Economy
What’s behind the explosive growth in Canadian university costs?
From the Macdonald Laurier Institute
By David Clinton for Inside Policy
Dramatic increases in high-end employment costs have been a significant driver of rising university costs.
We’ve probably all seen reports describing out-of-control higher education costs in the United States. An education that in the 1970s could be financed with some savings and a part-time job at the local Burger King will now cost you the equivalent of a down payment on a multi-family investment property.
Those increases are not just the result of regular inflation. When you track US college costs against consumer goods (as the economist Mark J. Perry did), you’ll see that, besides healthcare, rising college-related expenses are unlike anything else.
What changed? The word on the street is that those crazy tuition costs are mostly due to colleges hiring vast armies of non-teaching administrators.
But what about Canadian universities? Back in 2006–07, according to Statistics Canada, across all Canadian universities the average inflation-adjusted cost of one year’s undergraduate tuition was $17,363. Fast forward to 2023–24 – and that same tuition-only cost has now doubled to $34,628.
Note how I referred to those numbers as “costs.” That’s because $34,628 is what you’ll pay if you’re an international student without scholarships. Thanks to government subsidies, Canadians get a big discount. In fact, the average domestic student currently pays only $6,434. But it’s taxpayers who cover the difference.
So, tuition is rising far faster than inflation. But figuring out what’s behind those increases will take some work.
The rise of the university administrator
As the chart shows, since 2001, teaching jobs have dropped from accounting for 17.38 percent of all university positions down to 14.52 percent in 2022. In other words, universities are, proportionally, hiring teaching staff at significantly lower rates than they used to. But please do keep that “proportional” bit in the back of your mind, as we’ll come back to it later.
Source: Statistics Canada/The Audit
However, those numbers don’t tell us who universities are hiring instead of teaching staff. Perhaps they’re building up their food services, security, and custodial crews?
There is at least one identifiable subgroup that’s visibly ballooned: education support services. That North American Industry Classification System category (NAICS Code 6117) includes educational consultants, student exchange program coordinators, testing services, research and development, guidance counsellors, and tutoring and exam preparation services.
Since 2001, the proportion of support services staff in relation to all hires has more than doubled, from 1.06 percent to 2.62 percent. Their absolute numbers across Canada rose from 3,829 to 15,292. (Statistics Canada offers plenty of data and insights on the topics raised in this article. For further investigation, go here, here, and here).
That’s certainly an interesting trend. But an increase of just 1.5 percent isn’t enough to explain the tuition growth we’ve experienced. And I’m also not sure that the “education support services” category maps directly to the class of high-earning administrator they’re talking about in the US. It looks like we could use some more data.
Tracking Salary Changes in Ontario Universities
The year 1996 saw a welcome victory for government transparency when Ontario’s then-Progressive Conservative Premier Mike Harris mandated the annual disclosure of all public sector employees earning more than $100,000. Since that year, the Sunshine List, as it’s popularly known, has grown from just 4,500 names to more than 300,000. However, $100,000 won’t buy you what it once did – especially if you must live in Toronto.
Perhaps we could bring those numbers up to date. Using the Bank of Canada’s inflation calculator, I identified the inflation-adjusted value of 100,000 1996 dollars for 2003 and for 2023. I then identified the individuals on the list who were employed by universities in 2003 and in 2023 and whose salaries were above the inflation-adjusted thresholds. The new thresholds, by the way, were $117,000 for 2003 and $175,000 in 2023.
The first thing that hits you when you see the adjusted data is the explosive growth in hiring. Ontario universities (not including colleges) employed 2,191 individuals earning more than $117,000 in 2003. Twenty years later, the number of employees earning more than $175,000 had ballooned to 8,536. That’s 290 percent growth. The number of people with “dean” in their job description climbed from 195 to 488 during those years. And there are now 6,772 professors on the high earners’ list as opposed to just 1,782 back in 2003.
