US colleges are cutting majors and slashing programs after years of delays
abcnews.go.com
abcnews.go.com
“univ of Solaris” just upgraded their facilities so “Solaris state” feels compelled to compete or risk losing out on attracting top talent. Over decades, this means basically every higher education facility has a ridiculous amount of space that’s completely under utilized or poorly utilized. Spaces that look great during admission tours, but don’t actually get used.
I went to a small, rather frugal private university. They largely escaped the “chasing the jones”. Even then, I could walk through dozens and dozens of labs that were only utilized 10 to 20 hours per week. The worst of these offenders were the “modern” labs that always got shown in the tours. Some of them might host a single class per week for a single semester per year.
At the big universities, it seems even worse.
These utilization rates would have any regular business questioning the need for their expense in it.
A single class per week is ridiculous, though.
Many businesses use a college degree as a blunt hiring filter. This increases demand for degrees if only to check a box.
Baumol’s Cost Disease. Anything that is done manually cannot be automated and therefore requires a lot of labor input. So services continuously rise in price unlike mass produced goods that get cheaper over time. The same phenomenon affects childcare, live performance art, non-prefab construction, crops that are picked by hand, and nursing homes.
State governments have decreased funding. So more money has to come directly from state college enrollees.
Many colleges are in a ranking arms race instead of truly prioritizing affordability. Recruiting star professors and building new facilities is expensive.
Community colleges cut out a lot of non-essential services. It’s how they’re able to offer instruction at a tenth of the tuition.
There is one more factor. People at 18 aren't really fit to make such huge financial decisions, most of them don't have experience handling even 0,1x that amount of money. They are still pushed to, and the other party is much more experienced and stronger than them.
It is a masterpiece of college politics that students tend to turn "anti-Capitalist" and attack greed of private corporations, while completely ignoring that they are being fleeced in a predatory way by their own schools. Academic institutional greed is the true 400 lb gorilla in the room that few are capable of acknowledging.
That's what I've always read: that it's a simple and effective filter for going from a mountain of job applications to a hill of them.
[1] There are the standard places to define like Wikipedia. The link I offer here is an A16Z podcast with Marc Andreesen and Vijay Pande where Marc gives an overview about 3 minutes in.
https://a16z.com/podcast/baumols-cost-disease-in-healthcare-...
[2] https://aa.org
Additionally, if professor pay is too high, there is probably room to cut it without much harm, considering there is an oversupply of grad students who would love to make tenure but don't have a chance due to so few slots available.
1 full time professor can provide an education to 20 students. You can pay this professor $100,000, and spend another $100,000 on taxes, overhead, etc. That's $10,000 per year. Where's the other $50k come in?
There is lots of waste. Replace these fancy campuses with a building like an inner city high school and replace the many administrators with a volunteer faculty committee and a couple of paid administrative assistants.
Run colleges like high schools but with higher paid, better educated teachers. The damn building and other luxuries don't matter. All a good teacher needs is 4 walls, paper, and a classroom of willing souls.
Average annual tuition at private 4 year colleges is $38k. Average faculty to student ratio among these schools is 10:1. Average salary for a professor at these schools is $134k.
In other words, about 35% of college tuition revenue is going to faculty paychecks. This does not include staff, who are lower paid but far more numerous. For context, in a for-profit business, typically 15-30% of revenue goes to payroll. Then you have overhead for all these employees.
And it's not like these people are being paid particularly lavish sums. If anything for their experience level they are typically underpaid. Education is just an incredibly labor intensive field. It doesn't help that having a low student:faculty ratio is seen as one of a university's most important metrics, so efforts to improve labor efficiency are disincentivized.
Throw in facility upkeep, insurance, costs of marketing and recruitment. These institutions are generally not printing money.
Yeah, the top few dozen schools with strong alumni networks and massive investment portfolios are flush with cash, but there are thousands of schools that aren't.