Guest Opinion: Let’s really reform state universities

Published 12:49 pm Thursday, February 2, 2023

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By John Hood

Are North Carolina policymakers thinking big enough about the future of post-secondary education and training? I’m not convinced they are.

For many administrators, trustees, governors and state lawmakers, the main questions center on such issues as declining college and university enrollments, faculty pay, admissions policies and free speech and political indoctrination on campus.

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I share their interest in these issues. I’ve written about most of them in recent months. But I think we need to be asking a more fundamental question: do North Carolinians receive an adequate return on the relatively large investment they make in the UNC system? I would submit the answer to this question is clearly no.

I would also admit some of you may be puzzled the phrase “relatively large investment.” Because UNC tuition and fees are low by national standards, you may think we run a low-cost university system. You are mistaken. As I observed in a previous column, North Carolina has a low-tuition policy but not a low-cost policy. Few legislatures appropriate as much to public universities as ours does.

Turning from revenues to spending, I found that UNC-Chapel Hill had the highest expenditures on core functions among its peer “public Ivy” institutions: $78,488 per full-time-equivalent student. Michigan ($74,437) was second. The lowest-spending institutions were Texas ($59,810) and Berkeley ($62,063). When I further excluded research and public service and focused only on instructional expenditures, student services and academic support, Chapel Hill’s costs were still on the high side — $35,578 per FTE student, less than Michigan’s $37,192 but still significantly higher than the likes of Virginia ($31,284), Texas ($30,775) and Florida ($22,481).

Now, spending more money than average (regardless of source) on state universities might be justified if we ended up with more and better educated graduates whose higher levels of productivity made themselves and their neighbors better off. As far as I can tell, however, this does not appear to be the case. North Carolina doesn’t have more graduates than otherwise-comparable states, or exhibit other measurable benefits from operating a higher-cost university system.

When the Texas-based Foundation for Research on Equal Opportunity conducted a return-on-investment study of undergraduate programs at state colleges and universities across the country, the median student in South Dakota fared best with a lifetime ROI of $216,927, nearly twice the national median of $118,182. Other high-ranking states included Iowa, Minnesota, Virginia, Texas, Arizona, Michiga and Pennsylvania. North Carolina’s median return-on-investment was $106,921, falling below the national median.

A recent study published by North Carolina’s Martin Center for Academic Renewal evaluated both undergraduate and graduate programs at UNC campuses by comparing the average debts incurred by students to the average earnings of graduates. While most programs did okay by this metric, and some fared very well, a sizable number rated so poorly that the Martin Center recommended they either be “sanctioned” or “sunsetted.” These included fine-arts degrees at several campuses as well as certain other language, psychology, sociology and liberal-arts degrees.

My own view about such programs is that most of the students who enter them know very well their chosen careers are unlikely to be lucrative. They have chosen those careers because they value other forms of compensation more — personal fulfillment, a calling to help others or a desire to live and work in a particular kind of community.

Sounds fine to me, but that doesn’t get policymakers off the hook. Why not come up with less-expensive ways to prepare for such careers, such as three- or even two-year programs? That may not be in the interest of current faculty members or of universities seeking to goose overall enrollments. It would certainly be in the interest of the students themselves, however, and of the taxpayers who foot most of the bill in North Carolina.

More broadly, we ought to reconsider how often we substitute quantity measures (how many years of education completed) for more-direct measures of what graduates learn to do. The current system costs too much. Let’s rethink it.

John Hood is a John Locke Foundation board member. His latest books, Mountain Folk and Forest Folk, combine epic fantasy with early American history (