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Quality in Higher Education
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Where did all the money go? Funding, personnel
and expenditure in Swedish universities and
colleges 2001–21
Olof Hallonsten
To cite this article: Olof Hallonsten (2022): Where did all the money go? Funding, personnel
and expenditure in Swedish universities and colleges 2001–21, Quality in Higher Education, DOI:
10.1080/13538322.2022.2121469
To link to this article: https://doi.org/10.1080/13538322.2022.2121469
© 2022 The Author(s). Published by Informa
UK Limited, trading as Taylor & Francis
Group.
Published online: 19 Oct 2022.
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Where did all the money go? Funding, personnel and
expenditure in Swedish universities and colleges
2001–21
Olof Hallonsten
School of Economics and Management, Lund University, Lund, Sweden
ABSTRACT
Swedish universities and colleges have received a substan-
tial funding increase since the turn of the millennium, as
part of continued policies of expanding the admission of
students to higher education to broader layers of the popu-
lation and strengthen Swedish public research and devel-
opment to increase the competitiveness of the Swedish
knowledge-based economy. In this article, publicly available
statistics are used to trace how this increase in funding has
been used by the sector. Comparing figures on income
(base grant for research, third-party funding and base grant
for education) with statistics on personnel and student
enrolment as well as data on actual expenditure, the article
draws some conclusions that are used to discuss some
common misunderstandings and erroneous beliefs, includ-
ing claims of a ‘depletion’of the base grant for research
and an uninhibited growth of the number of administrative
staff, which are common themes in the Swedish and inter-
national debate over higher education.
KEYWORDS
Funding, research, growth,
administration,
universities, Sweden
Introduction
The Swedish university system has grown dramatically in the past two deca-
des. Both student and staff numbers have risen by more than 30% and the
overall income has grown by almost 70% (adjusted for inflation). Proper ana-
lysis of the system-level consequences of this expansion is likely to add
important nuance to some controversial debates, including the popular
assumptions that the base grant funding for research is in long-term decline
in favour of third-party funding in Sweden, that the cadres of administrators
at Swedish universities are growing unceasingly at the expense of the teach-
ing and research staff and that temporary employments are more common
CONTACT Olof Hallonsten Olof.Hallonsten@fek.lu.se
ß2022 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group.
This is an Open Access article distributed under the terms of the Creative Commons Attribution-NonCommercial-
NoDerivatives License (http://creativecommons.org/licenses/by-nc-nd/4.0/), which permits non-commercial re-use,
distribution, and reproduction in any medium, provided the original work is properly cited, and is not altered, transformed,
or built upon in any way.
QUALITY IN HIGHER EDUCATION
https://doi.org/10.1080/13538322.2022.2121469
and permanent (tenured) positions are in decline. Similar claims are also
often heard internationally and are usually uttered as part of broader
debates over alleged economisation, marketisation, bureaucratisation and
managerialist reform of universities, as well as system-wide stratification and
resource concentration to
elite institutions and pressing and conflicting
demands on universities to be engines of growth in the globalised know-
ledge economy (Engwall & Nybom, 2007; Teelken, 2012; Hallonsten &
Silander, 2012; Rider et al.,2013;Eket al.,2013; Stensaker & Benner, 2013;
Holmberg & Hallonsten, 2015; Alvesson & Spicer, 2016; Karlsson & Ryttberg,
2016; Silander & Haake, 2017; Ekman et al.,2018).
Are such claims really true? Did the resource increase in the Swedish univer-
sity system fund the expansion of the ‘all-administrative university’(Ginsberg,
2012) or was it all allocated in the form of temporary competitive grants, with
strings attached, thus undermining academic integrity and long-term quality of
teaching and research? The purpose of this article is to add some (comparably)
hard facts to these debates and thus attempt to dispose of some beliefs as
myths or misconceptions. This is done with system-wide, publicly available fig-
ures on income (base grant for research, third-party funding and base grant
for education), statistics on personnel and student enrolment, data on actual
expenditure and historical data on salary levels. Conclusions therefore remain
on the overall level but nonetheless show some irrefutable patterns. Most of
the money went to hiring more permanent teaching and research staff,
increasing their salaries and recruiting more students. Administrative staff cer-
tainly increased in numbers but not as much as often claimed. Moreover, while
third-party funding increased its relative share of university income for
research, the governmental base grant for research also grew substantially.
The next section contains a brief historical background to the structure
and condition of the Swedish academic system, based on secondary sources.
Thereafter, some notes are made on method and the data used in the ana-
lysis, followed by a straightforward presentation of the data used. In the
second half of the article, the data is analysed and some key conclusions
drawn. On the basis of this, in the final section, the results and their explan-
ation are discussed in combination with a broader conceptual contextualisa-
tion and some suggestions for future research.
