How is HEPI calculated?
From 1961-2001, HEPI was based on the price data for 25 budget components organized into eight categories – more than 100 items in all. From fiscal year 2002 on, HEPI has been calculated using a regression formula. The regression-based index values are essentially equal to those resulting from complete data. The R-squared value for the regression is .999997809. Regression-calculated HEPI values are not likely to vary from fully compiled values by more than 0.1 parts out of 200.0 or ± 0.05%.
Beginning in 2009, the estimates and the final HEPI calculation were calculated using data series that were entirely aligned with the July-June academic fiscal year. Prior to that, the index had been calculated using data drawn from data series with various monthly endpoints. The resulting timing differences in the underlying data had sometimes led HEPI to seem too high or too low relative to the Consumer Price Index (CPI).
Adoption of the improved methodology led to a restatement of HEPI for the period 2002-2008.
What are the main components of HEPI?
The item categories are:
- professional salaries and fringe benefits of faculty, administrators and other professional service personnel;
- non-professional wages, salaries and fringe benefits for clerical, technical, service and other non-professional personnel;
- contracted services such as data processing, communication, transportation, supplies and materials, and equipment;
- library acquisitions; and
These represent the major items purchased for current operations by colleges and universities.
Prices for these items are obtained from salary surveys conducted by the American Association of University Professors, the College and University Personnel Association, and the U.S. Department of Labor’s Bureau of Labor Statistics; and from price series for components of the Consumer Price Index (CPI) and the Producer Price Index (PPI) published by the Bureau of Labor Statistics.
The eight components employed represent 79.6 percent of the HEPI's total component weight in 1990.
HEPI and major component values are reported for fiscal years 1961 through the latest completed fiscal year. Consumer Price Index (CPI) values are also reported for the same time period for comparison purposes.
The data, information, opinions and estimates contained in the HEPI are provided for informational purposes only. As such, they may be incomplete or condensed, constitute judgments as of their date and are subject to change without notice. Such data, information, opinions and estimates are furnished as part of a general service, free of charge and without regard to the particular circumstances of any person or institution, and The Common Fund for Nonprofit Organizations shall not be liable for any damages stemming from their use or in any other connection therewith.