New Research: Shared Governance Promotes Cost-Effectiveness

November 1, 2012 | Blog

Good news for UW-Madison faculty, staff, and students:  a new study suggests that shared governance lowers institutional costs per student.  The disintegration of shared governance across the nation’s universities has contributed substantially to rising costs, according to these economists.  But not at UW-Madison, right folks? We are keeping shared governance alive.

There is more good news.  The study also says that the optimal ratio for cost containment is 3 tenure-track faculty for every 1 full-time administrator.  At many places there are now twice as many administrators as faculty.  But not at Madison. This year, Madison has 1,986 tenure-track FTE faculty compared 406 FTE administrators, a ratio of 4.86 to 1.

However there may be some need for closer attention to what lies ahead.  The study also suggests that we need to take into account students (imagine that!) and think about our staffing relative to students, not merely one another. And there, the evidence suggests potential problems.  Between 1987-2008, the study reports that nationally at public research universities the number of administrators per 100 students increased 9%, while at Madison the data digests show that growth was 34% — with another 5% growth occurring since 2008.  In comparison, nationally the number of tenure-track faculty per 100 students grew by 3%, while at Madison it declined by 3%, then rebounded for a total net gain of 2% in the last five years. Admittedly, Madison started with a higher baseline for faculty– almost 0.5 more tenure-track professors per 100 students than the national average– and a lower baseline for administrators–about 0.6 fewer administrators per 100 students than the national average.  But even so, this change over time is not necessarily about striking a better balance, and  given the trends we in shared governance need to ensure that’s the sole motivation.

Punchline? At the moment, we seem to be in a good spot.  This study contradicts the “popular hypothesis [that] intransigent tenure track faculty prevent costs from being minimized by cost conscious administrators.”  The shared governance metric (the ratio of tenure track faculty to full time professional administrators)  is not correlated with cost. Instead, “costs are convex in the ratio of tenure track faculty to full time administrators and the models suggest costs are lowest when the ratio is approximately three tenure track faculty for every one administrator.”

The problem is that “the ratio goes higher or lower costs per student are higher.” If anything, this study suggests that we may have too many faculty at Madison given the numbers of students we are serving– a great case for increasing enrollment, and maybe, growing the size of the administration a bit too (whew, never thought I’d say that).

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