Background
Sweden has a historically strong research system by international compari-
son, with total annual R&D expenditures above 3% of GDP, which is the
highest in the European Union. The system is strongly dominated by the pri-
vate sector, whose share of the total annual research and development
(R&D) expenditures is around 70%, and the universities and colleges, whose
2 O. HALLONSTEN
share is roughly 25%. This is unusual in international comparison since
Sweden never built up any noticeable sector of governmental research insti-
tutes to complement universities on the R&D performer side (Hallonsten,
2018). Meanwhile, Swedish higher education has been expanded dramatically
in the past century, with more than 40% of each age cohort entering tertiary
education today. The current research and higher education system was
shaped by the astonishing economic growth in the post-World War II period
and the ambitious overall project of building a Swedish universal welfare
state and a democratic and egalitarian society, which placed great public
faith in the abilities of (higher) education, scientific research and techno-
logical development to improve society. Meanwhile, comparisons with other
countries and other policy areas yield that Sweden has limited centralisation
of authority and rather weak coordination between actors and processes in
the area of research policy (Benner & S€
orlin, 2007; Engwall & Nybom, 2007;
Holmberg & Hallonsten, 2015; Hallonsten, 2020, ch 4).
Before World War II, Sweden hardly had a national research or higher edu-
cation policy at all. But the post-war expansion of the Swedish welfare state
meant significant mobilisation in both academic research and higher educa-
tion, in order to supply Swedish industry with a qualified labour force, to give
the working class access to higher education and to further progress built on
science and technology (Elzinga, 1993). Estimations are that the total number
of students enrolled in higher education in Sweden increased 30-fold
between 1940 and 2012, in a continuous growth with two especially signifi-
cant waves of expansion in the 1960s and 1990s (Holmberg & Hallonsten,
2015). With time, this expansion necessitated the founding of new universities
and colleges, with the 1977 reform bringing the largest number of new
organisations to the mix, as previous vocational schools and branch campuses
of the universities were converted into regional colleges without university
status. This reform also made Swedish higher education a uniform system
with central authority (although the old universities mostly kept their privi-
leges (Askling, 1989)) and separated the governmental base grants for educa-
tion and research. The latter allegedly weakened the links between education
and research and, in the decades to come, the system evolved and diversified
further (Holmberg & Hallonsten, 2015). The six old and full-breadth univer-
sities are today complemented by six specialised (medical, technical, agricul-
tural) colleges with university status, five comparably small and regional
universities and eleven regional colleges without university privileges.
Today, therefore, the landscape of higher education in Sweden is essen-
tially a two-tier system of the type common in many European countries,
with a smaller number of old universities and an additional group of voca-
tional colleges turned regional colleges (Askling, 1989;Sk
€
oldberg, 1991;
Kyvik, 2004; Holmberg & Hallonsten, 2015). The privileges of the twelve old
QUALITY IN HIGHER EDUCATION 3
universities and specialised schools with university status are seen especially
in research, where they absorb 90% of the total available funding (both base
grant and third-party funding), with the sixteen colleges and newly created
universities sharing the rest. In education, the pattern is less clear, as the
twelve first-tier universities enrol 58% of the students (autumn term of 2019).
Until the 1990s, there was very little governmental initiative and strategic
prioritisation in the funding for research in Swedish universities. Resource
allocation was still done mostly on basis of tradition, with power residing
with the university faculties and the chairholder professors, and little or no
room for central university management to make any priorities of their own.
Third-party funding from the research councils and private foundations was
mostly allocated through grants awarded to applicants in open calls within
classic subject areas (natural science, medicine, humanities, social science)
(Engwall & Nybom, 2007; Holmberg & Hallonsten, 2015).
The 1990s saw several important changes. From 1991 to 1994, five public
research foundations were created as a deliberate attempt to introduce
‘strategic’research funding and break previous path-dependencies in
research and make universities more ‘entrepreneurial’and internationally
competitive (Benner & S€
orlin, 2007). In 1993, a comprehensive university
reform decentralised decision-making and made part of the base grant for
education contingent upon throughput of students and strengthened the
regional colleges by giving them access to base grant funding for research
and the right to appoint professors (Engwall & Nybom, 2007; Holmberg &
Hallonsten, 2015). At the end of the decade, the opportunity was opened for
colleges to apply to the government for university status and, in 1999, three
regional colleges were upgraded to universities by decision of the govern-
ment, followed by an additional two in 2004 and 2016. In 2001, the research
councils were restructured in order to achieve better opportunities for stra-
tegic prioritisation and mobilisation in areas of particular importance and,
since then, the share of governmental funding channelled through the
research councils for specific purposes (including excellence funding, stra-
tegic funding and field-specific programmes) has increased dramatically,
mostly at the expense of the traditional project grant funding awarded
through open calls (Hallonsten, 2020, ch 4).
In international comparison, therefore, Swedish research policy is hetero-
geneous and weakly coordinated, with policy formulation delegated to sev-
eral authorities and resources spread over many areas. Occasionally, local
initiatives have managed to grow into internationally competitive positions,
with some support from specialised funding bodies and benign policymakers
and bureaucrats (Benner & Sandstr€
om, 2000; Gribbe & Hallonsten, 2017;
Hallonsten & Christensson, 2017) but the strength of the system has historic-
ally been able to maintain breadth. However, since the beginning of the
4 O. HALLONSTEN
2000s, policies have shifted and the government is now more clearly aiming
to mobilise strategically in specific areas of strength, so that Sweden can fur-
ther develop the competitiveness of is knowledge-based economy and meet
the growing challenges of globalisation. The result has been clear: first, there
is more central steering and strategic initiative on the level of the government
and its ministry for higher education and research (Hallonsten, 2020,ch4),
seen in general increases of the base grant for research to the universities and
the allocation to the research councils. Second, several billion SEK have been
earmarked to specific areas (mostly in medicine, engineering sciences and
research for sustainable development), competitive ‘excellence’funding
(Hallonsten & Silander, 2012) and efforts to stimulate more ‘collaboration’
between academia and broader society (Brostr€
om et al.,2019). The annual
increases of funding to Swedish universities and colleges has been unceasing
regardless of political majority in the Swedish parliament.
