Roger Rees of the Open University's faculty of Social Sciences reviews The Global Auction, a new book on the marketisation of higher education, and examines the implications for universities and their graduates.
As Gordon Brown’s time as PM drew to a close, Peter Mandelson said Britain had too much ‘financial engineering’ and not enough ‘real engineering’. When the banking crisis hit, UK manufacturing employed three million people. In contrast, financial services employed six and a half million. At the start of a new century, the former ‘workshop of the world’ had just three world class sectors – pharmaceuticals, arms production and financial services. And as the crisis developed, finance shed 100,000 jobs between 2007 and 2010.
The Coalition government's response has been to proclaim a “re-balancing of the economy”. What can this mean? A key element involves creating a ‘knowledge’ or ‘magnet’ economy with higher education as a critical component. Marketised universities are intended to attract to our shores (‘like a magnet’) a world eager to employ our graduates. Other nations (implicitly Asian, South American and Eastern European) can supply low-skill, low-wage manufacturing labour, while Western nations, like the UK, provide the high-skill, high-wage brainpower – a global economy of ‘body’ nations and ‘head’ nations. That’s the knowledge economy model in a nutshell. It suggests a bright future for British universities and their graduates.
The Global Auction presents a very different picture. Its authors (sociologists from Cardiff, Bath and Leicester universities), cogently challenge the 'opportunity bargain' at the very heart of the model – that is, students financially invest in their higher education and acquire high-level skills in return for the opportunity to obtain high-income knowledge jobs.Based on interviews with hundreds of global corporate executives and national policymakers, authors Phil Brown, Hugh Lauder and David Ashton argue this opportunity bargain is crumbling in the face of four developments.
The first is the explosion in world student numbers, doubling in the last 10 years. India aims for 30 million graduates by 2025. China plans 35.5 million by 2020. The latter has already built a Higher Education Mega Centre – 10 universities on one island with 120,000 students, 20,000 academic and 50,000 support staff. With room for a further 80,000 students!
Meanwhile, low wage economies have undergone a quality-cost revolution. They are now capable of making low-cost products to world quality standards. Trans-nationals, taking advantage of the graduate boom, are placing R&D facilities alongside factories in those countries, close to booming new consumer markets. They are bolstered by government policies and local graduate brainpower. China’s shift from military research, for example, has helped boost its expertise in areas of solar energy and electric engine technology.
Digital Taylorism is also gathering pace – that is, white-collar, professional work is broken into elements, which are standardised, computerised and can then be delivered by low-skill, low-wage labour. The seemingly endless computerised ‘telephone tree’ in which you eventually, get through to an operator who can only respond to a specialised area of your query, is one digital Taylorist example we are all now familiar with. Complex white-collar skills are turned into globally mobile, bite-sized, digitised choices. Ominously, an online distance-learning university could provide its content, using such techniques, from anywhere in the world. Wherever the labour is cheapest. A relatively high-cost base in the South of England may not be the only option!
These three developments then fuel a fourth: a global 'war for talent'. A world awash with graduates becomes prone to forces directly undermining the opportunity bargain. Many Western graduates may get opportunities alright but they involve long hours, job insecurity, lower pensions, declining career prospects and lower wage levels than they ever expected (or borrowed for). Already a third of graduates in England who took education loans in 1998, have yet to pay a penny back, failing to reach the required modest re-payment salary level.
All these trends make the ‘head’ and ‘body’ nations concept look simplistic (not to say neo-colonialist). And then the plan to make the UK a knowledge economy becomes a fairytale. So, if the authors are correct, what are the consequences for UK graduates and their universities?
Well, global corporate recruitment is now focused on elite institutions. Why waste resources looking down the league tables when there are plenty of graduates at the top? The tendency for UK universities to opt for £9,000 fee levels is an indicator of the intense competition developing to brand themselves as members of that educational elite.
But such recruitment practices exacerbate wealth inequality and social division, since the elite show little sign of broadening their intake. Oxford still draws 90% and Cambridge 89% of their students, from professional and managerial family backgrounds. To those who have, shall be given. And employers, in a graduate glut, demand behavioural competencies. Not just a top degree but self-confidence, communication skills and “social fit”. Again, the elite have an edge. So the curriculum will incorporate a greater employability focus.
The unenviable longer-term prospect looms of a wealthy identikit management elite, atop a majority pyramid of graduates whose financial investment in their own education has misfired – their opportunity bargain turned sour. What will happen to creativity under such circumstances, Brown and colleagues ask, the real source of future national innovation?
Universities could face reduced student numbers as potential applicants notice the bargain only works for a minority. The number of universities subsequently declines and with few exceptions, those that remain specialise within an ever-narrowing curriculum, attempting to support an elite profile internationally. Marketisation after all suggests market niches. Specialist engineering universities? Management universities? Science universities? With corporate sponsorship, containing broad implications for critical analysis and research? Or, as one commentator has suggested, 'consumerversities' offering a different kind of opportunity bargain. One selling a greater chance of their graduates entering a given employment field or some/all of their money back?
Brown, Lauder and Ashton’s alternative to what they view as this dystopian educational future draws attention to the two nations most doggedly pursuing a free-market economic approach to Higher Education – the USA and the UK. Here the financial rewards for managerial elites, based on measures such as short-term shareholder value and severe organisational cost cutting, have become obscenely skewed and social inequality has sharply increased. Twenty five percent of working families in the USA now exist on poverty wage levels. They contrast this with others (including China and India) where the state has heavily and directly intervened economically, regulating development and inward foreign investment, committed to long-term infrastructure and education policies to boost overall economic capacity.
The authors call for more effective corporate regulatory mechanisms, longer-term economic strategies, wider stakeholder considerations, a more active role for international agencies promoting social justice, societies which are prepared to reward co-operative, as well as market, contributions. Could these be the kinds of features encouraging economic analysts to recently suggest Northern Europe, including Scandinavia, will become the powerhouse of the future global economy?
If the very readable, powerful and unsettling analysis contained in The Global Auction holds true, the UK is currently set on what Brown, Lauder and Ashton suggest is the global slow lane. One in which the country’s universities and their graduates will pay a heavy and uncomfortable price, economically and socially. Every member of the current Cabinet, let alone every university manager, should read and engage with the issues this work raises. Sadly, in the current headlong dash to the latest commercial business model (‘going forward’ of course), all too few are likely to do so.
This piece was first published on the Open University's Society Matters blog.
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