If you’ve ever wondered why going to a public university is so expensive, maybe it’s due to the expenses paid by the Universities. Chief among them is the amount of money paid to the administration and faculty.
For example, Charles Robinson, the recently appointed interim chancellor at the University of Arkansas has been awarded a salary of $480,000. To give some perspective, Robinson is making 20% more than the President of the United States!
Okay, okay, but are the actual professors overpaid?
According to the most recent survey from the American Association of University Professors (AAUP), full professors in most of the country have annual salaries far exceeding $100,000 per year.
Of course many faculty members at public universities make less than six figures, especially those who are not tenured or are hired to teach on a per class basis.
Much more important (and expensive) are the faculty benefit packages. The value of the retirement benefit varies and is typically based on a multiplier of years worked times a percentage of the most recent salary.
While these benefits may appear rich, and compared to most workers in the private sector they are, don’t expect them to last forever. Even now states are cutting back on retirement funding for new hires and private institutions are grappling with the reality of large budget deficits.
“Facing devastating financial losses related to the coronavirus pandemic, colleges and universities are cutting costs just about everywhere they can. Increasingly, that includes faculty and staff retirement benefits.
Duke, Georgetown, Northwestern and Texas Christian Universities are some of the institutions to announce cuts to retirement contributions in recent days. Some of these decisions have been more severe and more controversial than others.”
What’s the point?
Well, since you as the consumer are likely paying for some portion of your education, it’s nice to know where your money is going. With above average salaries, and very generous retirement benefits, you may also be interested in pursuing a career in higher education.