- Other Salaries & Wages in Instruction – $96 million (Up 97% since 2001, Up 37% since 2010)
- Other Salaries & Wages in Central Administration – $78 million (Up 175% since 2001, Up 52% since 2010)
- Other Salaries & Wages in Instruction AND Central Administration – $175 million (Up 126% since 2001, Up 43% since 2010)
- Total Academic Salaries in Instruction – $293 million (Up 81% since 2001, Up 23% since 2010)
- Total General Operating Expenditure – $929.4 million (Up 81.6% since 2001*)
- Enrollment – 35,034 (Up 58.7% since 2001)
Administrative cost is the most fundamental determinant of a university’s efficiency. The cost of non-academic staff is the second-largest expense at every university, just behind the cost of academic staff and far ahead of everything else. It has easily the greatest capacity for deflecting funds away from teaching, and triggering the need for needless student fee increases and cuts impacting the classroom. That explains why this is the most-visited page on the site.
The numbers on the preceding pages indicate that non-academic functions have received significantly larger budget increases than academic functions since 2001.
While the cost of Central Administration (see Operational Support) provides one guide to administrative cost, it doesn’t portray the full picture because some schools take a more de-central approach to administration. Central Admin also includes some significant costs that are unrelated to administration.
Administrative support is vital to the overall operation of the institution, and it’s provided by staff who fit into CAUBO’s “Other Salaries & Wages” category. They include “All full and part time non-instructional staff”, including clerical & secretarial, professional & managerial, and “payments to individuals who may hold an academic rank, or equivalent thereto, but are engaged in activities other than instruction and research”, such as the president, and vice-presidents.
The cost of providing administrative support to the Academic Mission is incurred in two places – Central Administration AND the faculties and departments within Instruction. (The other GO functions – the Library, Student Services, Computing & General, and Physical Plant – are largely self-contained entities that receive high-level supervision, rather than significant administrative support, from Central Admin.)
The chart below shows the change across the Top 25 since 2001 in “Real PSE Dollars” (adjusted for both inflation and enrollment). Positive values denote increases exceeding inflation and increased enrollment combined:
6 A) Changes in Real Salaries & Wages Expenditure Per FTE Student – By Type (Top 25)
1 A) 2024Download this table (Opens in new tab)
Those numbers demonstrate the inescapable reality that, frustratingly, has been ignored by key decision-makers for more than two decades: the more they spend on running a university, the less can be spent on actually being a university.
We can better assess the increase in administrative cost by taking the expenditure on Other Salaries & Wages in both Central Admin AND Instruction, and then evaluating it in relation to expenditure on Academic staff in Instruction. This provides a clearer picture of the total cost of “administration” – regardless of whether the school takes a more central or de-central approach.
The insightful measure is not so much the cost of non-academic staff, but the relationship between that cost and expenditure on academic staff.
The following tables provides that insight.
6 A.1) Administrative Salaries & Wages Per Dollar of Faculty Salaries – Since 2010 (Top 25)
1 A) 2024Download this table (Opens in new tab)
Across the Top 25, the cost of administrative support has risen from 51.1 cents per dollar of faculty salaries in 2010 to 59.7 cents in 2024. That is indicative of the degree to which the administrative component has been permitted to progressively overpower the academic component since 2010, although that has been happening since at least 2001.
(To be completely clear, because some administrators have incorrectly asserted otherwise in their quest to counter criticism of rising administration costs, those numbers do not include the cost of Student Services staff. They are accounted for in a standalone function, and addressed separately on this site. The above ratio only measures administrative support provided to the academic program, whether centrally or de-centrally.)
We can assess the dollar impact of that progression (see methodology HERE), and those numbers are shown in the following table:
6 A.2) Real Relative Cost Impact vs 2010 Level – in Thousands (Top 25)
1 A) 2024Download this table (Opens in new tab)
The direct impact of that cost escalation was a stunning $25.1 million at the average Top 25 university in 2024 alone, and that number is increasing every year.
As that additional expenditure can only be funded by a combination of increased student fees and reduced allocations to the classroom, we can add a more human dimension by expressing it as a cost per student:
6 A.3) Real Additional Administrative Cost Per FTE Student vs 2010 Level (Top 25)
1 A) 2024Download this table (Opens in new tab)
In 2024 the cost of the additional administrative expense (not the entire cost of administration, just the relative increase versus the 2010 spending level) amounted to $718 per FTE student.
But, as the graph line shows, this is an accelerating annual cost that has now exceeded $700. If it remained at the current level, and all of it was funded by student fees, it would amount to almost $3,000 of additional fees for four years of study – and, for many students, almost $3,000 of graduation debt that will take years to repay.
The 2024 Top 50 Efficiency Rankings – Table 6 B) below – show that this disturbing pattern is widespread. TWENTY of those 50 universities are now spending more than SIXTY cents on non-academic salaries & wages for every dollar they spend on academic salaries.
It has been noted that some universities opt for a more centralized approach, under which a higher proportion of the administrative support is performed in Central Administration, while others opt to do less centrally and more within the individual faculties and academic units.
