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Expenditures

Question:
How much do colleges and universities spend on students?

Response:

In 2018–19, degree-granting postsecondary institutions in the United States1 spent $632 billion (in current dollars). Total expenses were $401 billion at public institutions, $219 billion at private nonprofit institutions, and $12 billion at private for-profit institutions. Some data may not be comparable across institutions by control categories (i.e., public, private nonprofit, and private for-profit) because of differences in accounting standards. Comparisons by institutional level (i.e., between 2-year and 4-year institutions) may also be limited because of different institutional missions. The missions of 2-year institutions generally focus on providing student instruction and related activities through a range of career-oriented programs at the certificate and associate’s degree levels and preparing students to transfer to 4-year institutions. Four-year institutions tend to have a broad range of instructional programs at the undergraduate level, leading to bachelor’s degrees, and many offer graduate-level programs as well. Research activities, on-campus student housing, teaching hospitals, and auxiliary enterprises2 can also have a substantial impact on the financial structure of 4-year institutions. In this Fast Fact, expenses are grouped into the following broad categories: instruction; research and public service; academic support, student services, and institutional support; net grant aid to students3; auxiliary enterprises; hospital services4; and independent operations and other.5

Instruction, including faculty salaries and benefits, was the largest single expense category at public 2-year (40 percent), public 4-year (27 percent), and private nonprofit 4-year (30 percent)6 degree-granting postsecondary institutions in 2018–19. At private nonprofit 2-year institutions and private for-profit 2- and 4-year institutions, the largest expense category was the combined category of academic support, student services, and institutional support, which includes expenses associated with noninstructional activities, such as admissions, student activities, libraries, and administrative and executive activities. These combined expenses constituted 62 percent of total expenses at private nonprofit 2-year institutions, 54 percent of total expenses at private for-profit 2-year institutions, and 66 percent of total expenses at private for-profit 4-year institutions.

In 2018–19, combined expenses for research and public service (such as expenses for public broadcasting and community services) constituted 16 percent of total expenses at public 4-year institutions and 12 percent of total expenses at private nonprofit 4-year institutions. Combined expenses for research and public service were 2 percent of total expenses at public 2-year institutions and less than one-half of 1 percent of total expenses at private nonprofit 2-year institutions, private for-profit 2-year institutions, and private for-profit 4-year institutions.


Percentage distribution of total expenses for degree-granting postsecondary institutions, by level and control of institution and expense categories: 2018–19

The data in this figure is described in the surrounding text.

† Not applicable.

# Rounds to zero.

1 For private for-profit institutions, expenses associated with hospital services are included in the "other" category. Expenses for independent operations are not applicable for for-profit institutions.
2 Expenses associated with a hospital operated by the postsecondary institution and reported as a part of the institution; include nursing expenses, other professional services, general services, administrative services, and fiscal services as well as information technology expenses, actual or allocated costs for operation and maintenance of plant, interest, and depreciation related to hospital capital assets.
3 For public institutions, net grant aid to students includes scholarship and fellowship expenses, net of discounts and allowances. Excludes the amount of discounts and allowances that were recorded as a reduction to revenues from tuition, fees, and auxiliary enterprises, such as room, board, and books. For private nonprofit and private for-profit institutions, excludes tuition, fees, and auxiliary enterprise allowances and agency transactions, such as student awards made from contributed funds or grant funds.
4 Auxiliary enterprises, such as residence halls and food services, are essentially self-supporting operations of institutions that furnish a service to students, faculty, or staff.

NOTE: Data are for the 50 states and the District of Columbia. Degree-granting institutions grant associate’s or higher degrees and participate in Title IV federal financial aid programs. Although rounded numbers are displayed, the figure is based on unrounded data. Detail may not sum to totals because of rounding.


In 2018–19, total expenses per full-time-equivalent (FTE) student7 at degree-granting postsecondary institutions were higher at private nonprofit 4-year institutions ($63,830) than at public 4-year institutions ($47,890) and private for-profit 4-year institutions ($17,190). For instruction expenses, private nonprofit 4-year institutions spent 51 percent more per FTE student ($19,310) than did public 4-year institutions ($12,750) and 330 percent more than did private for-profit 4-year institutions ($4,490). Similarly, for the combined category of academic support, student services, and institutional support, private nonprofit 4-year institutions spent 91 percent more per FTE student ($18,880) than did public 4-year institutions ($9,890) and 66 percent more than did private for-profit 4-year institutions ($11,380). Expenses per FTE student for the combined category of research and public service were much higher at public 4-year institutions ($7,600) and private nonprofit 4-year institutions ($7,540) than at private for-profit 4-year institutions ($40). Among 2-year institutions, instruction expenses per FTE student were 16 percent higher in 2018–19 than in 2009–10 at public institutions ($6,940 vs. $5,970) and 21 percent higher at private for-profit institutions ($5,770 vs. $4,760).


1 Data in this fact represent the 50 states and the District of Columbia.

2 Auxiliary enterprises, such as residence halls and food services, are essentially self-supporting operations of institutions that furnish a service to students, faculty, or staff.

3 For public institutions, net grant aid to students includes scholarship and fellowship expenses, net of discounts and allowances. Excludes the amount of discounts and allowances that were recorded as a reduction to revenues from tuition, fees, and auxiliary enterprises, such as room, board, and books. For private nonprofit and private for-profit institutions, excludes tuition, fees, and auxiliary enterprise allowances and agency transactions, such as student awards made from contributed funds or grant funds. These exclusions account for the majority of total student grants.

4 Expenses associated with a hospital operated by the postsecondary institution and reported as a part of the institution; include nursing expenses, other professional services, general services, administrative services, and fiscal services as well as information technology expenses, actual or allocated costs for operation and maintenance of plant, interest, and depreciation related to hospital capital assets.

5 For private for-profit institutions, hospital expenses are included in the “other” category. Expenses for independent operations are not applicable for for-profit institutions.

6 Although both instructional expenses and the combined expenses for academic support, student services, and institutional support categories constituted 30 percent of total expenses at private nonprofit 4-year institutions, instructional expenses were slightly higher.

7 Expenses per FTE student in this Fast Fact are adjusted for inflation using constant 2019–20 dollars, based on the Consumer Price Index (CPI), prepared by the Bureau of Labor Statistics, U.S. Department of Labor, adjusted to a school-year basis.

SOURCE: U.S. Department of Education, National Center for Education Statistics. (2021). The Condition of Education 2021 (NCES 2021-144), Postsecondary Institution Expenses.

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