Higher Ed in Oz

The Australian Higher Education sector ultimately continues to be in dramatic turmoil. This is really nothing new. The system has undergone ongoing change since the original expansion by Menzies, the initial abolition of fees by Whitlam, the Dawkins reforms of a unitary higher ed system and then HECS ending with the strangulation under Howard, driving Universities to other income sources (primarily fee paying international and postgrad students) and depriving student bodies of compulsory levies.

On the research side there has been an ongoing centralisation of research funding under both the ARC and the NH&MRC, that not only centralises the dispensation of funds but also establishes "rankings" for journals to assess the worthiness of published papers. The latter has seen various groups I'm involved with (the TJA and heterodox economists) lobbying on getting the journals they are associated with higher up the rankings. Meanwhile the funding process draws more and more universities together into cataclysms otherwise known as Cooperative Research Centres.

The latest round of stories just today tells us that the collapse in inbound overseas student numbers threatens University budgets, that postgradsuate coursework students don't get value for money and that young researchers want careers in academe.

The collapse in international students is firstly a classical problem of exposure of export industries to currency fluctuations, but also a response to the tightening of immigration laws. It is the sort of thing prudent business management includes in the risk profile of the business. But at the same time the Australian universities should consider how they have been treating their own brands. Not one has really pursued the idea of the Australian degree being "prestigious". They have also wasted huge amounts in competing domestically - why does almost every university have a "campus" somewhere in the CBD of Sydney?

A lot of the latter has been the proliferation of ever more esoteric Masters by coursework, much of which would be better administered within professions rather than at Universities. My parents graduated with Diplomas of Dermatological Medicine from USyd but that has been replaced by the Fellowship of the Australasian College of Dermatologists. Academic studies suggest that MBAs now have a negative NPV as an investment.

Finally, the young Wannabe academics say there aren't enough jobs and the salary is uncompetitive. My understanding is that the whole research funding mix also now means young academics bear all the teaching responsibility and the profs do the research. It is a disastrous outcome for all.

A lot of the latter is the consequence of the research funding model. Only the stars get funded. It is very hard to do any research of your own to make a name in Australia.

The consequence is that while we export education we perpetually try to import skilled workers. This isn't a TAFE/apprenticeship problem, as "Recent patterns of job creation underscore why it is so important that more young Australians be given the opportunity to get a degree. Between 2000 and 2009, nearly one-third of total job growth in Australia was in occupations classified as professional."

The economics has always been pretty simple, there is an externality in education. The social benefit of education is greater than the private benefit of education - there are spillovers of the benefit. The same is true of research. Both need to be better funded and funded under a model that encourages Universities to be responsible for their own decision making, and to spend more time building their brands by performance rather than by their success in form-filling or "marketing".

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