Here’s what the highest salary of any university president in America was in 1983 in 2022 dollars: $342,000.

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The above quote comes from Paul Campos, who also reports that “The mean (not the median) compensation of university presidents [in 1983] was $184,000 (again 2022 dollars!).” And, perhaps even more amazingly, that the highest-paid college football coach in 1981 (Oklahoma’s Barry Switzer) “was making $150,000, including benefits, which is $457,000 in 2022 dollars.”

This got me curious. I took my first academic job in 1990 and my salary was $42,000. According to the inflation calculator, that’s worth $90,000 today. That must not be far from what we pay new faculty. But maybe there’s more spread on the high end than there used to be? I don’t know how much the senior faculty were paid back in 1990, or 1983, but I guess it was less than the university president.

Regarding the university presidents and football coaches: in addition to their take-home pay and benefits, they also were given subordinates: secretaries and assistants and coaches and so forth they could boss around. This makes me think that part of the salary change was a delayed transition, stimulated by the tax cuts of the 1980s, toward paying in $ rather than perks?

In any case, lots of faculty nowadays (regular faculty like me, not law/biz/medicine or coaches) get paid more than all the college presidents were in 1983. Amazing. Again, I guess the presidents were also paid in kind in the sense that they were allowed to hire a zillion assistants. But still. Imagine someone offering the president of a major university a salary of $184,000 today. He’d be insulted!

Another way of saying this is that in 1983, the range of pay for faculty at a university was about 10 (approx $200,000 at the top compared to approx $20,000 at the bottom). But now the ratio is more like 100 (approx $3 million down to approx $30,000). I guess to look for the reasons for why this is happening, we’d want to look at society and the economy more generally, as what’s happening at the university has been happening in many other institutions.

35 thoughts on “Here’s what the highest salary of any university president in America was in 1983 in 2022 dollars: $342,000.”

  1. A well-known fact that may or may not be true: The highest paid public employee in every state in the U.S. is the football or basketball coach at the state’s public university. From this outdated 2018 website

    https://www.gobankingrates.com/money/business/highest-paid-public-employees/

    “Out of all the highest-paid public employees on this list, 29 held head football coach positions, and most pulled down a hefty annual salary of $1 million or more. Only three head football coaches earned salaries that fell below the $1 million mark. Although football coaches claim the greatest number of spots in this study, not a single basketball coach on the list earned less than $1 million in 2018. In fact, a collegiate basketball coach takes the top spot, bringing home a staggering annual salary that exceeded $9 million.”

    The calculation is somewhat murky because it is difficult to properly factor in all the perks such as free use of vehicles, speaking engagements, bonuses, etc. What is absolutely clear, is that the U.S. is unique in the compensation game. I leave the implications to other contributors to this blog.

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    • The salaries of those coaches may not be all that unreasonable.

      Years ago, I remember reading a discussion of the insane salaries sports stars received, and the bottom line was that they earned their money in terms of generating revenue by creating enthused fans who would purchase tickets and the like. Those “insane” salaries were, if anything, low relative to the value they provided their employers.

      Anyway, my understanding is that for colleges with sports teams, doing well is critical to getting alums to cough up money. So maybe those coaches are actually earning their salaries…

      Off hand, I’d guess that corporate officer compensations will include a lot more problematic cases than the sports world.

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      • David:

        I’ve seen the argument that the high coach salaries are in part a product of the rule that college athletes can’t be paid. The #1 job of a head coach is recruiting. Colleges can’t directly compete for players by offering them money, so instead they need to rely on whatever it is that makes a coach be a good recruiter, and that’s worth a lot of money.

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      • Men’s football and basketball are important to fundraising at many universities. I have no idea what a championship is actually worth in terms of alumni donations but it makes sense there’d be some intense competition for coaches seen as the most likely to deliver.

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    • I should look more carefully at what I suggest others do. So, I found this for the highest paid public employee in North Dakota is

      Name: Larry P. Nybladh
      Job title: Superintendent of schools
      Employer: Grand Forks County
      Total pay in 2018: $231,210

      There are a few other States in that league of lacking big-time collegiate football or basketball. This oddball result from Massachusetts ought to interest Andrew because of the number of significant figures:

      Name: Michael Collins
      Job title: Chancellor of the University of Massachusetts Medical School and senior vice president for health sciences
      Employer: University of Massachusetts
      Total pay in 2018: $1,069,751.67

      A little more looking turns up Maine (.04) and Rhode Island (.88) who go past the decimal point. New Englanders do have a reputation of being tight with money.

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      • coaches are often paid various guaranteed “bonuses” that exceed their bases salaries, so u have to be careful with these comparisons. I’m almost certain the NDSU head football coach gets over $231K, for example.

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  2. With 15-20 years experience, the local high school physical education teachers, pre-algebra teachers, and health instructors in my area make $160,000 a year. Admins make $250,000+ a year.

