Dive Brief:
- In rough economies, colleges are less likely to spend their endowments, even though such funds could help cushion budget blows.
- That's the finding of a paper that looked at spending during the latest downturn, which also found that support staff are the first to go when colleges face budget troubles.
- Tenure-track faculty positions are usually cut by attrition or reduction in hiring; adjunct positions and administrators were largely unaffected.
Dive Insight:
One of the paper's authors says it calls into question exactly what purpose college endowments serve: "If you’re not going to use the money when you need it the most, then when exactly are you going to use it?" U.S. Sen. Chuck Grassley has repeatedly called endowments into question, pushing for the wealthiest colleges to use the money they're sitting on. As he put it in 2011, he feels that those colleges are "hoarding assets at taxpayer expense," essentially forgetting their responsibility to the public.