Although a 2010 reform to the governance of universities and colleges for-
mally took power over the distribution of resources between different scientific
areas, faculties and departments out of the hands of the government and gave
it to central university management, resources are still, to a great extent, distrib-
uted on the basis of tradition and path-dependence (Holmberg & Hallonsten,
2015). The base grant for research, by which is meant the unfettered funding
allocated to universities in the annual governmental budget, and doctoral edu-
cation, amounted to 21.1 billion SEK in total in 2021 and constituted 44.4% of
the total funding for research and doctoral education in Swedish universities
and colleges that year. Third-party grant funding amounted to 22.3 billion SEK
(46.9%). The remaining share, 4.1 billion SEK (or 8.7%), comprised of fees, finan-
cial income and income from commissioned research.
The landscape of third-party funders is broad and varied, with several
research councils, public and private foundations, non-council governmental
agencies with their own research funding activities and foreign and domestic
businesses and EU funding. The largest single funder is the Swedish
Research Council, with 22.9% of the total third-party funding in universities
and colleges, followed by the private Wallenberg foundations (8.8%) and the
EU framework programmes (5.9%). All universities and colleges in Sweden
are organised as governmental agencies, except three which are run as inde-
pendent foundations, but all 28 have the absolute most part of their funding
from the base grant for research (25.6% of their total income), third-party
funding for research (27.0%) and the base grant for education (35.3%).
Method and data
The data used in this article comes from three main sources. First, all data
on finances, personnel and students come from the statistics database of the
QUALITY IN HIGHER EDUCATION 5
Swedish Higher Education Authority. In the results and analysis sections below,
all data reported comes from this source unless otherwise stated. Second,
some financial data has also been extracted from the annual reports of the
Swedish publicly owned real estate company Akademiska Hus, which has a
majority share of the market for campus buildings at Swedish universities
and to which universities and colleges pay rents. Third, official salary statis-
tics for academics provided annually by the labour union the Swedish
Association for University Teachers and Researchers in their membership maga-
zine, have also been retrieved from the Lund University Library for the years
studied. There are gaps in this material, as personnel categories have
changed over the years, and the statistics only contain data on (some) teach-
ing and research staff. Complete time series of average salary levels of pro-
fessors and senior lecturers, the two key academic employment categories,
were however possible to obtain for the whole period studied. Average sal-
ary levels for doctoral students were possible to obtain from 2004 onwards.
In addition, some complementary data have been retrieved from the
Eurostat database and the public Swedish statistics agency Statistics Sweden.
The time period studied, 2001–21, was chosen on the basis of the avail-
ability of data, especially from the statistics database of the Swedish Higher
Education Authority, which contains major gaps for years before 2001. All
figures on income and expenditure of the universities were adjusted for
inflation and thus converted to 2021 prices. The numbers of registered stu-
dents are reported for semesters in the database used, which means that
the annual numbers reported below were obtained by calculating an aver-
age of the enrolment in the spring and fall semesters of each year.
Results
As already noted in the introduction, the total income of Swedish universities
increased from 48.9 billion SEK to 82.6 billion SEK, or 68.8%, between 2001
and 2021 (note, as a reminder, that these figures and all similar figures
below have been adjusted for inflation and are given in 2021 prices). This
can be compared with the overall productivity growth of the Swedish econ-
omy, which was 69.2% in the twenty years studied (also inflation-adjusted).
The growth of the total income of Swedish universities was rather even over
this period, with some hikes here and there, especially in the research fund-
ing, but with a steady growth only interrupted by a very minor decrease in
the overall funding in 2007 (0.5%), when the base grant for education fell
by 4%. Otherwise, all the three major income sources (base grant for educa-
tion, base grant for research and third-party research funding) increased in
all years, with few and minor exceptions.
6 O. HALLONSTEN
The base grant for research increased by 8.82 billion SEK, or 71.7%, in the
period studied. Meanwhile, third party funding for research increased by 11.2
billion SEK or 100.2%, which means that the share of base grant funding of
the total income for research fell from 46.7% to 44.4%. This was, however,
not a uniform development: between 2003 and 2008, the share increased as
third-party funding declined somewhat and in the years 2009–10 a major
general increase in research funding (see below) gave a 20.6% increase in
third-party funding in 2009 and a 12.8% increase in the base grant for
research in 2010, which makes the curve deviate from its overall path of
increased share of third-party funding for research in the universities.
The base grant for education likewise grew dramatically over the period,
by 11.7 billion SEK or 66.9%. The growth was most marked in the first years
of the millennium, with a growth of almost 20% in 2002 and almost 5% in
2003. The years thereafter were followed by small increases or small
decreases in 2004–08 (neither ever more than 4%), two years of clear growth
(8.3% and 6.5%, respectively, in 2009 and 2010) and then more or less only
minor oscillations around zero growth in the ten years thereafter. These
financial developments are summarised in Figure 1.
