UNIVERSITIES will be left behind if they do not bow to market demand for "work-based degrees", lifelong learning minister Kim Howells has warned.
The market for degrees is changing rapidly, and employers' requirements are becoming more specific, he said. "I am very interested in the concept of work-based degrees. Every university should look very carefully at this. If they don't, they'll be left behind."
Dr Howells's comments came soon after vice chancellors and business leaders met in London last week for a conference on "pioneering company degrees".
Delegates at the Careers Research and Advisory Centre conference were told that big business was shunning universities in favour of in-house training and education at higher levels, without validation or supervision from higher education institutions.
Frank Gould, University of East London vice chancellor, said that in the United States there were 1,000 so-called "corporate universities", and many had few or no formal links with higher education. British companies were following suit, he said.
Companies must be increasingly dissatisfied with the graduates produced by traditional universities, Professor Gould said. "The trend is there and it would be dishonest of me, as head of a university, not to say I see this trend as a threat."
The Association of Business Schools voiced these fears earlier this year when it gave oral evidence to Sir Ron Dearing's committee of inquiry into higher education.
Corporate universities posed an outside threat with attendant risks and large unknowns, the ABS said. "The ingress of major world corporations into the education sector is already under way with Disney 'edutainment centres'. And the development of corporate universities, as evidenced in the US, is a clear threat to university paradigms and existing market shares domestically," the association said.
But Sir John Egan, chief executive of British Airports Authority, said businesses that attempted to go it alone into higher education, although wanting programmes tailored very closely to their specific needs, would prefer the credibility, flexibility and transferable status offered by formal accreditation or validation from a higher education institution. BAAoffers postgraduate courses in airport management to its staff in association with the University of Surrey.
The market demand for "company degrees" should be seen as an opportunity, not a threat, Sir John said. "To meet the needs of the 21st century, academia needs to be flexible. They must be prepared to meet the needs of the business community in their offerings," he added.
Dr Howells told The THES that it was inevitable that universities would have to adapt. He hailed the "revolutionary approach" to education/business partnerships in Sunderland, where the government's planned new University for Industry is being piloted. "Sunderland sees its future as being tied up inextricably with partners in the region. The delivery of higher and further education is really determined by the success or failure of this partnership approach," he said.
Institutions may be forced into business partnerships, Dr Howells suggested. "Look at the demographic changes. More and more students study at their local university from home. Where does that leave universities in rural hinterlands? If the trend continues, what will they do to attract students? How will they deliver their degrees?" With the white paper on lifelong learning looming, he said that the boundaries between vocational training, further and higher education would become much more "seamless" anyway.
"The days of the fortress walls between the sectors are over. We have got to tear them down."
But even business sees the stumbling blocks. Sir John told delegates at the conference: "Tradition still seems to hold sway in a number of educational institutions. The change of mindset that responding directly to the needs of business engenders seems just too much to cope with for some universities."
Professor Gould said that this mindset was changing, but that the balance between generating revenue through work with business and maintaining academic standards was very delicate.
"Although some universities and university departments continue to insist on the purity of their work - that it must remain untainted by the demands of the future employers of their graduates - increasing numbers of universities are showing a growing awareness of, and responsiveness to, the needs of business and industry.
"This is partly income-stream driven, I would have to admit, as government funding per student reduces year on year. But whatever the motive, it is happening."
Many in higher education think that corporate degrees represent a "dumbing down". Colwyn Williamson, founder of the Campaign for Academic Freedom and Standards, said that business was holding a gun to the head of universities. "Either universities provide these shoddy qualifications, or at a time when they are dependent on private funds, businesses will set up on their own. It is difficult for the universities to avoid being raped." Whatever happened, he believed there was only one outcome: "standards will decline".