For context, Statistics Canada tells us that there were 397,776 students enrolled in Ontario universities in 2003 and 579,057 in 2022 (the latest year for which data is available). That’s an increase of 46 percent – which doesn’t justify the 60 percent jump we’ve seen in high-paid deans and the 74 percent increase in similarly high-paid professors.
I think things are starting to come into focus.
Now let’s find out what happened to salaries. Did you know that there’s a strategic management professor who’s earning more than $650,000 annually? And what about that hybrid dean/lecturer who’s pulling in close to $600,000?
Okay… those are probably outliers, and there isn’t much we can learn from them. However, I can tell you that the average university employee in our Sunshine List earned $140,660 back in 2003. Twenty years later, the inflation-adjusted equivalent of that salary would be $211,887. But in the real world – the one that those on the public payroll graciously agree to share with us – the average 2023 university employee on the list earned $220,404. That’s a difference of only 4 percent or so, but that’s after we already accounted for inflation.
Perhaps I can illustrate this another way. The sum of all university salaries above the $117,000 threshold in 2003 was around $308 million. In 2023 dollars, that would equal $464 million. But the actual sum of all 2023 salaries above $175,000 was $1.8 billion (with a “B”)!
So, yes, tuition has doubled since 2006–07. And it seems that dramatic increases in high-end employment costs have been a significant driver. As the taxpayers paying for most of this, there’s a question that we must ask ourselves: has the epic growth in university employment delivered value to Ontario – and to all Canada – at a scale that justifies those costs? In other words, are the students now graduating from Canadian schools equipped to successfully enter a demanding job market, navigate a fractured political environment, and strengthen weakened communities? Recent scenes from campus protests suggest that might not be the case.
David Clinton is the publisher of The Audit (www.theaudit.ca), a journal of data-driven policy analysis. He is also the author of books on data tools, cloud and Linux administration, and IT security.
From the Frontier Centre for Public Policy
By Lee Harding
Ottawa’s Major Projects Office is a fix for a mess the Liberals created—where approval now hinges on politics, not merit.
They are repeating their same old tricks, dressing up political favouritism as progress instead of cutting barriers for everyone
On Sept. 11, the Prime Minister’s Office announced five projects being examined by its Major Projects Office, all with the potential to be fast-tracked for approval and to get financial help. However, no one should get too excited. This is only a bad effort at fixing what government wrecked.
During the Trudeau years, and since, the Liberals have created a regulatory environment so daunting that companies need a trump card to get anything done. That’s why the Major Projects Office (MPO) exists.
“The MPO will work to fast-track nation-building projects by streamlining regulatory assessment and approvals and helping to structure financing, in close partnership with provinces, territories, Indigenous Peoples and private investors,” explains a government press release.
Canadians must not be fooled. A better solution would be to create a regulatory and tax environment where these projects can meet market demand through private investment. We don’t have that in Canada, which is why money has fled the country and our GDP growth per capita is near zero.
Instead of this less politicized and more even-handed approach, the Liberals have found a way to make their cabinet the only gatekeepers able to usher someone past the impossible process they created. Then, having done so, they can brag about what “they” got done.
The Fraser Institute has called out this system for its potential to incentivize bribes and kickbacks. The Liberals have such a track record of handing out projects and even judicial positions to their friends that such scenarios become easier to believe. Innumerable business groups will be kissing up to the Liberals just to get anything major done.
The government has created the need for more of itself, and it is following up in every way it can. Already, the federal government has set up offices across Canada for people to apply for such projects. Really? Anyone with enough dollars to pursue a major project can fly to Ottawa to make their pitch.
No, this is as much about the show as it is about results—and probably much more. It is all too reminiscent of another big-sounding, mostly ineffective program the Liberal government rolled out in 2017. They announced a $950-million Innovation Superclusters Initiative “designed to help strengthen Canada’s most promising clusters … while positioning Canadian firms for global leadership.”
That program allowed any company in the world to participate, with winners getting matching dollars from taxpayers for their proposals. (But all for the good of Canada, we were told.) More than 50 applications were made for these sweepstakes, which included more than 1,000 businesses and 350 other participants. In Trudeau Liberal fashion, every applicant had to articulate how their proposal would increase female jobs and leadership and encourage diversity in the long term.