Looking at actual expenditure, the three largest items are personnel, rents
and other operating costs, which in total make up around 90% of the total
expenditure. The total personnel costs increased by 85.4% in 2001–21,
whereas the other two major expenditures, namely rents and other operating
costs, increased by 40.5% and 34.9%, respectively. The relative shares of
these cost categories did not fluctuate much in the period; other operating
costs oscillated between 14% and 18% of the total in the whole period,
whereas total personnel costs grew from 57.9% to 65.9% of the total and
Figure 1. Total income of Swedish universities and colleges, 2001–21, divided on major
income sources, billion SEK. Note that all numbers have been adjusted for inflation.
QUALITY IN HIGHER EDUCATION 7
costs for rents decreased its share of the total, from 14.3% in 2001 to 12.3%
in 2021.
Not surprisingly, given the growth in income and the growth of personnel
costs, the total number of employees (full-time equivalents, FTE) grew by 32%
between 2001 and 2021. For teaching and research personnel, the period brought
an even steeper growth, especially in the categories professors, senior lecturers,
so called ‘career development positions’(which includes postdocs and associate
lecturers) and other personnel with teaching and research duties (mainly
researchers and research assistants). Together, these categories of personnel
grew by 11,882.6 FTEs or 77%, and especially the career development positions
grew significantly (2644.5 FTE or 265.9%). The number of professors and senior
lecturers grew by 63.5% and 73.0% respectively, but other categories decreased
in numbers, namely lecturers without doctoral degree (1326.7 FTE or 20.5%)
and temporary teachers (paid with fees) (1012.5 FTE or 65.1%). The various
categories of administrative personnel experienced different types of changes.
The category administrative staff increased by 5038.1 FTE in the period, or 58.5%,
whereas library personnel decreased by 310.3 FTE or 21.5% and technical staff
decreased by 902.6 FTE or 11.9%.
In the same period, the salaries of professors and senior lecturers increased
by 32.4% and 29.5%, respectively, and in the years 2004–21, the salaries of
doctoral students increased by 22.6%. The number of registered students
increased significantly between 2001 and 2021, from 283,555.0 to 374,374.5,
or 32%, in a development that was not entirely even but varied somewhat,
largely following the fluctuations and overall growth of the base grant for
education (see above). There was significant growth in 2003–04, some
decline in 2005–08, another major growth in 2009–10 and, after that, a net
decrease of 8204.5 students in 2010–19 and a subsequent growth with over
30,000 registered students in the final two years of the period. The data pre-
sented in this section is summarised in Table 1.
Analysis
It was established as a starting point for this article that the Swedish aca-
demic sector grew dramatically in volume between 2001 and 2021, due to
significant increases of all three major sources of income, namely base grant
for research, third-party funding for research and base grant for education.
Comparing the data on the vast resource increase in the two decades
studied with the other indicators reported above renders important and
interesting inferences that can help answer the research question: where did
all the money go?
Concerning education, the base grant grew by over 11 billion SEK, or
66.9%, whereas student numbers grew by only 32%. This means, among
8 O. HALLONSTEN
other things, that the average cost (to the national education budget) per
student increased. In 2001, it was 78,201 SEK, whereas in 2021 it was 92,054
SEK (using a simple ratio of total education income divided by the total
number of enrolled students), an increase in the average cost per enrolled
student of 17.7%. The figures should of course only be used as very rough
estimates of a long-term trend, since there are significant fluctuations during
the time period studied, and not least also because the reported data do
not take into account differences between fields and levels of education
(basic and advanced). Nonetheless, there is an evident discrepancy between
the growth in the gross income for education and the growth in the number
of students enrolled. This discrepancy could, conceivably, be explained by an
increase in the quality rather than quantity of higher education overall in
Sweden, should a reliable measure of this be available. Which it is not, at
least not in the context of the present study.
Concerning research, it shall foremost be noted that the base grant for
research and the third-party funding for research have grown at different
rates, which has led to a slight tilt in the balance of research income in
favour of third-party funding. In 2001, the base grant for research made up
46.7% of the total income for research and in 2021, it was 44.4%. However,
this overall relative decline in base grant funding is minuscule in comparison
with the overall growth on all accounts, namely a near 70% resource
increase across the board. Moreover, since the base grant for research
increased even more than the overall income (71.7% compared to 68.8%),
this means that the research base grant’s share of the total income to the
universities and colleges increased somewhat in the period. Previous studies
suggest that the distribution of the increases of both base grant for research
and third-party funding for research across the system is strongly unequal
Table 1. Summary of the reported data
2001 2021 Change
Total income (billion SEK) 48.9 82.6 68.8%
Base grant for research (billion SEK) 12.3 21.1 71.7%
Third party funding for research (billion SEK) 11.1 22.3 100.2%
Base grant for education (billion SEK) 17.5 29.1 66.9%
Total expenditure (billion SEK) 49.2 80.3 63.0%
Personnel costs (billion SEK) 28.5 52.9 85.4%
Rents (billion SEK) 7.0 9.9 40.5%
Other operating costs (billion SEK) 8.7 11.8 34.9%
Total number of employees (FTE) 49,220.0 64,951.2 32.0%
Professors (FTE) 3268.8 5343.0 63.5%
Senior lecturers (FTE) 5715.3 9889.8 73.0%
Doctoral students (FTE) 8166.2 10,528.8 28.9%
Administrative personnel (FTE) 8610.7 13,648.8 58.5%
Average salary professor (SEK) 52,223.0 69,119.0 32.4%
Average salary senior lecturer (SEK) 39,073.0 50,585.0 29.5%
Number of registered students (FTE) 283,555.0 374,374.5 32.0%
Swedish GDP (billion SEK) 32,225.0 54,570.0 69.2%
Note that all numbers have been adjusted for inflation.
