Media Contact:
Noah Black
noah.black@apscu.org


Spending on Instruction: Bang for the Student Buck? 


If we asked you who spends more money on teaching students, the five largest private sector schools or the University of Texas system, which would you pick?  The answer might surprise you: private sector institutions. As a proportion of revenue, these institutions outspent the University of Texas by over 10 percentage points.

 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.

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.


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