Fifty Years of Mustangs

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The Ford Mustang is just over fifty years old now, having first been released in 1964. The first model had a list price of just under $2,500, which equates to (heaven help us) about $18,500 now, according to inflation data from the Bureau of Labor Statistics.

A 2016 Mustang starts at a base price of about $25,000, which means that its price has increased at about 35% beyond inflation. Why is that? Because we expect more from cars than we did before. Antilock brakes, fuel injection, traction control, disc brakes, transmissions with six speeds instead of four, air bags, electronic power steering… there’s a long list of things that are standard features in every contemporary car that wouldn’t have been available at any price in 1964.

This is relevant to our purposes when we look at the American Institute of Research’s (AIR) Delta Cost Project, an examination of higher ed finance trends. In their report “Labor Intensive or Labor Expensive: Changing Staffing and Compensation Patterns in Higher Education“, they investigate the question of “administrative bloat.” The most common complaint is that higher ed executives are sucking up all the money that ought to more appropriately go to direct educational costs. But AIR has discovered that across almost all institution types, the percentage of staff within the “executive, administrative and managerial” category has remained almost perfectly level between 2000 and 2012. What HAS changed is the category labeled “professional”. To use AIR’s language,

Professional employees— such as business analysts, human resources staff, admissions staff, computer administrators, counselors, athletic staff, and health workers—are the largest group of noninstructional staff on campus. These positions typically either support the business functions of colleges and universities or provide noninstructional services to students.

To use one category of colleges, public research universities, we see the following changes in personnel per 1,000 FTE students (expressed as 1990 value/2012 value/% change):

  • Full-time faculty 62/64/+3%
  • Part -time, adjunct, graduate student faculty 50/83/+66%
  • Executive, administrative, managerial 14/11/-21%
  • Professional 53/73/+38%
  • Non-professional 114/63/-45%
  • Overall 293/294/+0.3%

So bad luck for you if your parents were higher ed clerks or secretaries or building maintenance workers, those stable working class jobs that raised families—half of those jobs are gone in the past twenty years. But the nearly 40% growth in professional jobs, people without direct student contact who direct the larger initiatives of the institution… that’s where the growth is. Those jobs pay well, require advanced degrees—many with doctorates, like all the directors of high-impact practices or sponsored research offices—and cost a ton of dough. The growth in part time, contingent faculty is the balancing factor, the three-grand-per-course compression fitting that allows the professional community to expand.

The director of undergraduate research… the coordinator of international admissions… the director of orientation and new student programs… those are the air bags and fuel injectors of higher education, unimaginable to be present in 1964, unimaginable to be absent in 2016. Let’s be direct; the salary of one professional staff member is more or less analogous to one tenure-track faculty member. But we’ve decided to increase professional staff by 40% and faculty by 3%.

The benefits of this shift to the institution are that administrators exercise more power in the name of “coordination” of all those cross-departmental projects; professional staff have no start-up costs; and professional staff can be hired, reallocated, and fired without consulting a union or a faculty senate or addressing tenure concerns. (They do, however, suck up a BUNCH of travel money…)

Howard Bowen, in his 1980 book The Costs of Higher Education, posited five laws of higher education finance, one of which is that “there is virtually no limit to the amount of money an institution could spend for seemingly fruitful educational ends.” This is as true of colleges as for cars. The 2016 Mustang is indisputably a better car than its 1964 counterpart, thanks to our contemporary expectations for performance and safety. It’s less clear whether the 2016 university is as clearly superior to its ancestors. (We’ll talk in more detail in another post to come about the ways that it IS superior—addressing the needs of a much more diverse student body, for instance—and the ways that it isn’t.)