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  3. Like many, I’ve long been puzzled by this. I think two important aspects are:

    (1) For the people deciding on extravagant pay, it’s not “their money” and there aren’t any downsides to spending more of it. So why not give ridiculous salaries? As an example, my university’s former provost stepped down after a few years on the job and is now a regular faculty member in my department with *three times* my salary. (I’m a full professor.) Why? That’s what his provost contract allowed. Why? Why not?! Who does it harm? The students paying the salary via tuition, of course, but the higher-ups don’t care about that. (He’s a great person, by the way, and I don’t fault him for taking this deal.)

    (2) The salaries of the higher-ups are always influenced by what the mean or median of such positions at other universities. No one wants to be below the mean. So, this constantly ratchets upwards.

    This doesn’t answer the question of why all this is worse now than 30 years ago.

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  4. “Imagine someone offering the president of a major university a salary of $184,000 today. He’d be insulted!” Why assume the president of a major university is male?

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  5. Without any evidence one way or the other, I assume that the large increase in salaries at the top level of university administration reflects the same trend that has taken place throughout the economy. CEOs (and CFOs etc.) make a lot more, as do agency heads and so on. If so, the explanation is not university specific.

    One question is how much influence top administrators have over their own salary — whether they have more now than they used to. That might be the case in the corporate sector, at least prior to the ownership shift to private equity, but I don’t see why it should be true in the public and nonprofit sector.

    If those who actually do control the pay structure think the top echelon plays a greater role in organizational success than they used to, that would need to be explained. One hypothesis is that changes in the technology of information and management have amplified small differences in competence at the top. Another is that technologies that facilitate modularization have led to an increase in contracting out in all its forms (including much greater use of adjuncts in university instruction) and therefore devaluation of frontline workers and line management: who you’ve got in these positions at the moment doesn’t matter so much because they are readily replaceable. Both of these could contribute to a culture shift that extends beyond the cases impacted by these technologies and diffuses throughout the whole society.

    I’d love to see some real research on these questions. Haven’t come across much yet.

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    • Negative take:

      “The Baumol Effect
      Baumol’s cost disease, also known as the Baumol effect, is the rise of wages in jobs that have experienced little or no increase in labor productivity, in response to rising salaries in other jobs that have experienced higher productivity growth.”

      Positive take:

      University Presidents’ (and most CEO’s) responsibilities have dramatically increased since the 1970s (e.g., they are more productive than they used to be):

      1) number of students / faculty rising
      2) demand for higher graduation rates
      3) increasing regulations on university social life
      4) increasing regulations on university academic life
      5) increasing demands for research funding and research performance
      6) increasing demands on physical infrastructure (environmental)
      7) increasing demands for up-to-date research equipment and faster pace of turnover

      not to say that any of this is justified or not, but I can imagine how a university president overseeing a 2K employees and 40K students as well as highly sophisticated research labs and programs might see themselves as equivalent to a tech CEO.

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    • Start with the cantillon effect. Those closest to the newly created money benefit first. In the US that means government along with the wealthy and well-connected who find it easier to get loans.

      Thus you first get price increases in real estate, healthcare, higher education, and investments like stocks/bonds. Within those industries it trickles down and/then out (Federal Reserve calls this the “wealth effect”), eventually getting to low wage earners after the price of everything has risen.

      Quantitatively modelling this process to predict the timing hasn’t been possible though, afaik.

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  6. *Hears that “lots of faculty nowadays (regular faculty like me)” get paid more than USD 184,000 / year*
    Ok, the US is weird and unequal, but …
    *Stares in unemployed person with a PhD who knows many adjuncts and sessional instructors*

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    • Sean:

      When I say “lots,” I don’t mean “a large proportion,” I just mean “a large number.” More than a handful. To put it another way, If you hear that a faculty member gets paid more than $184,000 a year, that doesn’t mean that this person is some sort of superstar; it’s just someone who’s well situated. Just for example, I googled faculty salaries of the department of physics at Ohio State University, and the salaries are $223,000, $223,000, $204,000, $191,000, $166,000, $162,000, $162,000, $162,000, $159,000, . . . I guess all these people are accomplished researchers, but it’s not like any of them are famous. This just seems to be the amount that the university sees as necessary to pay these people. It’s the market rate, I guess.

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      • But again, where I live the going rate for a sessional instructor teaching 15 semester-classes (eg. 5 classes a semester for 3 of 4 semesters, no job security further than a year out) is less than a starting office job with security paid 15 years ago. And the reason for the difference where I live is very clearly that tenured faculty have powerful unions which negotiate automatic annual wage increases, and part-time faculty do not.

        Here are some statistics on average tenured and tenure-track salaries in Canada, remember that 1 CAD ~= 0.75 USD https://www.macleans.ca/education/uniandcollege/professor-pay-ranked-from-highest-to-lowest/

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        • I guess that’s the payback they get for cooperating with the administration on grade inflation and undermining academic integrity to create degree mills and keep that state money and tuition growing.

