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How the crisis might transform higher education: some scenarios. Stéphan Vincent-Lancrin OECD Centre for Educational Research and Innovation. Outline. Enrolments Expenditure Levels Possible impact on stakeholder Scenarios. Tertiary education enrolments.

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how the crisis might transform higher education some scenarios

How the crisis might transform higher education: some scenarios

Stéphan Vincent-Lancrin

OECD

Centre for Educational Research and Innovation

outline
Outline
  • Enrolments
  • Expenditure
    • Levels
    • Possible impact on stakeholder
  • Scenarios
evolution of the 18 24 population by 2025 2005 100
Evolution of the 18-24 population by 2025 (2005=100)

Source: United Nations, Population division (revision 2006)

scenario 1 projected tertiary enrolments in 2025 under current conditions 2005 100
Scenario 1: Projected tertiary enrolments in 2025 under current conditions (2005=100)

Source: OECD, Higher Education 2030, Vol. 1 Demography

scenario 2 projected tertiary enrolments in 2025 under recent trends 2005 100
Scenario 2: Projected tertiary enrolments in 2025 under recent trends (2005=100)

Source: OECD, Higher Education 2030, Vol. 1 Demography

why the trend scenario is more likely
Why the trend scenario is more likely…
  • Supplywill not betoolimited
    • Knowledgeeconomy
    • Crisis-relatedpoliticalreasons (better to have studentsthanunemployed people)
  • Demandwillincrease
    • Individualreturnsremainhigh (compared to highschoolreturns)
    • Decrease of opportunitycost (crisis)
    • Demand of retrainingfromunemployedworkers
    • Lessapprenticeshipavailable (crisis)
with limiting factors
…with limiting factors
  • Rising cost to public authorities
  • Rising cost to students and families in a context of unemployement and saving/capital losses
  • Less ability to contribute of the business sector
some qualitative changes in the student population
Some qualitative changes in the student population
  • More demand from mature students
    • More demand for short term programmes
    • More demand for vocational programmes
  • More difficulties for students from lower working and lower middle classes
    • Where caps on student numbers
    • Where high tuition fees
    • Where insufficient student aid
slide12
Projections of total expenditures for tertiary education institutions in 2025 (% of GDP): pre-crisis scenario

GDP set at 2% growth and educational costs per head projected linearly according to 1995-2005 growth rate (constant prices)

Source: OECD, Higher Education 2030, Vol. 1 Demography

public funding for he
Public funding for HE

Budget pressure

Response (?)

Cuts on expenditures to HEIsafter relative protection under stimulus packages

Slowergrowth of public expenditures in the longer run

Rise in tuitionfees

Inadequatestudentaid (?)

More competitive allocation of funding and further segmentation of systems

  • Unemployment and social benefits
  • Consolidation of public budgets
  • Ageing-related expenditure
  • Continued expansion of HE
  • Rise of eligible students for student aid
private funding for heis
Private funding for HEIs

Pressure

Response (?)

Less ability to fund university research, to fund their employees for training and and to participate in university programmes

But this source of funding is marginal in most countries (except Canada and US)

  • Less business:
    • Cuts on R&D expenditures
    • Cuts on corporate training
    • Less endowments of foundations
    • Less willingness to have interns and apprentices? (unless they can contribute to production)
household funding for heis
Household funding for HEIs

Pressure

Response (?)

Willingness to invest more in HE where household cost has been low so far

Difficulty to do so in countries where tuition have already rised significantly recently

  • Decline in revenues of parents
  • Less ability of intergenerational transfer as older people are hit by budget consolidation
  • Unemployment for parents and difficulty to work while studying
  • Inadequate student aid for lower SES
institutional response
Institutional response

Revenue

Cost

Postpone maintenance and infrastructural costs, including library costs

Look for further administrative efficiency

Freeze hiring of new faculty

More differentiated status of new faculty (teaching/research)

