Director: Daniel C. Levy

U.S. Private University Presidents Earn More

PROPHE Summary (by Hirosuke Honda):

The Chronicle's survey on college presidents' earning reveals that five presidents in private universities earned more than $1 million in a single year (2003-04). In the same sector, about 70 presidents earned more than $500,000 over the previous year. Although not as remarkable, twenty-three public university presidents made more than $500,000. One reason given for such increasing earnings stems from the universities' attempts to find a comparable replacement for talented baby-boom president retirements.

Rising presidential salaries and attention to them are connected to the nature of marketization in U.S. higher education. Intensified competition, while guaranteed state subsidies decline, makes institutional leaders more important than before, particularly on the financial side. Presidents with a business skill package involving matters such as management, marketing, and fundraising are in increased demand. This is true for not only private institutions but for partly privatizing public ones (notwithstanding some limiting state statutes). It seems that at least two features make the U.S. stand out. One of course is the exceptionally high payments. Another is comparative transparency. For example, confidentiality is paramount in Japan and Thailand, though $200,000 is a guess for the president of the University of Tokyo, Japan's leading public institution. Japan's new policy of semi-privatizing public universities may even be having the effect of cutting public salaries to presidents.