Higher Education

Oklahoma’s Higher Education Spending Far Outstrips National Average

November 19, 2015

J. Scott Moody, Wendy Warcholik, Ph.D.

As we pointed out in these pages in October, Oklahoma’s higher education system employs far too many non-instructional workers relative to the national average. This bloated workforce drives up the cost of higher education, and a significant share of these costs falls on the shoulders of Oklahoma’s taxpayers.

The U.S. Census Bureau keeps track of all types of data on the higher education system. The chart below uses the latest Census data to examine the dramatic size and growth in higher education spending (from all sources—federal funds, state funds, tuition, boarding, etc.) as a percent of the private sector share of personal income between fiscal year (FY) 1992 and FY 2013.

There are two major points to be gleaned from this chart. First, average spending over this time period on the Oklahoma university system is a whopping 61 percent higher than the national average (3.2 percent vs. 2 percent, respectively) and averaged the 10th highest level in the country.

Second, and even more troubling, is that the linear growth line shows that the rate of higher education spending is higher than the national average—even despite the recent private-sector energy boom which dramatically drove down the burden of higher education spending in recent years.

Overall, this chart shows the consequences of the bloated workforce of Oklahoma’s university system. Rightsizing the workforce by eliminating non-instructional workers will reduce the cost of higher education for aspiring students and reduce the tax burden on Oklahoma’s taxpayers.

OCPA research fellow J. Scott Moody (M.A., George Mason University) serves as chief executive officer of State Budget Solutions. Formerly a senior economist at the Tax Foundation and a senior economist at the Heritage Foundation, he has twice testified before the Ways and Means Committee of the U.S. House of Representatives. Moody is the co-creator (with Wendy P. Warcholik) of the Tax Foundation’s popular “State Business Tax Climate Index.” His work has appeared in Forbes, CNN Money, State Tax Notes, The Oklahoman, and several other publications.

OCPA research fellow Wendy P. Warcholik (Ph.D., George Mason University) directs the Family Prosperity Initiative for the American Conservative Union Foundation. She formerly served as an economist at the U.S. Department of Commerce’s Bureau of Economic Analysis, and was the chief forecasting economist for the Commonwealth of Virginia’s Department of Medical Assistance Services.