"Higher education is a public good currently lacking public support. There is no stronger
trigger for rising costs at public universities and colleges than declining state support."
According to the Washington Post, "President Barack Obama will announce a plan to shift some
federal dollars away from colleges and universities that don’t control tuition costs and new competitions
in higher education to encourage efficiency as part of an effort to contain soaring college costs. Obama
will spell out his plans Friday at the University of Michigan in Ann Arbor."
One issue that will probably not receive a lot of attention today from either President Obama or President
Coleman is the contribution of rising administrative positions and salaries to the rising cost of college
tuition. For example:
1. According to data from the Chronicle of Higher Education, the University of Michigan-Ann Arbor has 53%
more full-time "administrators and professionals" (9,652) than full-time faculty (6,305), or a ratio of 1.53
administrators for every full-time faculty member. Couldn't those administrative expenses have something
to do with rising tuition?
"Michigan public universities increased their spending on administrative positions by nearly 30% on average
in the last five years, even as university leaders say they've slashed expenses to keep college affordable for
families. The number of administrative jobs grew 19% over that period at the state's public universities,
according to data submitted by the schools to the state budget office.
The increases took place from the 2005-06 school year through 2009-10 -- a period in which both student
enrollment and state funding of universities remained about the same, state data show. The higher administrative
costs were slightly exceeded by tuition hikes over this period."
3. From this Detroit Free Press database that accompanied the article above, administrative salaries at the
University of Michigan-Ann Arbor increased by almost 27% in the five-year period between 2005-2006 and
2009-2010, compared to an 18.2% increase in faculty pay during the same period.
4. From a related March 13, 2011 story in the Flint Journal:
"The University of Michigan-Flint’s administrative ranks has grown the fastest among the 15 public
universities in the state, according to figures from the Michigan Higher Education Institutional Data
Inventory released earlier this year. The data showed that the percentage growth in full time administrative
and professional staff positions swelled 74 percent between 2005 and 2009, although the percent of
administrative positions on campus remains average compared to other universities.
As the number of deans, associate deans and program directors grew at the Flint campus over the last five
years, so have administrative paychecks. Six-figure salaries more than doubled on campus since 2006,
according to the newest faculty and staff salary information recently released by UM. Nearly 50 of the
roughly 1,000 employees made $100,000 or more at UM-Flint, compared to about 20 four years earlier."
5. It's not just Michigan universities that have added administrators, it's a national phenomenon, here's a
story from a few years ago about the growth in administrative positions in the University of North Carolina system.
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CME Group has announced a record in daily trading volume for its benchmark Henry Hub Natural Gas futures contract. These contracts are listed by and subject to the rules of NYMEX.
Henry Hub Natural Gas trading volumes surged yesterday to 824,316 contracts, a 48 percent increase over the previous record of 557,179 set on January 17, 2012, and a 170 percent increase over the average daily volume of 305,017 contracts in 2011.
"Our Henry Hub futures contract is the leading benchmark for the North American natural gas market, which accounts for almost a quarter of energy in the U.S.," said Gary Morsches, Managing Director, Global Energy at CME Group. "It's the second most-actively traded futures contract in the world based on a physical commodity and is a key part of our global suite of energy products, which traded an average of 1.8 million contracts a day in 2011.
Henry Hub Natural Gas futures have set a total of 11 new open interest records since the start of 2012, including a Jan. 19 record of 1,162,553 contracts.