Increase student/staff ratio or decrease face-to-face instructional time

  • Raisetuitionfeelevels (if theycan)
  • Look for new revenues (international studentswheredifferentialfee, part-time students, furthereducation, non-degreeeducation, etc.)
  • Compete more for researchfunding
  • Efforts to raise more corporatefundingwhereitissmall (but slow process)
impact of the economic crisis
Impactof the economic crisis
  • Short term impact on access issues:
    • Increase in participation in tertiary education
    • Increase of the share of higher education expenditures in public expenditures and GDP
    • Costs will be a limiting factor in countries where there is a significant share of household funding
    • Possible rise in inequity
  • Longer term impact:
    • Risk aversion of students and family: less confidence in loans and financial products and less investment in higher education?
    • Slowdown or acceleration of internationalisation?
    • Restructuring of higher education systems?
intermediate conclusion
Intermediate conclusion

Before the crisis

  • In most countries, the budgetary impact of the crisis was not significant
  • Ageing could have affected priorities, but no strong evidence

After the crisis

  • Budgetary impact couldbecome more significant (undervery conservative assumptions)
  • Public consolidation after stimulus packages and crisis-related social benefitswillmakedifficult for HE budget to grow
scenarios for higher education systems
Scenarios for higher education systems

International

MarketDemand-driven

AdministrationSupply-driven

National

4 scenarios
4 scenarios
  • Open networking
  • Serving local communities
  • New public responsibility
  • Higher education, Inc.
scenario 1 open networking
Scenario 1: Open Networking

Drivers

  • International cooperation & harmonisation of systems
  • Technology
  • Ideal of open knowledge

Relateddevelopments

  • Bolognaprocess, international academicpartnerships and consortia,
  • Increasingcomputing power and culture of opennesschallengingtraditionalintellectualpropertyrights

Features

  • Intensive networkingamong institutions, scholars, students (& industry)
  • Modularisation of studiesunderacademics’ control
  • International collaborative research
  • Stronghierarchybetween networks but quick spillovers
  • Lifelonglearningoutside the HE sector
scenario 2 serving local communities
Scenario 2: Serving local communities

Drivers

  • Backlashagainst globalisation
  • More geo-strategicsensitivity in research
  • Costefficiency

Relateddevelopments

  • Anti-globalisation movements
  • Crisis?

Features

  • (Re)focus on national and local missions
  • Public funding and control of the academic profession
  • Convergence betweenuniversities and polytechnics
  • Elite universities struggle to stay more internationalised
  • Lessresearch, mainly on humanities
  • Big science relocated to governmentsector (more secretive and lessinternationalised)
scenario 3 new public responsibility
Scenario 3: New public responsibility

Drivers

  • Pressure on public budget (ageing, public debt, etc.)
  • Diffusion of governance structures based on new public management

Relateddevelopments

  • Autonomygiven to HEIs (sometimeslegallyprivatised)
  • Debates on cost sharing
  • Encouragement of competitionbetweenHEIs

Features

  • Mainly public funding but autonomous institutions controlled at arm’s length (incentives + accountability)
  • Mixed funding: new markets + more tuition fees (income contingent loans)
  • Demand-driven system with more marked division of labour (specialisation but most HEIs continue to do some research)
  • Research funds allocated through domestic competitive process (except for Europe)
scenario 4 higher education inc
Scenario 4: Higher education, Inc.

Drivers

  • Trade liberalisation in education (GATS, bilateral)

Related developments

  • Rise of trade in HE & inclusion of education in trade negotiations
  • International competition for students
  • Increase of cross-border funding of research

Features

  • Global competition for education and research services
  • Public funding for non-commercially viable disciplines exclusively
  • Segmentation of the education and research market
  • Vocational higher education: important share of the market
  • Strong (international) division of labour according to competitive advantage
  • Concentration of research and worldwide competition for funding
  • English as main language of study
scenarios for higher education systems1
Scenarios for higher education systems

International

Open Networking

Higher Education Inc.

Administration

Market

New Public Responsibility

Serving Local Communities

National

new publication higher education to 2030
New publication:Higher education to 2030

Forthcoming:

  • Volume 2: technology
  • Volume 3: Globalisation
  • Volume 4: Scenarios
thank you
Stephan.Vincent-Lancrin@oecd.orgThank You

www.oecd.org/edu/universityfutures

www.oecd.org/edu/innovation