American University, which was caught in a severe financial squeeze last year, has more students than expected this fall and is planning to give employes an average 4 percent pay raise in January.
Because of budget problems, the university trustees decided last March to delay any pay increase for at least six months and, in an unusual move, to tie the size of any increase to the number of students enrolled at the institution.
Yesterday, university President Richard Berendzen said that fall enrollment was down 2 percent, to 10,658, compared with a 6 percent loss projected in the university budget.
The additional enrollment will pay the university about $2 million more in tuition than planned, making funds available to increase salaries and also to restore cuts in the library and other services made last year, according to Claudia Bourne Farrell, director of media affairs.
"We had a very aggressive recruitment drive and a very conservative fiscal plan," Farrell said. "Now we're in a healthy position."
American University depends on tuition for more than 90 percent of its teaching and research budget, compared with a national average of 65 percent for all private universities.
Its financial problems last year, caused by an unexpected enrollment drop of 5 percent, were similar to those of many other high-cost private universities without prestigious reputations or large endowments that were hurt by economic recession and the nationwide decrease in the college-age population.
This fall Berendzen said the university's freshman enrollment increased by 137 students, to 812, compared with a decline of 132 students in 1982.
However, he said overall enrollment continued to decrease slightly because of a decline in students transferring to American University from other colleges and the loss of a relatively large class of graduating seniors last June.
"It appears that we have been successful in withstanding the national tide of declining university enrollments," Berendzen said in a statement.
Berendzen said the size of the freshman class had increased "while maintaining our same high admission standards."
From 1978 to last year, American's admissions policy had become more selective, raising the average score of its incoming freshmen from 941 to 1040 on the two parts of the Scholastic Aptitude Test (SAT).
Although final figures are not yet available, Berendzen said he expected that the SAT average this fall would be "at least as good or a tad higher."
About 500 more students were admitted than a year ago, but Berendzen said academic quality was maintained because "there were better students in the pool of applicants and a higher proportion of the top group decided to come here."
Berendzen said the university's endowment, although still relatively small, has reached $11.7 million, about $5 million more than in June 1982. The increase was caused by the surge in the stock market along with fund-raising, he said.
Even though the university was faced with a possible deficit of up to $4 million last year, the university president said that by making cutbacks it ended the fiscal year on April 30 with a surplus of about $250,000, without using any endowment funds.
"Last year was a tough one," he said, "but I think we came out of it awfully well."
Berendzen said the proposed 4 percent pay raise that he has recommended requires approval by the university trustees at their next meeting Oct. 28.
He indicated that they are likely to approve it.