Students graduating with crippling student loans may have reason to point a finger at the heads of the universities they graduated from, a recent study suggests.
“The One Percent at State U,” conducted in May by the Institute for Policy Studies, looked at the correlation between top administrators’ salaries at large public universities with rising student debt and an increased dependence on low-wage part-time faculty labor.
The study found that at the universities with the highest-paid presidents, student debt burdens and low-wage faculty labor are noticeably higher than the national average.
“In the public debate, these issues are often treated separately,” the report said. “Our findings suggest these issues are closely related and should be addressed together in the future.”
The study looked at how these numbers changed during and after the 2008 financial crisis and its findings, which have garnered national attention, show an imbalance in financial priorities.
“A top-heavy, ‘1 percent recovery’ occurred at major state universities across the country, largely at the expense of faculty and students,” the report said.
The top four “most unequal public universities,” according to the study’s metrics, were all Big Ten universities: the Ohio State University, Penn State University, University of Michigan and University of Minnesota.
This university was not among the institutions with the 25 highest-paid presidents the study looked at, but similar trends exist here.
University President Wallace Loh’s 2014 salary was $496,409, up from his starting salary of $450,000 in 2010, according to Diamondback salary guides. He is currently the 10th-highest paid president among the 14 Big Ten universities, and 89th among all 255 public universities nationwide, according to the Chronicle of Higher Education, which published the statistics the study used.
While the university is in the middle of the pack among peer institutions, the amount the state pays our highest administrator has risen substantially in recent years.
When Loh’s predecessor, Dan Mote, was hired in 1998, his starting salary was $250,000, about half of Loh’s current salary. Even when adjusted for inflation, Loh was still paid about $100,000 more than his predecessor.
In his first two years, Mote’s salary increased by $8,000, a fraction of the $46,000 increase Loh has seen since 2012.
This university’s human resources director, Dale Anderson, said this increase is a response to a rise in the market value of university presidents.
“It’s a competitive environment,” he said. “Obviously when you have an opportunity to hire, you want the best possible president that you can get to lead the institution forward. It’s a competitive market and you have to pay market wages to get the folks that you want to attract, that’s just what the open market is.”
The University System of Maryland’s Board of Regents determines how much a president should be paid each year based on performance and salaries of comparable administrators.
“The board has always [striven] to find a balance between salaries that are responsible on the one hand and competitive with what presidents around the countries are making for large complex major research universities,” said Mike Lurie, USM spokesman. “It’s definitely a balancing act.”
The salaries for the highest paid university employees and football and basketball coaches have also risen dramatically in the past decade.
Head Football Coach Randy Edsall was hired in 2012 with a $400,000 base salary, according to The Diamondback salary guide. However, this represents only a portion of the full $2 million he makes per year when compensation for public appearances and other bonuses are added in, making him the 9th highest paid coach out of the 14 Big Ten universities, according to USA Today’s rankings.
The starting base salary for previous head coach Ralph Friedgen was less than half of Edsall’s when he was hired in 2001 for about $180,000 per year, according to salary guides. This dramatic salary increase also exists in basketball. Mark Turgeon was hired in 2011 with a $400,000 base salary, but now makes $463,314. In 2003, the year after Gary Williams won a national championship with the Terps, the university paid him $207,584, according to salary guides.
Zack Bolno, senior associate athletics director for media relations, said all coaches’ salaries are funded through athletic department revenue, and the department gives them many bonuses in addition to their base salary.
“The performance of each bonus would include achievement on the field and in the classroom,” he said. “Other incentives include appearances such as coaches radio shows and public speaking engagements.”
While the salary of top administrators and head coaches have increased, so too have student debt burdens for graduating seniors.
According to the Project on Student Debt, the average student debt for graduates from this university in 2012 was $25,276, the 9th highest of the 14 Big Ten universities, and just below the national average for public institutions.
This number reveals a 26 percent increase from 2008, when average student debt was $20,091. The percent of students graduating with debt increased from 44 percent in 2008 to 46 percent in 2012, a modest increase that still leaves the university well below the public college average of 66 percent, according to the Project on Student Debt.
The area where the university is near the bottom is the percentage of debt that is taken out from private lenders. According to the Project on Student Debt, 28 percent of university graduates’ debt is with private lending companies, the second-highest figure in the Big Ten. Private loans don’t offer the same protections and repayment programs as federal loans.
“Private student loans are quite different,” said Matt Reed, program director for the Institute of College Access and Success, which ran the Project on Student Debt. “They typically have variable interest rates that go up and down with the market over time, they do not have income driven repayment plans or consumer protections, its not just the amount of debt but the type of debt as well.”
The Board of Regents addressed the growing concern of student debt at its June 3 meeting. The Education Policy and Student Life committee presented a series of recommendations aimed to help ease the burden of student loans.
The committee set two primary goals for the USM institutions to strive for: that average student debt should be less than one year of the full-time cost of attendance for in-state students, which is currently $24,352; and “that Maryland residents should have less debt than the overall institutional average,” according to the summary.
MaryPIRG Sustainable U Campaign coordinator Rob Swam said student debt is a serious burden for recent graduates.
“It means once they graduate and get a job, it’s gonna be harder and harder to have money to spend on themselves,” he said. “It’s a big issue.”
MaryPIRG, a non-profit student-run organization that works to keep education affordable, has worked to keep the student-loan rate down and move to low-cost open-source textbooks. Swann said the best thing students can do to make college more affordable is to work together.
“Coming together and showing support, petitioning is a really powerful tool,” he said. “People united are a lot more powerful than people separated.”
Undergraduate Senate Executive Committee representative Ryan Belcher said student debt represents a larger societal issue.
“The fact that students are graduating with debt is unacceptable,” Belcher said. “Society is saying that college education is becoming a necessity now rather than a luxury.”
The other part of the “One percent at State U” study focused on the trend of low wage, part-time faculty replacing full-time, tenured faculty in the classroom.
At this university, the percentage of credits delivered by tenured faculty has dropped from 55 percent in 1997 to 41 percent in 2012, while non-tenure-track faculty credits have risen from 30 percent to 46 percent in the same time span, according to last year’s report by the Non-Tenure Track Faculty Task Force.
Mark Arnold, director of faculty initiatives, said these numbers do not tell the whole story. He said the number of total courses has greatly increased, and adjuncts have been hired to fill the new spots, rather than replace full-time faculty.
“The number of tenure track faculty is not falling,” he said. “It’s not that they’re being replaced by adjuncts, it’s just that we’ve got more course offerings, many of which tenure track faculty aren’t able to teach because of financial policies.”
