I was always concerned about how do universities spend their money. Doing a research I found out that only between 27%-33% of the money from public and private universities respectively goes to instruction. This means that basically 1/4 of the expenditures goes to teachers.
I made an interview with the VP of Finance of my college and realized that some of the numbers matched with what I found. The second biggest percentage of expenditure from universities is Institutional Support, this means the general administration and management. Doing research I found that around 14% of the budget goes to administration costs. If there is a university that only teaches online will this % reduce significantly? Surprisingly a 11% of private universities goes to research, this means funding to research institutes, laboratories and individual research. Adding up the last two percentages just mentioned it is pretty close to the percentage that goes to teachers and instructors. If we add 33%, 14% and 11% this adds up to 58% this is a HUGE expenditure impact for universities. Are there any ways to reduce this percentages in order to reduce the costs?
The information provided from Public Universities changes from Private universities. A 27% goes to Instruction purposes, such as professors and instructors. A 12% goes to research and surprisingly a 11% goes to Hospital Services. This surprised me since a large % of the expenditures from universities goes to expenses at a university affiliated hospital. For this big % does the university has an obligation for this expense? Is there a way the government could help reduce this %?
I think we really need to understand the expenditures of the universities since it is a crucial way in order to reduce their costs, and as a consequence impact the student's cost.