Why do universities cost so much? Why has inflation raised the price of post-secondary educations far above that of inflation? It seems to me the largest cost for universities are the salaries, all of them extremely generous, of their staff, none of whom, especially the professors, seem to be terribly overworked. Why do we pay the people who run universities more than we pay the guy who runs the country?
I'm skeptical that salaries are the largest costs at universities. They have huge capital expenditures. I'm astounded every time I return to Edmonton by how much the University of Alberta continues to grow. Here at home Kim City College has transitioned to become UBC Kim City, adding degree programs, new buildings, new facilities, and new housing to provide education options for students outside the Lower Mainland. As well, professors aren't just interchangeable parts. They're researchers and experts in their field. They command high salaries because their skill-sets are scarce and sought after... just like any other high-salaried individual be it a CEO or a star hockey player.
But if you examine the history of tuition fees in Canada, I think you'll find all that is beside the point.
This article:
http://higheredstrategy.com/are-teaching-costs-increasing-at-canadian-universities/makes the case that core teaching costs aren't actually rising at all.
In this graph the orange line is core teaching costs and the blue is tuition:
You can see that the orange line is pretty flat while the blue line takes off like a rocket in the early 1990s. What happened in the early 1990s? Well, the all-comsuming drive to balance the budget. The author argues "the 1990s were a time of disinvestment, so in part higher tuition fees were replacing government spending" but also that "between 1990 and 2005 or so there were some fairly major changes to the way universities spend their money. A lot more money went into IT, student services, scholarships (and, yes, administration), meaning that core instructional costs shrunk as a percentage of total expenditures."
-k