QUALITY IN HIGHER EDUCATION 9
and favours the larger and older universities (Stensaker & Benner, 2013;
Holmberg & Hallonsten, 2015) but follow-up analyses on this level of detail
will have to commence to bring clarity to these issues.
It is interesting to note that the most accentuated growth pattern in the
expenditure of the universities and colleges in the period studied is in person-
nel costs, which grew by 85.4% in 2001–21 and thus increased its share of
the total expenditure from 57.9% to 65.9%. Costs for rents also grew (by
40.5%) but decreased its share of the total, from 14.3% to 12.3%, as dis-
cussed further below.
The growth in personnel costs has several possible explanations.
First, the overall personnel numbers increased by 32.0% in the period,
which is significantly lower than the overall growth in funding (68.8%) and
the overall growth in personnel costs (85.4%). This means that counting all
personnel categories, the average cost of an FTE university employee was
significantly higher in 2021 than 2001, namely 815 kSEK compared to 579
kSEK, a 40.5% increase. For comparison, taken together, rent costs and other
operating costs per FTE university employee increased by only 4.1%.
As noted above, different personnel categories increased and decreased
quite significantly in number in these years. The FTE of all teaching and
research personnel (not including doctoral students) increased by 40.7% and
FTE doctoral students by 28.9%. Meanwhile, FTEs of administrative, technical
and library personnel together increased by 21.7% and the number of FTE
administrative staff separately increased by 58.5%. It is likely that those cate-
gories of academic staff that increased in number, namely professors, senior
lecturers, career development positions, and ‘other teaching and research
personnel’, are more costly than those categories that decreased in number,
namely lecturers without doctoral degree and temporary teaching staff,
which could account for some of the increased personnel costs overall.
Another factor for this development could be the significant increase in the
salaries of professors and senior lecturers, 32.4% and 29.5% respectively, as
shown in the annual statistics provided by the labour union the Swedish
Association for University Teachers and Researchers, in their membership
magazine. The increase in number of FTE doctoral students (28.9%) is per-
haps of minor importance in explaining the increased personnel costs but
their increased salary level (2004–21), by 22.6%, is likely more consequential.
In the categories of non-academic staff, no similar conclusions can be drawn,
as there is no obvious causal link between on one hand the growth in
administrative staff and decrease of library and technical staff, and the seem-
ing growth in cost of personnel; moreover, data on the salary increases of
these employee categories is not available.
Three things in the material seem to suggest that the overall resource
increase in the years 2001–21 most of all has financed academic positions:
10 O. HALLONSTEN
first, the growth of personnel costs as share of total expenditure; second, the
increase in numbers of professors, senior lecturers and doctoral students;
and third, the increased salary levels of all three categories. In connection
therewith, it is interesting to note that while the category of administrative
staff has grown by 5038.1 FTE or 58.5% in the period studied, the numbers
of library staff and technical staff have decreased (by 310.3 and 902.6 FTE, or
21.5% and 11.9%, respectively), which means that the net growth of non-
teaching and non-research personnel in the period was only 21.7%.
Of particular interest is also the costs for rents. This expenditure increased
by 40.5% in 2001–21, which is significantly less than the increase in person-
nel costs, which also means that rents as share of total expenditure
decreased from 14.3% in 2001 to 12.3% in 2021. A majority of the buildings
occupied by universities and colleges in Sweden are owned by the state
through its real estate company Akademiska Hus. The annual reports of this
company reveals that its market share of university and college buildings in
Sweden was 66.5% in 2021 (calculated as the ratio between its total gross
rent incomes and the total rent expenditures of the universities and col-
leges). As a governmentally owned company, Akademiska Hus is obliged to
pay annual dividends to the government. Over the years 2001–21, these divi-
dends averaged 1.5 billion SEK per year, which constitutes an average of
2.3% of the annual total turnover of the universities and colleges. Although
a minor sum in this context, it is worth noting that this arrangement means
that the government every year takes back a few per cent of its funding to
the universities and colleges through its real estate company. This share has
increased in the years studied, from 0.5% in 2001 to 2.7% in 2021, with one
especially exceptional year, namely 2015, when no less than 11.9% of the
total turnover of the universities and colleges was channelled back to the
governmental budget through a shareholder’s dividend of 8.7 billion SEK (in
2021 prices).
Where the money went
The starting point for the analysis in this article was the simple identification
of a significant increase in the total funding for Swedish higher education
and academic research in the past two decades. It is in itself remarkable. To
reiterate; the base grants for research and education have both increased by
around 70% and the total third-party funding has more than doubled. The
first major task of the discussion and conclusions of this article will therefore
have to be to explain, on the basis of available historical evidence and con-
ceptual tools from the Swedish and international study of academia, why
this happened. Similar explanations of the other findings of the article will
QUALITY IN HIGHER EDUCATION 11
then follow and hopefully put the findings in proper perspective and secure
their relevance for a broader audience.
