Trustees | Costs

These college presidents make over $1 million (their students go on to earn a lot less)

The 20 highest-paid private college presidents each earned more than $1 million in 2013
MARKETWATCH   |  December 8, 2015 by Jillian Berman

Students who graduate from private colleges with the highest paid college presidents will likely have to work for decades to earn what the president makes in just one year.

The 20 highest-paid private college presidents each earned more than $1 million in 2013, according to the Chronicle of Higher Education. Meanwhile, students who attended those schools earned anywhere between $37,500 and $81,100, on average 10 years after leaving school, according to government data on the outcomes of federal student loan borrowers.

That means students who go to these schools and earn a relatively high salary 10 years after graduating would have to do over 15 years’ worth of work to earn what their college president makes in a year. And students who earn a relatively low salary would have to earn more than 75 years’ worth of salaries to make the same amount as their college president.

The financial well-being of students post-graduation typically doesn’t factor into decisions on a college president’s salary. Instead, college boards of trustees take all sorts of other metrics into consideration such as the salaries of college presidents at peer institutions, how much money they raise for the school, the recognition they’re able to draw to the college and the programs they start or grow at the school.

But as college graduates are increasingly forced to cope with growing tuition costs, high levels of student debt and a sluggish job market, it’s not unfair to ask for a “cautious relationship” between the salaries of college presidents and that of the students they educate said Michael Poliakoff, the vice president of policy at the American Council of Trustees and Alumni, a nonprofit focused on accountability and academic freedom in higher education.

Those comparisons are reasonable for the public and policymakers to make “when students are leaving with a lot of debt, when many of them are in arrears with their loan repayment, when they’re typically not going to be earning salaries commensurate with the enormous amount that’s being paid in tuition,” he said.

Of course, a university’s success is measured by more than just simply the salaries of its students, Poliakoff said. MarketWatch reached out to representatives of all of the universities on the list and many highlighted the increases in selectivity, diversity, endowments, research and growth of the campus itself over their presidents’ tenure as reasons for their relatively high compensation.

Many also noted that their presidents are making comparable salaries to those at peer institutions. And given that the Chronicle takes a whole slew of benefits into account when calculating their total compensation, including certain one-time retirement benefits or deferred compensation stretching back several years, their pay levels may appear larger than they actually are, according to some of the university representatives. Many also highlighted that their presidents are major donors to their schools.

The College Scorecard earnings data also only captures the salaries of students who used federal financial aid to attend each school. It’s possible that the average salaries of the overall student population are higher than what’s reported in the Scorecard.

Still, some of the discrepancies are troubling. Nido Qubein, the president of High Point University in North Carolina, has the third-highest salary on the list. At the same time, students who receive federal financial aid at his school earn just $37,500 on average 10 years after starting. That’s about $3,000 more than the median earnings of former students who received federal financial aid 10 years after they entered school, according to the government data. At High Point, which costs $33,943 a year on average, according to the College Scorecard, just 66% of students earned more than those with only a high school diploma.

Under Qubein’s tenure, which began in 2005, High Point created programs to prepare students for in-demand fields such as pharmacy and graphic design, Pam Haynes, a High Point spokeswoman wrote in an email. She added that early data indicate that more than 97% of 2014 graduates were placed in a job within six months of graduating. “President Qubein’s compensation is reflective of the transformation he has led and continues to lead in order to prepare HPU for the next century,” she wrote.

Regardless of a college president’s achievements, an administrator’s high salary can create tension among faculty and students, said Poliakoff. He said he would like to see more college presidents eschew the high pay and pomp and circumstance, like welcoming parades or parties, that often come with taking the helm of a university and instead recognize that the current economic situation calls for some sacrifice.


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