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2018 HEPI Report Released

December 10, 2018  | by Commonfund Institute

Industry Knowledge

Inflation for U.S. Higher Education Institutions Rises 2.8% in Fiscal 2018

WILTON, CT, December 10, 2018 – Data from the annual Commonfund Higher Education Price Index (HEPI) show that inflation for U.S. colleges and universities rose 2.8 percent in fiscal year 2018, a decline from last fiscal year’s 3.31 percent rate but higher than the average of 2.4 percent for the preceding five fiscal years. Of the past 10 years, FY2018 HEPI was the third highest rate of inflation, trailing only FY2017 and FY2014. (Fiscal year 2018 covers the period from July 1, 2017, to June 30, 2018, and coincides with the budget year of most institutions of higher education.)

FY2018 costs rose in all eight components tracked by HEPI compared with last year when costs rose in seven of the eight. Differentiating this year from last, in FY2018 no single cost rose as much as 2017’s 14.5 percent increase in utility costs and 4.1 percent in fringe benefits; instead, cost increases this year were in a tighter range of 1.7 percent (for utilities) to 3.4 percent (for service employee costs).

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[1] In 2015, the American Association of University Professors (AAUP) began using a new methodology that was not directly comparable with the past; therefore, data on faculty salaries and fringe benefits, as well as information by region and type of institution, was excluded from the 2016 and 2017 HEPI reports. The conversion has been completed and the 2018 report once again includes these data points. We have used what we believe are reasonable estimates for changes in these two components. Additionally, due to the modification mentioned above, last year’s FY2017 HEPI number has been restated to 3.3 percent.

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