They have to orchestrate thousands of employees, fundraise to compensate for billion-dollar budgets and represent their institutions, but many university presidents are being paid hundreds of thousands of dollars or more to run their schools, which have become more like corporations than the non-profit educational outlets they once were, according to several education professionals.
Being a university president has become more complicated over the years. And with fewer qualified people in the university president market, salaries have become more competitive, these experts say.
Results of an annual salary survey published this month in The Chronicle of Higher Education found that more university presidents are being paid higher salaries than in previous years.
The Daily Free Press reported last week that the more-than-1-million-dollar salaries of several university presidents include not only their yearly salaries but benefits accumulated over the years as well. School of Management professor Fred Foulkes, also the director of the Human Resource Policy Institute and an expert in management education, said the increasing salaries for university presidents is justified because running a university has become similar to running a corporation.
“Look at the size of [universities],” he said. “They have thousands of employees and thousands of students and billion-dollar budgets. They’re pretty large, complex institutions.”
But it is the emergence of universities as corporations that bothers many educational professionals, including John Curtis, director of research at the American Association of University Professors in Washington, D.C.
“The concern we have is that the increasing salaries of university presidents represents a more corporate organization,” he said. “[University presidents] are acting more like CEOs than leaders of a non-profit educational institution.”
Compared to the salaries of university professors, the salaries of university presidents have risen faster over the past 10 years, according to Curtis.
“It seems to be a spiral effect,” he said.
Curtis suggested reversing the trend of rising salaries of university presidents by looking back at the basis of education.
“Higher education is for the benefit of the whole society and not just for individuals,” he said.
Even though many university presidents are paid hundreds of thousands of dollars for the jobs they do, they could be living even more financially comfortable lives by holding jobs in the private sector, according to Paul Fain’s article in The Chronicle of Higher Education. They are choosing to work in education when they could be making millions more in the private sector, Fain said.
The increase in salary seems to correlate with the changing role of university presidents as well as the alleged lack of qualified candidates.
“It’s a more competitive market, and these are harder jobs,” Fain said. “They have to be a jack of all trades. They handle fundraising, deal with legislators, professors, students.”
Foulkes agreed that university presidents are being paid more because of competition in the field.
“It’s the old market theory of supply and demand,” he said. “These are difficult jobs. You’re going to pay a certain amount of money to get people to do these jobs.”
Competition among the boards of trustees at different schools to get the best candidate is also a factor in the increasing salaries of presidents, Foulkes said.
“Each board of trustees looks at people running large industries and compares them, and they want to make sure their person is competitive,” he said. “It’s not realistic, but everyone wants to be in the 75th percentile.”
And with the realization that every presidential candidate is not equal, boards of trustees are continuing to compete for the best of the best with higher and higher salaries.
“You’ve also got to ask, ‘are trustees getting the kind of performance you would hope would happen with pay being what it is?'” Foulkes said.
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