The entire process was like one big Dragon’s Den series. The Liberals trotted out a list of contestants full of nice-sounding possibilities, with maximum hype and minimal reality. Late in the process, Minister of Innovation, Science and Industry Navdeep Bains picked the nine finalists himself (all based in cities with a Liberal MP), from which five would be chosen.
The alleged premise was to leverage local and regional commercial clusters, but that soon proved ridiculous. The “Clean, Low-energy, Effective and Remediated Supercluster” purported to power clean growth in mining in Ontario, Quebec and Vancouver. Not to be outdone, the “Mobility Systems and Technologies for the 21st Century Supercluster” included all three of these locations, plus Atlantic Canada. They were only clustered by their tendency to vote Liberal.
Today, the MPO repeats this virtue-signalling, politicking, drawn-out, tax-dollar-spending drama. The Red Chris Mine expansion in northwest British Columbia is one of the proposals under consideration. It would be done in conjunction with the Indigenous Tahltan Nation and is supposed to reduce greenhouse gas emissions by 70 per cent. That’s right up the Liberal alley.
Meanwhile, the project is somehow part of a proposed Northwest Critical Conservation Corridor that would cordon off an area the size of Greece from development. Is this economic growth or economic prohibition? This approach is more like the United Nations’ Agenda 2030 than it is nation-building. And it is more like the World Economic Forum’s “stakeholder capitalism” approach than it is free enterprise.
At least there are two gems among the five proposals. One is to expand capacity at the Port of Montreal, and another is to expand the Canada LNG facility in Kitimat, B.C. Both have a market case and clear economic benefits.
Even here, Canadians must ask themselves, why must the government use a bulldozer to get past the red tape it created? Why not cut the tape for everyone? The Liberals deserve little credit for knocking down a door they barred themselves.
Lee Harding is a research fellow for the Frontier Centre for Public Policy.
Ottawa held a full-blown press conference to announce they unclogged a pipe in Toronto and called it a generational housing strategy.
You probably didn’t hear much about it unless you were watching Canadian state media but this morning, the Liberal government held a press conference in Toronto. It was billed as a “generational investment” in housing. That’s the phrase they used. In reality, it was a sewer project.
Gregor Robertson, the former mayor of Vancouver and now the federal minister of housing and infrastructure, stood beside Toronto Mayor Olivia Chow and a cluster of Liberal MPs to announce that Ottawa is spending $283 million to upgrade the Black Creek trunk sewer line. That’s a pipe. A very old pipe. And according to Robertson, that investment will “unlock” the construction of up to 63,000 new homes in the Downsview area.
If that sounds suspiciously like taking credit for doing your job, maintaining the basic infrastructure cities rely on, that’s because it is. No one has ever accused the Liberals of missing an opportunity to repackage civic maintenance as a national moral crusade. The sewer line is 65 years old. It overflows during storms. It’s been a known problem for decades. Fixing it is not bold housing policy. It’s plumbing.
But the political optics are irresistible. The Trudeau Liberals, now under the leadership of Mark Carney are desperate for a win on housing. Their record is catastrophic. Home prices have doubled. Rents have soared. Entire generations of Canadians have been priced out of ownership and locked into permanent renter status. And the architects of that disaster are now flying around the country handing out ribbon-cutting ceremonies and calling it reform.
Today’s announcement also included the unveiling of the first project under a brand-new federal housing agency, Build Canada Homes. Never heard of it? That’s because it didn’t exist until a few weeks ago. And who’s running it? None other than Ana Bailão a Liberal operative and former Toronto city councillor who spent years helping make the city unaffordable in the first place. Now she’s being rewarded with a cushy federal appointment, tasked with building modular housing and handing out contracts on public land.
And what exactly is Build Canada Homes building? Today, they’re launching 540 homes. Not 63,000… 540. Factory-built units that will be delivered at some undefined point in the future. That’s the big federal breakthrough. A housing crisis affecting millions of Canadians, and Ottawa’s answer is five hundred and forty modular homes in Downsview.