The major resource increase most likely has a multitude of causes. Leaving
the purely political causes aside for a brief moment, it is interesting to note
that funding increases of the sort reported in this article have, in a sense,
been predicted by scholars studying other university systems, in other time
periods, and making general inferences on the nature of university teaching
and research as economic activities. Studies have, for example, suggested
that university teaching and research have neither the means, nor the incen-
tives, to increase efficiency in the way that the production and service indus-
tries do and therefore normally cannot be expected to share in the
productivity gains of the rest of the economy (Bowen, 1967; Ehrenberg,
2002). Expansion of universities, allegedly imperative in their organisational
logic (Greenberg, 2007), and salary raises, expected by university employees
and demanded by their labour unions, need therefore be paid by increased
income. Elsewhere, most conspicuously in the United States, tuition fees are
therefore growing at a significantly higher rate than consumer prices,
whereas in Sweden, as has been shown, the governmental base grants (and
third-party funding) have grown dramatically. In Sweden, the overall growth
in income of the universities in 2001–21 (68.8%), is on par with the overall
GDP growth in the same period (69.2%), which confirms this thesis. The
resource allocation system has, in a sense, adjusted to the productivity
growth in the broader economy and expanded teaching and research in the
universities accordingly.
This has, most of all, been accomplished by political initiative. The review
of the research policy developments in the background section above
pointed at a general shift in governmental research policy around the turn
of the millennium, that upgraded research (and, to some extent, higher edu-
cation) to a new and strengthened role in the long-term securing of the
international competitiveness of the Swedish economy. Due both to global-
isation and increased competition from abroad, and the increasing influence
of ‘knowledge economy’discourse and adjoining theories of the role of
knowledge and technology for economic competitiveness, the shift is seen
rather clearly in the language of the four consecutive Swedish governmental
research policy bills of 2000, 2005, 2009 and 2012, which all, with increasing
intensity, emphasised the need for strategic mobilisation in research, both
across the board and in specific areas of highest priority. Here, the govern-
ment turned political rhetoric into substantial reinforcements. The excellence
funding initiatives from 2009 and on meant general increases of both base
grant funding and competitive funding (through the research councils) and
seem also to have created a precedent where every government wants to
make a mark and launch their own ‘strategic’funding programmes, be it
12 O. HALLONSTEN
centres of excellence (Hallonsten & Silander, 2012) or the cultivation of exter-
nal relations (Brostr€
om et al.,2019); regardless of their specific foci, funding
has increased as a result of these policies. It has also been argued that the
‘excellence’funding rhetoric has spread among the actors in the very plural-
ist and heterogeneous landscape of Swedish research funding bodies and
produced isomorphic change (Hallonsten & Hugander, 2014) that has per-
haps contributed to the overall growth in funding. On the education side,
the political ambition of expansion of higher education in Sweden seems to
have remained vivid well into the twenty-first century, which probably
explains some of the continued growth of the base grant for education. In
addition, the expansion of the system as such, especially the upgrades of
two colleges to universities in the time period studied, can probably also
account for some of the growth.
It is popular to make claims that the financial situation for Swedish univer-
sities has worsened in recent decades, although such claims seldom pass
peer review and reach publications and therefore are hard to point at in
proper citations. The reasons are, given the above, quite obvious. We have
no data about the alleged depletion of resources in the 1980s and 1990s
which is said to have led to a ‘sharp reduction in research funding provided
directly to the universities by the State’(Engwall & Nybom, 2007, p. 41).
However, on the basis of the data analysed in this article, it can be con-
cluded that in the two most recent decades, any such development has
been squarely reversed. It is of course true that ‘competitive funding
schemes gradually have gained popularity at the expense of institutional
block grants’in Sweden (Silander & Haake, 2017, p. 2010), although only if
adding that the ‘institutional block grants’(by which is meant the same as
base grant for research in this article) have decreased slightly in relative terms
but increased dramatically in absolute terms. It is hard to judge whether the
block grants are indeed ‘modest’in Sweden (Håkansta & Jacob, 2016, p. 6),
since this depends on the frame of reference. If the comparison is between
2021 and 2001, the base grant funding for research in Swedish universities
and colleges is far from modest today.
However, this statement is of course only true on the very general level
and taking into account no additional considerations. The alleged depletion
of base grant funding for research might be possible to prove with qualita-
tive investigations of the internal governance structures at universities and
colleges, unrealistic demands on them, and the suggestions that base grant
funding is used for a lot of things that isn’t curiosity-driven or free research
but rather education, administration and co-financing of research grants for
specifically defined purposes (Marton, 2005; Granberg & Jacobsson, 2006;
Håkansta & Jacob, 2016). Likewise, comparisons between universities and col-
leges seem to suggest a very uneven distribution of funds between them
QUALITY IN HIGHER EDUCATION 13
(Holmberg & Hallonsten, 2015) and comparisons between different fields
may yield similar results that could warrant the conclusion that in some
fields, base grant funding has indeed been shrinking. There is also a point to
be made regarding the practical consequences of ‘excellence’funding to
specific areas or with other strings attached, such as building external rela-
tions, mobilising in certain cross-disciplinary areas, or supporting promising
early-career researchers. Such conditioned funding may increase overhead
costs and thus contribute to a relative depletion of general funding for
research (or education), although ‘depletion’is arguably too strong a word
to use in this article altogether, given that it demonstrates a long-term, over-
all growth of funding across the board.