The existence of varying degrees of administrative centralization begs the question “Which approach is best?”
That angle is explored in Table 6 B.1) below. It ranks the universities based on their expenditure on Other Salaries & Wages Per Dollar of Faculty Salaries, but it also includes a measure of the “centralized vs decentralized” factor – the share of the total administrative cost incurred in Central Administration.
The Table shows that most of the universities which take a more centralized approach appear to be better performers when it comes to total administrative cost per dollar of faculty salaries and wages. However, that’s not a definitive indication that a more centralized approach is more cost-effective – or an indication that implementing a higher degree of centralization is a panacea for rectifying excessive administrative cost. Notwithstanding all the complexities, these numbers make it clear that administrative cost is a major issue, regardless of where it is incurred.
This is a topic that directly impacts student cost and educational quality – what could be more important? And yet the “jury” is still out on whether a more central or more de-central approach is the most cost-effective. It really shouldn’t be. CAUBO has existed for almost a century, with a central mission of sharing information and “best practices”, so this critical question should have been answered long ago.
SOME CLOSING THOUGHTS ON ADMINISTRATIVE COST
The major growth in administrative cost and its consequences are exasperating. The actual numbers support the frustration long voiced by Faculty, but usually only backed with anecdotes about increasing head counts in Central Admin.
However, it’s important to add some tempering notes.
Some of the additional cost is attributable to valuable additions to the scope of administrative endeavour in important areas such as occupational health & safety, environmental awareness and responsibility, campus security, and making the university more accessible and welcoming to indigenous students. Campus is a better and safer place for these initiatives.
During the early-2000’s a new imperative started to assume greater importance within PSE – “status”, and its close partner “image”. Much of the impetus for this came from the emergence of global university rankings, but many universities also started to ratchet-up their competition with eachother for domestic (Canadian) students. Most now spend considerable sums promoting, protecting and buffing their image, but – as important as some of these endeavours may be – it’s a reality that money spent on style is money that can’t be spent on substance.
Further additional cost is imposed on the universities by outside parties, especially federal and provincial governments, requiring them to meet ongoing reporting duties. Some of this reporting is important, but much of it is likely to be bureaucratic “red tape” exercises that have built over the years and incur significant cost for little real benefit to the university – or, sometimes, even the party requiring the reporting.
And then there’s the unknown cost, especially since 2010, attributable to the intensifying quest – and competition – to attract more international students.
But those tempering notes only cover some of the additional cost, certainly not all of it.
Most of the factors outlined above were advanced back in 2010 as explanations for the major escalation in administrative cost levels; it was a burning issue even then – after a decade in which increasing computerization brought some substantial cost savings. But those savings were sucked into the vortex of increasing administrative expense, and the issue just keeps deepening, year after year; that graph line is still climbing.
That $25.2 million escalation in the relative cost of administrative support equates to an additional 200 employees earning $125,000, doing things that didn’t need to be done in 2010. In that year, 2010, senior administrators were using the same explanations to account for the cost of a lot of new staff doing things that didn’t need to be done in 2001.
If the factors that senior administrators cite really were the main causes of the increase in administrative cost, most universities would be impacted to a similar degree, but they are not. As the Rankings show, administrative costs are far higher at some universities than at others. Moreover, there are some marked differences between universities within the same province, which undermines the explanation that provincial reporting requirements are a major cost driver.
There are certainly some mitigating factors for the dramatic escalation of administrative cost, but there is nowhere near enough mitigation to justify the extent. and the adverse impact it exerts – year after year – on student fees and the Core Mission academic program. Some way back, those factors ceased to be an explanation and became a well-rehearsed script aimed at explaining-away the inexcusable.
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This Topic crystalizes an issue that has been undermining Canadian PSE for more than 25 years – causing needless increases in student costs and declines in funding for the academic program. The universities’ own numbers provide statistical validation to the frustrations long expressed by students and faculty, elevating them from “grumbles of self-interest” to valid concerns supported with real numbers.
Efficiency Ranking
The underlying methodology for the Efficiency Ranking tables can be seen HERE.
6 B) ADMINISTRATIVE COSTS: 2024 EFFICIENCY RANKINGS (TOP 50)
6 C) 2024Download this table (Opens in new tab)
While the above Rankings table is based on the four-element approach taken for other rankings tables, the following table has another purpose – to assess the relationship between Administration Cost per Dollar of Faculty Salaries AND the degree of centralization in providing those services.
Key Efficiency Indicator and Relative Cost Impact
The underlying methodology for the Key Efficiency Indicator and Relative Cost Impact calculation can be seen HERE.
These measures are provided for the Top 50, with 2020 as the base year, and for the Top 25, with 2010 as the base year. The Top 25 table shows the major dollar consequences of the efficiency decline in that timeframe.
6 C) KEY EFFICIENCY INDICATOR AND RCI: 2024 vs 2020 – and – vs LATEST GROUP AVERAGE (TOP 50) – Opens in new tab
6 D) KEY EFFICIENCY INDICATOR AND RCI: 2024 vs 2010 – and – vs LATEST GROUP AVERAGE (TOP 25) – Opens in new tab