Statement by Michael A. Boulus, Executive Director, Presidents Council, State Universities of Michigan, March 28, 2011
The Detroit Free Press article of March 27, “Amid tougher times, spending on payroll soars at Michigan universities” was wide of the mark in a number of ways. It also missed an extraordinary opportunity to give insight into the real value of Michigan’s universities to our state’s economy.
The two most important misses: First, its failure to point out that the overriding reason for recent tuition increases is deep and dramatic cuts in state support --to the point where Michigan’s taxpayer support is among the lowest in the nation—and not the growth of university payroll.
Second, its failure to acknowledge that universities are adding capable administrators to oversee a growing demand by business leaders and government officials that they be more than diploma mills.
Let’s address the second issue first. Yes, Michigan universities are adding administrators. Michigan’s universities have seen huge increases in private and federal research funding in recent years. For instance, research funding from outside sources increased by 100 percent at Michigan Technological University, one of those the paper cites as having significant growth in administrative staff.
At the just the University of Michigan, Michigan State University and Wayne State University (the University Research Corridor institutions), research and development expenditures funded from outside of the universities increased by $263 million in the past five years.
That research is keeping Michigan industries on the cutting edge of new technologies from automobile to defense, from stem cells to rare isotope research.
That money comes from outside the state, and represents a huge value to our economy. But additional research dollars require additional personnel to meet those research needs, and to ensure funding organizations that the money is spent appropriately.
Universities also have been forced in recent years to become the state’s scholarship program for needy students. Virtually no state scholarship funds for public university students are available today from state sources. Universities have had to add staff to manage scholarships, helping ensure that lower income students have access to higher education.
Universities are rightly under pressure to increase graduation and graduate placement rates. Most of our schools are leaders in this category among their peers. But adding counselors and placement officials means adding administrators.
So, yes, administrators have been added. But no, they are not overpaid. Buried in the article is the fact that compensation increased by 9 percent over the five-year period. That’s total compensation, including health care costs, at less than 2.5 percent a year. To get the best and brightest, as our corporate executives remind us, you need to keep up with market rates.
Policymakers – and newspapers -- who want state universities to turn down research dollars, stop taking action to make sure college is an opportunity for all, regardless of income, and see graduation rates drop, should continue agitating and providing misleading and incomplete information to the public. Universities, however, intend to continue taking a leadership role in all those areas.
More troubling, the article completely ignored the dramatic cut in state support for Michigan’s college students this decade – missing a chance to tell readers the real reason tuition has had to increase more than university governing boards would have liked.
Michigan’s political leaders have ignored the fact that the only path to prosperity today goes through college. Of the top 16 states in per capita income, 14 are also in the top 16 of college attainment, the percent of population with a four year degree. The other two are oil states.
Michigan’s dramatic loss of per capita income this decade came as we aligned with that trend. Michigan is 37th in per capita income and 34th in college attainment. We will not be prosperous until we have more college graduates in Michigan.
Gov. Snyder has proposed a 22 percent cut in state support for higher education. That comes on top of a 14 percent cut over the past eight years. If the governor's budget is accepted, state support for higher education will have been cut by more than $500 million in the past nine years – before considering inflation.
State support per student in 2010 was $4,822. The national average in 2010 was $6,454. Under Gov. Snyder's proposal, state support will drop to $4,098 (assuming no increase in enrollment), third lowest in the nation.
Tuition increases – and research and development funding -- have helped offset some of those losses. Universities are doing more with less. In 2000, 34,551 bachelor's degrees were conferred by Michigan public universities. In 2009, 41,171 bachelor's degrees were conferred.
Michigan’s universities are among America’s best. Yet state government’s support for them is approaching the lowest in the nation. That cannot continue. Politicians and bureaucrats trying to micromanage universities from Lansing, as some seem to want, cannot change that fact.