Future research should preferably look into these and other additional
angles on the topic, such as internal use of funding at the universities and
colleges, salary levels of administrators, changes in services provided by the
support functions in universities and colleges due to the decrease in the
number of library and technical personnel, possible increases in overhead
costs due to earmarked funding and not least qualitative investigations of
the often discussed tendency of teachers and researchers at universities
spending more time on administration and grant applications and less on
actual teaching and research.
Here, it suffices to conclude that while it is clear that the relative share of
base grant funding for research has decreased in the past two decades, in
favour of a larger share of competitive funding, both have increased dramat-
ically (albeit unequally) in real terms. As already noted several times, the
71.7% increase of the base grant for research is difficult, to say the least, to
interpret as a depletion or anything similar. Similarly, the increase of the
base grant for education, of 66.9%, should be viewed in appropriately posi-
tive terms, perhaps especially also given the slightly more modest increase
in the total number of students during this period, which means that the
available money per student has grown considerably.
Another popular notion today, in Sweden and abroad, is that academia is
being taken over by administrators. Looking only at the net growth in the
number of administrative staff in Swedish universities and colleges, which
was close to 60% in the time period studied, it might be possible to confirm
this suspicion. Classical works in the social sciences have argued that grow-
ing administration is an almost unstoppable force of modern organisational
life (Weber [1905], 2003; Parkinson 1957; Habermas 1984) and more recent
sociological analyses have claimed that current society indeed experiences
the ‘era of total bureaucratisation’that not only has to do with the expan-
sion of the public sector of the economy but also ‘the iron law of liberalism’,
namely that any governmental initiative to reduce red tape and promote
market forces will unavoidably lead to an increase in the total number of
14 O. HALLONSTEN
regulations and an increase in the total number of administrative staff
(bureaucrats) to maintain them and secure compliance (Graeber, 2015, pp.
9–18). This would perhaps also provide an explanation as to why it seems
the numbers of administrative staff at universities and colleges in Sweden
have grown uninterruptedly regardless of the ruling policy doctrine (regula-
tion or deregulation) and regardless of the parties in power. Specifically con-
cerning universities, the claims of growing administrative control have been
a topic of debate at least since the 1990s (Readings, 1996; Magala, 2009;
Ginsberg, 2012; Collini, 2012; Alvesson & Spicer, 2016; Graeber, 2018) and
there are many explanations available for why this development has
occurred. Readings (1996, p. 8) pointed to the influence of the French-
American historian Jacques Barzun in the late 1960s, who called for univer-
sities to build up an administrative capacity, populated by non-academic
bureaucrats, to exercise proper civil service authority and thus keep the
organisations and their operations in check (Barzun, 1969). A parallel and
perhaps not unrelated process is connected to globalisation, which took off
for real in the 1990s and created what several analysts have identified as an
international market of students, researchers and funding (Altbach & McGill
Peterson, 2007; Wildavsky, 2010), in whose traces a major international and
local effort of evaluation and rankings has been built up (Hazelkorn, 2011;
Hallonsten, 2021), sufficiently administratively demanding to warrant the
claim that this has created a ‘Frankenstein monster’of evaluation (Martin,
2011). Needless to say, this development should be visible in the changes in
volume of university administrations, along with the rise of managerialism
and economisation of higher education and academic research demonstrated
in other recent works (Berman, 2012;M
€
unch, 2014). Put differently, the new
role of universities as ‘strategic actors’in today’s society and economy
(Kr€
ucken & Meier, 2006) seems to have transformed the role of the university
administrator, from being a performer of pure support functions to vast stra-
tegic and managerial responsibilities. Although this development has been
seen as a threat to the collegial governance of universities, it is not necessar-
ily so that its most evident or important manifestation is in (growing) num-
bers of administrators but perhaps instead the qualitative change in their
responsibilities and role (Karlsson & Ryttberg, 2016).
As the data and analysis in this article shows, the picture is in need of
some nuancing and deeper study beyond pure numbers and sweeping
claims. The growth in administrative staff at Swedish universities and col-
leges has been significant in the past two decades but in comparison with
the vast net growth in FTE academic positions (professors, senior lecturers,
doctoral students, career development positions, other teaching and research
personnel), the growth is not so overwhelming. Both categories of tenured
staff (professors and senior lecturers) have grown at higher rates than
QUALITY IN HIGHER EDUCATION 15
administrators and so at least in pure numbers it is possible to refute the
claims that universities are taken over by administrators at the expenses of
academic staff. Although these claims are often backed by numbers that
show that in some universities in the United States and the United Kingdom
administrative staff even nowadays outnumber teachers and researchers
(Ginsberg, 2012; Alvesson & Spicer, 2016), there has so far been no real evi-
dence, aside from the autoethnographic and anecdotal, to support the
claims in the Swedish case. Up to now: as the numbers show, professors and
senior lecturers make up 23.5% of the total FTE workforce of Swedish univer-
sities and colleges in 2021 (a larger share than 2001, when it was 18.3%) and
administrative staff 21.0% (compared to 17.5% in 2001).
