Home / General / Higher ed revenue has exploded, but guess where that money’s not going?

Higher ed revenue has exploded, but guess where that money’s not going?

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Here are some numbers that illustrate, among other things, how and why the relationship between management (upper administration) and labor (in this case, the faculty) in American higher education is becoming increasingly adversarial and hostile.

Average salary for full time faculty, 1970-71 (2021-22 dollars) and 2021:

Full professors: $127,488/$130,262

Associate professors: $96,282/$92,222

Assistant professors: $79,343/$79,398

Instructors: $66,448/$72,503

Lecturers: $79,585/$67,454

All Full-Time Faculty: $90,231/$93,892

So that’s basically no average salary increase over 50+ years.

Over this same time frame, the Social Security Administration’s average wage index has gone up by 35.6%, so full time faculty in America’s colleges and universities have done terribly relative to the average American worker over the past half century, which also hasn’t been that great of a half century for the average American worker.

But wait, there’s more.

Percentage of faculty who were full time in 1970 and 2021 respectively: 78% and 56%.

Ratio of full time faculty to total student enrollment:

1970: 21.7 students per full time faculty member

2021: 23.4 students per full time faculty member

So since part time faculty get paid nothing, the cost savings in regard to faculty salaries between 1970 and 2021 has been, shall we say, substantial. (Yes benefit costs have gone up a lot, mainly because we have a horrible system for distributing health care costs here in FreedomLand).

Meanwhile, let’s take a peek at those revenues:

Total revenue of American colleges and universities in 1970-71, in 2021 dollars: $149.881 billion.

Total revenue of American colleges and universities in 2019-20, in 2021 dollars: $695.117 billion.

How does that work out when you divide it on a per capita student basis?

Like this:

1970-71: $18,735

2019-2020: $35,411

Source for faculty salaries, faculty student ratios, and higher ed revenues: Digest of Education Statistics, National Center for Education Statistics

Social Security National Average Wage Index

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