Image courtesy Juan Salmoral
Coastal Americans find it shocking that Minnesota ranks #3 in the ‘Best States Rankings', a list which U.S. News and World Report says ‘draws on thousands of data points to measure how well states are performing for their citizens.’ Life abounds at the center of North America, regardless of its icy winters. Minnesota’s vivaciousness comes partly from its hearty education system, including a host of private colleges. In fact, one strip of land following Snelling Avenue is one of the most college-densely populated areas in the country. Driving along the street looking at college options can be overwhelming.
This write-up, and the next one, examine 16 of the states most popular private colleges to identify what public data from the Star Tribune and U.S. News have to say about top-ranking schools, their leaders, and why some schools perform better than others. In short, Minnesota’s top private colleges have strong endowments, not unlike you might expect for great schools anywhere. Schools with the biggest endowments link to other important factors, particularly being high in national rankings. Beyond the top 2 schools, the trends get a little hazier.
Minnesota’s 3 most prestigious schools, Carleton, Macalester, and St. Olaf, each fall on U.S. News’ National Liberal Arts Colleges list. Within a category for Midwest Universities, a separate list for mid-sized universities in the Midwest region, Minnesota is known for Hamline, St. Catherine, and Bethel, each for different specific areas of expertise. St. Thomas is the states only large private university. Although it appears to rank lower, its category includes large private universities across the country.
You might expect, then, that the best performing schools pay their president’s more. Do they? The answer is not necessarily, but there are a few trends to note. In the chart below, notice that presidents of liberal arts colleges are generally paid more than their counterparts at Midwest universities.
Another clear take-a-way is that the states two most prestigious colleges pay their president’s significantly more than the rest do. Why Macalester’s President gets paid more than Carleton’s is a mystery. Macalester ranks 22 positions lower. It brings in 24% less revenue. It’s endowment is 10% smaller. From basic data, it appears to be 90% less profitable, at least in 2017. Yet, for no apparent reason, it pays its president 39% more.
Within the Midwest universities classification, there isn’t a ranking-compensation trend to note. After much analysis, it appears that compensation isn’t correlated to anything. Not revenue, not profitability. Not endowment size. Speculatively, perhaps some schools pay their presidents less, even if they rank higher than others, for mission-based reasons. Private schools are non-profits, after all.
On the flip-side of that, why do some schools pay their president’s more? That’s also uncertain. But, what’s not uncertain is that Hamline’s president, Dr. Miller, worked happily in 2017. According to the Star Tribune, Hamline increased their presidential comp by 141% from 2016 to 2017. Are we talking about the manager of a hedge fund in a good year, here? The next highest increase from another school was 17% at Concordia (St. Paul) and the average increase from all other schools other than Hamline was 4%. So, yes, at a 35x greater increase in salary by percentage points, Ms. Miller ought to be thrilled.