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I believe you've been misled about "large majority of their money from international students" and am curious where you got this information from. From the data

I believe you've been misled about "large majority of their money from international students" and am curious where you got this information from. From the data I've looked at, the net revenue a vast majority of colleges make are under 2% from international students. For R1 universities (the national ones you've heard of), it's still under 10% , and finally even if you look at undergraduate tuition only (ignoring graduate students, ignoring other sources of revenue), it's still not the majority.

bachmeier 6y ago
"Most profitable" would be correct for most universities.
throwawaygh 6y ago
Look at the bottom line, not the top line. PhD students are incredibly cheap and do a lot of the revenue-generating work; namely, classroom teaching and research. PhD students earn between $20K/yr and $30K/yr in stipend. For the university, that is damn close to the ALL-IN cost! The university pays no FICA taxes and does not contribute to retirement for these employees. For this reason, in high-demand fields like Computer Science, 60+% of PhD students are foreign nationals. And the domestic students are often over-represented at top-tier universities. So there are lots of CS departments where the majority of the revenue-generating employees are foreign nationals making $20K/yr all-in. A PhD student instructing or leading recitations for university courses makes less than 1/2 of what a first year high school teacher makes. A PhD student doing research is bringing in typically $100K - $200K in grant money but only receiving about $30K of that. Also, again, the "2x multiplier" used to calculate the total cost of a normal employee doesn't apply here because the university does not pay FICA taxes, doesn't contribute to retirement, and often gets great tax breaks and gifts to cover things like real estate (=office space). For universities the "total cost of a PhD student" multiple is more like 1.2x salary. Professors are managers. Deans and so on are executives. PhD students are the "bread-and-butter" employees of the university. They are the ones who do the bench work/coding and the vast majority of face-to-face teaching. Without international PhD students, universities' total cost of operation would skyrocket.

bachmeier 6y ago

"Most profitable" would be correct for most universities.

throwawaygh 6y ago

Look at the bottom line, not the top line. PhD students are incredibly cheap and do a lot of the revenue-generating work; namely, classroom teaching and research. PhD students earn between $20K/yr and $30K/yr in stipend. For the university, that is damn close to the ALL-IN cost! The university pays no FICA taxes and does not contribute to retirement for these employees. For this reason, in high-demand fields like Computer Science, 60+% of PhD students are foreign nationals. And the domestic students are often over-represented at top-tier universities. So there are lots of CS departments where the majority of the revenue-generating employees are foreign nationals making $20K/yr all-in. A PhD student instructing or leading recitations for university courses makes less than 1/2 of what a first year high school teacher makes. A PhD student doing research is bringing in typically $100K - $200K in grant money but only receiving about $30K of that. Also, again, the "2x multiplier" used to calculate the total cost of a normal employee doesn't apply here because the university does not pay FICA taxes, doesn't contribute to retirement, and often gets great tax breaks and gifts to cover things like real estate (=office space). For universities the "total cost of a PhD student" multiple is more like 1.2x salary. Professors are managers. Deans and so on are executives. PhD students are the "bread-and-butter" employees of the university. They are the ones who do the bench work/coding and the vast majority of face-to-face teaching. Without international PhD students, universities' total cost of operation would skyrocket.