Tuesday, January 28, 2014

Congress Notices the Loss of Tenure

The US Congress has released an important study on the use and abuse of contingent faculty at American institutions of higher education. Although many people inside and outside of higher ed are starting to know something about this issue, this report places the loss of tenure and the use of part-time faculty on the national political agenda. 

The introduction to the report locates the growth of non-tenure-track faculty within a historical perspective: “The post-secondary academic workforce has undergone a remarkable change over the last several decades. The tenure-track college professor with a stable salary, firmly grounded in the middle or upper-middle class, is becoming rare. Taking her place is the contingent faculty: non-tenure-track teachers, such as part-time adjuncts or graduate instructors, with no job security from one semester to the next, working at a piece rate with few or no benefits across multiple workplaces, and far too often struggling to make ends meet.”  Just as so many other professional middle-class jobs are being downsized and casualized, the government is beginning to see how higher education has also been reshaped by neo-liberal policies.

The report highlights the contradiction of relying on colleges to prepare people for good jobs, while the people teaching at these institutions have bad jobs: “Increasing the number of Americans who obtain a college degree or other post-secondary credentials is a key to growing and strengthening the middle class and ensuring the country’s global competitiveness. Yet the expanding use of contingent faculty to achieve this goal presents a paradox. These instructors are highly educated workers who overwhelmingly have post-graduate degrees. They perform work critical to our national efforts to lift the next generation’s economic prospects. In 2009, CNN Money ranked college professor as the third best job in America, citing increasing job growth prospects. The Bureau of Labor Statistics predicts post-secondary teachers as having faster than average employment growth over the next decade. Having played by the rules and obtained employment in a highly skilled, in-demand field, these workers should be living middle-class lives.”

Although in the popular imagination, professors still represent one of the most attractive careers, the reality of this labor market is far from ideal: “More than one million people are now working as contingent faculty and instructors at U.S. institutions of higher education, providing a cheap labor source even while students’ tuition has skyrocketed. Traditionally, adjuncts were experienced professionals who were still working in or recently retired from their industry outside of academia, with time on their hands to teach a class or two at the university or community college. Adjunct work supplemented their income; teaching was not their main job. Such adjuncts still exist. But national trends indicate that schools are increasingly relying on adjuncts and other contingent faculty members, rather than full-time, tenure-track professors, to do the bulk of the work of educating students. Today, being a part-time adjunct at several schools is the way many instructors cobble together full-time employment in higher education.” Part-time and contingent faculty are thus a symptom of the more general dismantling of the middle-class professions.

The congressional report also ties the casualization of the academic labor force to the question of educational quality:  “contingent faculty earn low salaries with few or no benefits, are forced to carry on harried schedules to make ends meet, have no clear path for career growth, and enjoy little to no job security. The contingent faculty trend appears to mirror trends in the general labor market toward a flexible, “just-in-time” workforce, with lower compensation and unpredictable schedules for what were once considered middle-class jobs. The trend should be of concern to policymakers both because of what it means for the living standards and work lives of those individuals we expect to educate the next generation of scientists, entrepreneurs, and other highly skilled workers, and what it may mean for the quality of higher education itself.”  While the report does argue that many non-tenure-track faculty bend over backwards to provide the best education possible, their working conditions often prevent them from performing to their full potential.

This report grew out of an open online forum at the behest of Rep. George Miller.  He asked contingent faculty to write in and respond to a series of questions, and then his staff analyzed some of the trends.  For instance, they found that the average annual salary of the people responding was $24,926 and that 75% did not have benefits. One respondent added the following: “Considering that students pay $565 per course, and that there are approximately 20 students per class, adjuncts are paid approximately 4% of what the university takes in even though we execute the core requirements of the university. As an open enrollment university with 86% Title IV students, dedicated adjuncts must provide extensive, time-consuming feedback frequently up to 20 hours per week, which averages a wage of less than $10 per hour.” As my own research has consistently shown, higher tuition often results in less money going into instructors’ salaries; instead undergraduates are forced to secretly subsidize administrative growth, sponsored research, graduate and professional education, and expensive extra-curricular activities.

To its credit, the report does acknowledge some of the reasons why undergrads are paying more for lees as faculty are forced to work for poverty wages: “In today’s lean era, schools have often chosen to balance their budgets on the backs of adjuncts. Outsized administrator salaries, marketing operations, and campus frills recently have received significant attention. Increased budget transparency for institutions of higher education would be a critical step in understanding the nature and necessity of this now-pervasive labor practice and whether and how it may be changed.”

Let us hope that this report forces the government to look seriously at my plan to tie full funding for public higher education to a requirement that 75% of the faculty are full-time and at least 50% of the state and federal funding goes to direct instructional spending.  Although we can make some improvements on the campus level, we need a national solution to a national problem.  

