Endowment investment returns increased an average of 12.6 percent for the 2010 fiscal year, according to preliminary data released this week by the National Association of College and University Business Officers and the Commonfund Institute.
The upswing, while certainly positive news, falls well short of recovering the historic losses institutions suffered in the 2009 fiscal year, when returns plummeted an average of 18.7 percent. [See a sampling of FY 2009 endowment losses here.]
Endowment values (which take into account both returns and contributions) were hit even harder, with an average drop of 22.3 percent, according to the Council for Aid to Education. (Charitable contributions to colleges and universities declined 11.9 percent in 2009, the greatest one-year loss ever. Fund raising data for 2010 are not yet available, but it's highly unlikely that the previous year's losses will be fully regained in one year.)
Still, with the help of rebounding endowments, most college administrators are not anticipating new rounds of layoffs or widespread cuts elsewhere in their budgets, barring an unexpected and drastic market or economic downturn.
The final NACUBO/Commonfund endowment study will be released in January.
Related news coverage:
"Endowments Rebounding," Inside Higher Ed, Nov. 3, 2010
"Endowment Rebound Reduces Need for College Layoffs," U.S. News & World Report, Nov. 3, 2010
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