This is the pattern every time. The government breaks something, calls it a crisis, and then demands credit for fixing a fraction of it with your money. The numbers are staggering. According to the Parliamentary Budget Office, Canada needs 3.1 million more homes by 2030 to restore affordability. That means building over 430,000 units per year. Right now, we’re building maybe half that. The backlog gets worse every year. But today, we’re supposed to celebrate because they’re unclogging a sewer and firing up a couple prefab builds on federal land.
No one in the press asked the obvious question: why aren’t private builders constructing the 300,000 units that Toronto has already zoned and approved? Because they can’t. The financing doesn’t work. The cost of materials is too high. Interest rates have crippled developers. And cities like Toronto still impose hundreds of millions of dollars in fees, development charges, and bureaucratic red tape. That’s the real bottleneck. Not the sewer. And here’s what they definitely won’t say out loud: Canada’s housing disaster is not just about supply. It’s about demand, turbocharged by one of the fastest immigration intakes in the Western world. The Bank of Canada has warned repeatedly that immigration targets, set without any link to housing capacity — have blown demand wide open and put relentless upward pressure on rents and home prices.
Mayor Chow admitted it herself, sort of. She said the city has thousands of units ready to build but no takers. And instead of confronting the root causes, monetary policy, taxes, regulatory insanity, the government announces a pilot project and tells you to be grateful. That’s how disconnected they are from reality. They’ve regulated housing out of reach and now they’re posing for photos on a construction site, pretending to be the solution.
And just in case there was any lingering doubt about how deep this failure runs, Statistics Canada released its latest building permit numbers this morning and the trend is exactly what you’d expect in a country where the government makes building homes all but impossible.
The total value of building permits dropped again in August down $139 million to $11.6 billion. Residential permits alone fell 2.4%, driven by steep declines in Ontario and Alberta, the very provinces with the most acute housing needs. Single-family permits fell off a cliff — down more than 10% year-over-year. That’s not a slowdown. That’s a stall.
Meanwhile, British Columbia and Quebec where government intervention is particularly heavy barely managed to offset the damage. The number of new dwellings authorized actually shrank month over month. And this is happening in the middle of a so-called national housing push.
StatsCan didn’t sugarcoat it. They didn’t blame foreign investors or greedy landlords or some phantom market force. They just showed the raw data: Permits are falling. Housing starts are lagging. Builders are retreating.
So let’s just pause here and appreciate the sheer absurdity of what we witnessed. A parade of officials, flanked by branded podiums and tax-funded media handlers, standing in front of a construction site to announce, with straight faces, that they are upgrading a sewer line. And for this, we are told we are “building Canada strong.” Really? That’s the pitch? Fixing basic municipal plumbing is now a nation-building moment?
No! Let’s be clear, you’re not building Canada strong. You’re doing your job. A sewer upgrade in Toronto is not some heroic act of visionary leadership. It’s literally maintenance. It’s what functioning governments are supposed to do, quietly, competently, without a six-camera press choreography and a round of applause from party MPs.
But in Liberal Carney Canada the bar has been lowered so dramatically that simply clearing a permit backlog and patching old infrastructure is treated like a moon landing. They break the system, congratulate themselves for patching one pipe, and expect gratitude.
If you want praise for fixing aging civic infrastructure, something cities used to handle without a national press event, then that tells us everything. It tells us the Liberal government has become so hollow, so addicted to performance politics, that maintenance is now treated as achievement. That’s how far we’ve fallen in just ten years.
They didn’t rebuild a nation. They didn’t launch a housing renaissance. They unclogged a sewer, and are now demanded a standing ovation. And that, in a single image, is modern Liberal Canada: the total collapse of standards, repackaged as progress and sold back to you at full price.
Canadians don’t need more press conferences. They need homes, dignity, and a government that works without constant applause. And if unclogging a pipe is what passes for leadership now — then God help the country.
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