Lasher and Greene (2001) state that cost disease the inability for an institution of higher education to utilize technological advances to cut costs and increase productivity. Further, this is the precise reason that costs in the industry continue to increase (Lasher & Greene, 2001). There is an endless list of reasons for cost disease in higher education and an endless list of people willing to discuss those reasons as well. One of the examples of cost disease that I came across in my research of the subject was “administrative bloat.” Administrative bloat is said, by some, to consume much needed state and federal subsidies. Because a larger portion of those funds must now be given to administrative costs, additional funding is needed. In other words, costs continue to increase.
According to a policy report offered by Jay Greene of the Goldwater Institute in August of 2010, the number of administrators at American colleges and universities has been on the rise for some time. Greene (2010) explains that the number of administrators per 100 students rose by 39% between the years 1993 and 2007. He further explains that the amount of money spent on administration at the schools observed (called “leading universities” in the report) grew by an astounding 61%. What is most alarming is that this “bloat” is said, by the author, to come at the expense of faculty growth and productivity. Using Arizona State University as an example, Greene was able to illustrate the gravity of the situation. ASU’s administrative body is said to have grown by 94% during that 14-year period while teaching and research staff was reduced by 2%. This problem is becoming quite common apparently as professors from other schools have voiced similar concerns. Barrett (2011) discussed the concerns of two Johns Hopkins professors stating that the two believe that “universities have shifted their resources and attention away from teaching and research in order to feed a cadre of administrators…” (para. 5). How is the growing “cadre of administrators” fed? Many would argue that they are fed through requests for more money from government, donors, and students.
How are we to solve this growing problem? The answer depends on the possible causes of administrative bloat. If the growth in administrative bodies is simply due to a rapidly expanding student body, then the increase in tuition dollars and subsidies (based on that student body growth) brought in by more students would be sufficient for supporting new personnel. However, that is not the case. Increases in government subsidies often make administrative bloat possible (Greene, 2010). While Greene makes no honest suggestion on how to solve the problem he does state that a reduction in government subsidies “would do much to make universities more efficient” (p. 1). While this would absolutely force institutions to “make do” with fewer administrators, I do not think it is a productive strategy to simply cut funding. Although, regulating the manner in which the current level of public funding is used (for instance, requiring that they be used in an “instructional” capacity) would require the money to be used on things that could truly make the institution more efficient (i.e. technology, instructors, etc.). This would also prevent the massive increase in tuition levels that would undoubtedly follow the cut in public funding that Greene suggests.
References
Barrett, D. (2011, July 18). Inside higher ed: The fall of the faculty. The Times Higher Education. Retrieved from http://www.timeshighereducation.co.uk/story.asp? storycode=416841
Greene, J.P. (2010). Administrative bloat at American universities: The real reason for high costs in higher education (Report No. 239). Retrieved from http://www.goldwaterinstitute.org/ article/4941
Lasher, W.F., & Greene, D.L. (2001). College and university budgeting: What do we know? What do we need to know? In M.B. Paulsen, & J. C. Smart (Eds.), The finance of higher education: Theory, research, & practice (pp.501-534). New York: Agathon
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