Some secrets are clearly hidden.
We often hear that the economic challenges of higher oaths lie primarily in cuts in state aid per capita. Population and increases in:
- Fixed costs (for salaries, benefits, maintenance and operation and technology).
- Expenditure on expensive new and growing fields of study (eg Animation, games and new media, artificial intelligence, computer science, computational social sciences, data analysis and informatics, financial technology, human-computer interaction, machine learning, neuroscience and sustainability).
- Administrative and student support and student living expenses.
- Care standards (the increased expectations for facilities and services).
There is obvious truth in this explanation. But there is also reason to believe that this explanation is partial, misleading and unfortunate.
After all, the cost of instruction and faculty is stagnant, largely subsidized by the increasing dependence on helpers and other conditional instructors.
It is clear that other factors are at play.
Note: I do not refer to the usual suspects cited by higher eds critics, such as administrative bloating or gilded conveniences and star architecture.
Nor do I claim that this is primarily a product of expenses designed to increase student well-being and academic success, such as hiring non-permanent professionals, including education technologists, instructional designers, teaching and learning center specialists, or therapists; .
While these expenses have clearly grown, many of the students pay themselves through various dedicated fees.
Something else is going on that deserves our attention.
Over the last quarter of a century, many colleges and universities embraced a new business principle: Grow or die. Growth may lead to increased enrollment or eavesdropping on new markets, but it often leads to expansion outside the institution’s traditional core. It helps explain the various partnerships that colleges and universities have signed, not only with online presenters and technology providers, but partnerships with student housing and buildings and various forms of joint ventures, including research parks, research stations and mixed-use development projects.
Even as tuition costs disappeared, institutions redirected additional resources to:
- Development and government relations.
- Highly expanded online master’s, certificate and professional programs.
- Funded research, including new research centers, accelerators, incubators and innovation hubs, technology transfer and public-private partnerships – which in turn results in more soft money employees and a greater need to free faculty-forming faculty from teaching responsibilities.
Meanwhile, colleges and universities have increasingly relied on ancillary services – from dormitories and food services to summer programs and campus rentals – as revenue generators.
Sometimes the shift to new areas is dramatic. In Texas, the University of Texas at Austin, the University of Texas Rio Grande Valley, the University of the Incarnate Word, Texas Christian University and the University of North Texas Health Sciences Center School of Medicine, Sam Houston State University and the University of Houston have opened new medical schools or schools of osteopathic medicine.
The number of satellite campuses has also expanded, not just NYU Abu Dhabi or Shanghai or Yale in Singapore, but those created by Carnegie Mellon (in Silicon Valley), Cornell (in New York City), Northeast (in Charlotte, San Francisco, Seattle, and Toronto) or the University of Massachusetts at Amherst (at Brookline). At the regional level, the University of Houston set up campuses in nearby suburbs of Katy and Pearland and an energy research park at Schlumberger’s former global headquarters.
What makes an institution expand beyond its core competencies? Is it empire building or fire development? The desperate pursuit of new revenue? Is it an attempt to diversify, consolidate political support or promote local, regional or state economic development?
The correct answer, of course, is all of the above.
Institutions have adopted a much more entrepreneurial mindset. The most successful leaders are risk takers, visionaries and builders who seize opportunities, create partnerships and successfully promote an ambitious growth agenda among donors, trustees, civic leaders, foundations and other constituencies.
They are first-movers, disruptors and masters of public relations, with an eerie ability to transform their institution to match their vision. But for every Joseph E. Aoun, Michael Crow, Renu Khator, Paul LeBlanc or Michael Sorrell, other presidents overthrow, and like Daedalus, they go down and burn and damage their institution in the process.
As a faculty member, I want our institutions to invest more in our core business, undergraduate education, and scholarships conducted for its own sake.
But as an off-on-on administrator, I also recognize that in order for colleges and universities to survive in something like their current form, leaders at all levels need to identify new sources of revenue, control costs, build public support, and promote their institution’s brand.
There is a reason why truly successful senior executives are well paid: They run operations that are even more complicated than most companies. Even small colleges have their own athletics and entertainment complex, development and writing of surgeries, health services, libraries, museums, physical facilities, police force and technology infrastructure. And the policy and level of stakeholder engagement is far more filled with even the largest companies.
The ability of institutions to survive the current crises and flourish in the future depends on the ability of senior management and the Faculty of Entrepreneurship to generate the ever-increasing amounts needed to fund their university’s academic and non-academic businesses. Auxiliary services, grants and contracts, patents and licenses, new markets – all are part of the equation.
We like to fantasize that the firewood tower is somehow free from pollution from the economic and political sphere. But our success is inextricably intertwined with these spheres, and we must embrace maturity to recognize that no miracle is likely to save our institutions. It’s up to us.
Steven Mintz is a professor of history at the University of Texas at Austin