We examined the amounts that various schools spent on instruction, student services, and academic support in 2013. After comparing the five largest US based private sector institutions to Vanderbilt, the University of Texas System, the University of California System, and American University, we found that the private sector institutions either outpaced these universities or were very competitive in terms of spending on instruction, services, and support as a percent of revenue.
Over 45 percent of the combined revenue of the five largest private sector institutions went to instruction and student services. The private sector institutions on average spent over 25 percentage points more than Vanderbilt in the 2013 fiscal year. Their closest peer was American University who spent 46.4 percent compared to the private sector's 45.4 percent – a difference of only 1.0 percent.
Critics of private sector institutions too often claim that our institutions are not prioritizing instruction. As this data points out, this is simply not true. It may be time for these critics to direct their attention to old guard institutions, because a student entering Vanderbilt in the fall (and taxpayers subsidizing their education) will be getting much less bang for their buck than one attending a private sector institution.
PSCUs open doors to many of the 9.1 million unemployed and 90 million undereducated Americans by providing a skills-based education. To remain competitive over the next decade, we must identify between 8 and 23 million new workers with postsecondary skills. PSCUs are a necessary part of that solution, having produced over 800,000 degrees last year alone.