How do we assess the efficiency of our universities, individually and collectively, other than by analyzing the data they release through organizations they created long ago with the specific objective of data collection and sharing? (See DATA SOURCES)
Throughout this site the text and tables are focused on multi-university averages – the Top 25* with 2001 as the base year, and the Top 50* since 2020 (* based on GO expenditure).
Most of these averages reveal significant declines in efficiency but all averages are the product of above-average and below-average performers. For this extensive analysis to have value, beyond revealing deep inefficiencies that are mostly national in scope, it must incorporate university-specific insight; while these issues exist to some degree at every university, the reality is that some are more efficient than others.
For their own wellbeing, each university needs to stand the test of comparison – not just with its peers but also, given the long-term nature of the efficiency declines, with its own past.
There may be occasional differences in how universities report their data, but the comprehensive definitions in the CAUBO Guidelines should ensure that they are not significant enough to undermine the comparisons.
There are no such issues when it comes to historical comparisons, because a university doesn’t suddenly change the way in which it has long reported its numbers.
Rankings are provided for the eight expenditure-based areas in the Topics menu. While each university is unique, they all exist to do similar things, adopt similar approaches, and must deal with similar change and challenge. In the final analysis, this isn’t just about focusing on those that seem to be performing poorly, but also those that seem to be performing well; they demonstrate that higher standards are attainable – even if they are underperforming compared with their historical numbers.
The Efficiency Rankings rank Canada’s Top 50 universities based on their current performance in each Topic area. The methodology is described below:
Efficiency Rankings Methodology
Efficiency Rankings for the latest year are provided for each Topic. Performance is measured from four different angles, which could involve:
- A percentage share of a total (e.g., % of General Operating expenditure, or % of total staff costs)
- A relationship with another factor (e.g., Instruction expenditure per dollar of Tuition Fee income, or Administrative Salaries per dollar of Academic Salaries)
- A $ value per FTE (full-time equivalent) student; this angle is particularly insightful because it is a “real dollar” measure – adjusted for both inflation and changes in enrollment.
The use of four different angles of measurement enhances the likely validity of the Ranking by reducing the influence of a circumstantial advantage (such as a high Per FTE value resulting from an above average level of international student enrollment). All the values that form the bases of these measures are inflation-adjusted.
The Ranking for each Topic is a combination of the rankings from the four measurement angles.
All Efficiency Rankings favour Instruction and students; performance that could detract from those interests is ranked accordingly.
Key Efficiency Indicators and Relative Cost Impact Methodology
In each Topic, one of the four measurement angles used in the Ranking is selected as the Key Efficiency Indicator – the measure likely to provide the most accurate reading of efficiency.
While the data forming the basis for the Rankings is insightful when it comes to assessing efficiency and longer term change, it ends up with somewhat abstract measurements like percentages and ratios.
However, the same data also affords us the opportunity to measure the actual dollar cost of change over time – the “Relative Cost Impact” (RCI) in current-year dollars. The Administrative Cost topic provides an example of calculating the RCI:
- In 2010, the average Top 25 university spent $122.0 million on Administrative Salaries & Wages and $238.8 million on Academic Salaries.
- This level of Administrative expenditure amounted to $0.51 for every dollar spent on Academic Salaries ($122 million divided by $238 million). This is the Key Efficiency Indicator (KEI).
- In 2024, the average Top 25 university university spent $174.8 million on Administrative Salaries & Wages and $292.8 million on Academic Salaries.
- This increased the KEI to $0.60 per dollar of Academic Salaries ($174.8 million divided by $292.8 million).
- If it had remained at the same level as 2010, Administrative Salaries & Wages would have been $149.3 million ($292.8 million x $0.51).
- The Relative Cost Impact – in this example, a relative cost increase or over-expenditure – was therefore $25.5 million ($174.8 million less $149.3 million).
- The RCI is a negative value – a relative cost reduction or under-expenditure – when the KEI number falls.
The same mechanics work when comparing two universities, or when comparing a university to its peer group average.
The RCI numbers provide important dollar insight into the cost of inefficiency, and the impact it exerts on Core Mission areas. .
While this site only addresses bigger picture components, the same approach can be taken for every budget line, all the way down to items like travel and stationery. Carrying out that exercise on an annual basis at the campus level is a prerequisite for monitoring efficiency, identifying and rectifying issues, and improving the budgeting process.