Keeping a Notre Dame Education Accessible
An area of concern for us in remaining financially sound and affordable to our students is the steady growth in the number of people employed by Notre Dame in recent years. Currently, salary and benefits for those employed by the University are the single greatest percentage of University costs, at 60% of total expenses. In the past decade, staff has grown by 30% and faculty by 14%. Such growth is understandable, for we are doing many more things. In the last decade, Notre Dame’s undergraduate enrollment has remained relatively stable, growing by just 2.5%, while post-baccalaureate enrollment has increased 15.5%, resulting in a student body growth of 6.3%. Research expenditures have grown by an extremely impressive 160%, and such increased activity requires, in most cases, many more people to support the work. We have launched the Keough School of Global Affairs, significantly increased our international presence, and worked with the local community to make our region a better place to live for everyone. We have established the IDEA Center, which will help move the discoveries of faculty and students to commercial viability. Our information technology infrastructure has been upgraded so that it can better support the work of an excellent research university. The Office of Student Enrichment has been added to increase support for our low-income and first-generation students, and we are strengthening residence hall life with several new dorms. We have added 27% more new space, and those buildings require support staff to maintain. For these and many other good reasons, the number of those employed at Notre Dame has grown.
"To the extent that these and other efforts to increase efficiency will reduce costs, we will direct savings to endowment for financial aid, to relieve burdens on our students and families, and make a Notre Dame education accessible for all qualified and admitted students."
At the same time, we have seen a significant shift in the University’s sources of revenue. Where tuition once represented 40% of the University’s source of income, it now represents just 33%. Concurrently, revenue produced by the endowment for the operation of the University grew over the last decade to 38% from 27%. This shift brings Notre Dame more in line with other leading research universities, but it raises concerns for the future. If we sustain for the next 10 years the rate of growth in the number of people employed that we saw in the last 10 years, staff will increase by another 36%, and compensation will increase by 85%. Such growth is simply not sustainable. We cannot expect to increase significantly the number of students or the dollars from tuition. Moreover, while we expect good returns from our endowment, and we hope for continued benefaction and for revenue from other sources, we cannot expect total revenue to increase to a proportion that will cover such a sustained rate of growth.
We believe that, in general, the size of our faculty is currently appropriate, though we recognize that the number of faculty in specific departments or academic units may need to change due to a variety of factors. In addition, as funds for endowed chairs are provided through benefaction, we are able to add a faculty position without putting a strain on our budget.
As I mentioned earlier, however, staff numbers have grown at twice the percentage of the increase in faculty. While we understand the pressure to grow staff in various areas, the rate of growth is unsustainable, and we must find ways to control it. In coming weeks we will announce several steps to do so. We do not foresee layoffs. Our focus will be on restraining growth and, when possible, reallocating to the highest and best use of resources. We hope thereby to make the University more efficient and financially sound in the future. To the extent that these and other efforts to increase efficiency will reduce costs, we will direct savings to endowment for financial aid, to relieve burdens on our students and families, and make a Notre Dame education accessible for all qualified and admitted students.