Tuesday, January 21, 2014

The High Cost of Research

In response to state budget cuts for higher education and new laws regulating the selling of academic patents, universities since 1980 have increased their spending on research.  Although many people believe that research brings extra revenue to these institutions, a recent study reveals how research activities rarely cover their true costs. In Understandingthe high Cost of Success in University Research,"Karen Holbrook and Paul Sanberg show how in the case of two university systems, “the findings demonstrated that 40 cents was spent from university funds for each one dollar of external funding received.” If we apply this same math to the University of California’s research budget of $5.2 billion, we can assume that UC had to find an additional $2 billion from other sources to make up for the additional costs. 

One of the main reasons why research grants rarely cover their full costs is that the federal government only allows 26% of the indirect costs to go to administration, but this amount rarely covers the full administrative cost: “In 1991, the administrative component of the F&A rate was capped at 26% for universities only. Now, more than 20 years later, the 26% remains as a cap even though virtually every research university can easily document the real cost of administration at a significantly higher level.” As we know from the UC system, over the last thirty years the salaries and number of administrators has grown significantly.

Another reason why grants do not pay for their own activities is that universities, like the UC system, tend to receive much of their funding from sources that do not pay even the average federal rate of 52%: “A significant consequence of accepting a large number of awards with low F&A rates of reimbursement is that the effective F&A rate for universities is nowhere close to their federally negotiated rate. The effective rate for top research universities nationally is in the range of 20–25% of awards.”  In fact, in a study of UC research, it was found that state and corporate grants bring the average UC indirect cost recovery rate to 26%.

Research also loses money because of the need for new technology and increased regulation: “the costs continue to escalate with more federal and state mandates for compliance with new regulations and with the general rising costs of facilities and equipment, personnel support, and the need to turn over high-tech equipment that is rapidly outdated.” Due to the arcane nature of university budgeting, these escalating costs are rarely acknowledged.

Another related issue is the question of what is considered to be the direct costs versus the indirect costs of a grant: “many of the activities that are necessary to support research (such as administrative and clerical support, computers, postage, subscriptions, telephone service, and office supplies), once covered among the direct costs of a research grant budget, can no longer be considered direct charges and must be paid for by the overhead dollars (indirect costs) that accompany a grant award or by some institutional source.” Thus, as the definition of what can be called a direct cost changed, universities were forced to spend more of their money on indirect costs, but these indirect charges were unable to keep up with the real costs. 

Meanwhile, as states cut their funding for higher education, money that was formely used to support research has disappeared: “A survey conducted by the Association of Public and Land-grant Universities (APLU) (5) revealed that reduced state appropriations impact several areas of the research enterprise: loss of faculty and staff, diminished ability to maintain campus infrastructure, limited support for graduate students, reduced support for public/private partnerships, and cuts in externally supported research, as well as ongoing research projects.” In a perverse feedback loop, the more states cut their funding for research, the more universities look for funding from outside sources, which results in the research mission losing even more money.

The conclusion from this study should not be that we abandon the research mission of research universities, but we need to find ways of paying for it, and non-transparent budgeting does not help the process.  Some possible solutions are to negotiate a much better indirect cost recovery rate for all grants.  Another needed reform is to reduce the number of highly paid administrators attached to the research mission.

Tuesday, January 14, 2014

Student Debt, Free Public Higher Ed, and Federal Loan Sharks

As I go around the country talking to different groups about my book on how to make public higher education free, I continue to encounter student debt horror stories, but there is perhaps no story more horrible than the recent Congressional Budget Office report on how the federal government raked in over $50 billion last year in profits from student loans. It turns out that after the feds took over the destructive private loan industry, the result was not to give students the best deal possible, but to cash in on the fact that the government can borrow money at virtually no interest and lend it to students at a much higher rate (of course the government profits go up much higher when students default or are penalized for late payments).  In fact, the average student loan defaulter pays a penalty of over 100% of the principal, and the federal government is very good at collecting these debts.  

Although I do not think it was the intention of the Obama administration to turn indebted students into cash cows, a systemic analysis tells us that the federal government is profiting from the state reduction of funding for public higher education, which in turn has helped to cause the increase in student tuition at public institutions, which increases student debt, and at the same time, increases in the number of students going to high-cost, low-performing for-profit colleges. 

I recently had the opportunity to talk to the new UC president Janet Napolitano about the fact that what we need is a new compact among the federal government, state governments, and public institutions of higher education. I believe she is dedicated to working on this issue, but it is hard to imagine the feds walking away from their new profit center – indebted students.   

If there was ever a sign that we need a totally new model for funding public higher education, we now have it in the extraction of profit from indebted students.