Needless to say, the numbers prove nothing about the actual power rela-
tionships inside the organisations of universities and colleges but merely
report on the relative sizes of personnel categories. As with all statistics, there
are most likely errors and hidden features. Issues naturally not covered by the
analysis in this article, but nonetheless very suitable for further research, is
possible shifts in the overall workload of academics, academic leaders and
other staff at universities. It has, for example, been claimed that academics
nowadays do more administrative work (Alvesson & Spicer, 2016, p. 35); this
assumption should be tested. The role of the administrator has been analysed
in depth and with specific attention to the Swedish case (Karlsson & Ryttberg,
2016); further similar studies would be very useful. Another topic that requires
qualitative analysis of some depth is the correlation and possible causal rela-
tionships between the growth of administrative staff and the parallel decrease
in library personnel and technical personnel, shown clearly by the numbers
reported in this article, and whether this can be a sign of a takeover of univer-
sities by administrators, not at the expense of the professoriate but perhaps at
the expense of other important support functions.
A popular point of critique among Swedish academics is the housing
arrangements for Swedish universities and colleges. The governmentally
owned limited liability company Akademiska Hus owns close to two-thirds of
all the buildings they use and their required annual dividends to the govern-
ment effectively means that a certain share of the public funding to univer-
sities and colleges is channelled back to the government each year; an
average of 2.3% of their total annual turnover, as noted in a previous sec-
tion. This is itself problematic and cause for some critique but, in the context
of this article, the main issue is the rents’share of the total expenditure,
which has decreased from 14.3% to 12.3% in the years studied. This seems
to be contrary to common beliefs and should be put in proper perspective,
namely comparison with other expenditure categories.
Rents and other operating costs have increased rather modestly (40.5%
and 34.9%, respectively), compared to personnel costs which have increased
16 O. HALLONSTEN
by no less than 85.4%. As already noted above, it is the academic staff and
their salaries that has grown the most: the 32.4% increase in the average sal-
ary of professors and the 29.5% increase in the average salary of senior lec-
turers, are figures adjusted for inflation. This is, in itself, remarkable. One
would perhaps expect that, in an expanding system, salaries would have a
more modest rise but the data suggests otherwise and here, explanations
are multiple and complementary.
It was mentioned in the background section above that weak coordination
is a key feature of the Swedish research policy system. The governmental
allocation of base grant funding follows largely a political logic, whereas the
availability of external grants, also partly political, depends on a much more
heterogeneous set of factors, including individual interest and skill in apply-
ing for such funding, and the agendas and procedures of both domestic and
international, and public and private, funders. Importantly, these processes
are almost completely detached from the key mechanism for salary-setting
in Sweden, namely the central negotiations between unions and employers
(or employer associations) that takes place entirely separately from legislative
processes. Labour unions are historically strong in Sweden and while they
had once a voluntary restraint on salary increases due to collective solidarity,
they later evolved into more autonomous and self-serving organisations
catering to the special interests of their members (Steinmo, 2010; Svensson,
2016). This means that there is a very limited political or bureaucratic con-
nection between the salary increases, driven by the unions, and the increase
in block grants and external grants, (partly) under the control of the govern-
ment, and that the gate is open for the unions organising Swedish academ-
ics to negotiate higher salaries without deeper concern for the funding
available. Which they seem to have done.
To conclude, the article has presented several interesting partial answers to
the research question ‘Where did all the money go?’and also provided explana-
tions and a thorough discussion that both assists the reader in interpreting
the results and positions the study and its results in a broader context. While
the article does not specifically concern the highly problematic developments
in the governance, organisation and funding of academic research and teach-
ing in Sweden and elsewhere, and does not make an explicit contribution to
the lively and important debate over these issues, it contributes indirectly. The
article was written with the conviction that any serious debate and scholarly
investigation of the changing governance of universities and colleges, and the
harmful effects of these changes, must be done with utmost attention paid to
basic facts of the matter, so that problem descriptions and solutions can be
drafted and discussed without being clouded by misunderstandings and erro-
neous beliefs.
QUALITY IN HIGHER EDUCATION 17
Some basic facts have surely and evidently been provided. First, the over-
all resource increase documented in this article should be acknowledged
and used as a counterpoint to the common lamenting among academics. In
addition, it has been shown rather clearly that there is no nominal depletion
of the base grant funding in Sweden in the past 20 years. The base grant for
research increased more than overall income (71.7%), which means that the
research base grant’s share of the total income to the universities and col-
leges also increased. This means that there is no basis for any claim that the
base grant for research has decreased in a general or overall sense. There is
also no taking over of universities and colleges by administrators, at least
not in a numerary sense. The vast increase in funding for research and edu-
cation in the past 20 years has, most of all, been used to hire more (perman-
ent) teaching and research staff and to increase their salaries. That’s where
not all, but most of, the money went.
Disclosure statement
No potential conflict of interest was reported by the author(s).
ORCID
Olof Hallonsten http://orcid.org/0000-0003-4546-3562
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