors, assistant professors, instructors, and graduate institutions? How many courses do they teach — and how many students are enrolled in those courses? This data should be readily available, and there is no excuse for institutions not compiling and publishing it.
McNabb and Koch are both industry insiders — Koch is former president of Old Dominion University. As long-time participants in the academic enterprise, they know how higher-ed works. They have tremendous credibility. Let’s hope that Virginia’s political class is paying attention.