      • Also, the whole point of your post is why ‘the market’ permits vaster wage disparities in 2022 than 1981 yes? So just appealing to “the market rate” begs the question about what shifted a higher proportion of wages towards a few managers. But US wages seem particularly unequal amongst rich post-industrial countries.

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        • Sean:

          I agree. When I say that these OSU physics professors are being paid “the market rate,” that’s a description, not an explanation. My point in introducing that example is to demonstrate that the very high inequality we’re seeing is not just an effect of competition for superstars; it’s a more general phenomenon.

  8. If you can tolerate a web page that seems to have been designed with a goal of maximizing how irritating its ads are, this Forbes article might be interesting https://www.forbes.com/sites/carolinesimon/2017/09/05/bureaucrats-and-buildings-the-case-for-why-college-is-so-expensive/?sh=22dc7f1f456a Among other things, it says “During the 1980-1981 school year, public and private institutions spent $20.7 billion in total on instruction, and $13 billion on academic support, student services and institutional support combined, according to data from the National Center for Educational Statistics. By the 2014-2015 school year, total instructional costs had climbed to $148 billion, while the same grouping of administrative expenses had risen to $122.3 billion. Put another way, administrative spending comprised just 26% of total educational spending by American colleges in 1980-1981, while instructional spending comprised 41%. Three decades later, the two categories were almost even: administrative spending made up 24% of schools’ total expenditures, while instructional spending made up 29%.”

    There’s a section that gives explanations (some speculative, some data-based), worth a read.

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  10. It has been suggested by others I know that job vacancies for CEO positions and the like should be advertised as tenders for the base salary. Add-ons such as incentives can then be negotiated during interviews of the short listed candidates.

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    • I don’t know the answer to this question, but a related question is answered in the Forbes article I cited again. Here’s the quote again: “During the 1980-1981 school year, public and private institutions spent $20.7 billion in total on instruction, and $13 billion on academic support, student services and institutional support combined, according to data from the National Center for Educational Statistics. By the 2014-2015 school year, total instructional costs had climbed to $148 billion, while the same grouping of administrative expenses had risen to $122.3 billion. Put another way, administrative spending comprised just 26% of total educational spending by American colleges in 1980-1981, while instructional spending comprised 41%. Three decades later, the two categories were almost even: administrative spending made up 24% of schools’ total expenditures, while instructional spending made up 29%.”

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      • In the spirit of this blog’s repeated emphasis on the importance of measurement: take a look at this document: https://nces.ed.gov/ipeds/deltacostproject/download/DCP_History_Documentation.pdf. The issues are not necessarily insurmountable, but it is not straightforward to compare expenditure categories across institutions or over time at the same institutions. There have been changes in which categories various expenses are placed and I believe there is still some ambiguity concerning whether a particular expense is “instructional” or “academic support” (as an example). Such details bore me to the extreme so I am far from an expert. But I’ve looked this this type of data enough to suggest that we need to be careful before relying on such aggregate comparisons as meaningful. Perhaps someone more familiar with the details can shed some light on what comparisons are useful or what modifications are required to make them so.

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    • It’s not pay raises as much as massive expansion of administrative staff. Someone has to be in charge of all those rent seeking projects.

      https://yaledailynews.com/blog/2021/11/10/reluctance-on-the-part-of-its-leadership-to-lead-yales-administration-increases-by-nearly-50-percent/

      Is just one article, it’s not just Yale, it’s industry wide, there are huge numbers of deans and their support staff and people running departments that just didn’t exist in the past .. overseeing the building of all those lazy rivers and things … Just a ton of really important rent seeking and marketing. You gotta pay people to make up numbers for the US News rankings after all!

      https://www.forbes.com/sites/michaelhorn/2019/11/14/why-lazy-rivers-have-their-place-on-college-campusesand-yet-still-might-just-be-lazy/?sh=42c4bac340f7

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    • The best source I know of on this question is the Delta Cost Project: https://www.air.org/resource/report/trends-college-spending-2003-2013-where-does-money-come-where-does-it-go-what-does
      It only covers one decade and is almost 10 years old. But the findings there are that administrative expenses and student-life expenses have risen the fastest, but ‘costs of instruction’ are still by far the largest chunk of expenses, even if not rising as fast. But what Dale Lehman said above is really important: the way these expenses get categorized is very political and sometimes misleading. At my university, I can confirm that a huge amount of salary for grossly overpaid administrators who do no teaching or research would be categorized under ‘costs of instruction’ because of their job titles and the offices in which they work.

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  12. Regarding exchanging perks for salary, college presidents today do not lack for secretaries, assistants, minions, so there has been no exchange of benefits: salaries have gone up, but perks remain undiminished.

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