Superpowers lose ground as balance of power shifts

'Redistribution of brains' on cards as US and UK struggle to cope with the recession, writes Phil Baty

July 9, 2009

A global "redistribution of brains" may take place as academic job security diminishes and the world's education superpowers lose ground to emerging nations as a result of the economic crisis.

This was the scenario outlined at an international higher education conference last week, run by the Organisation for Economic Co-operation and Development.

Speakers from universities and governments across the world predicted "churn" in the international job market as leading institutions are forced to lay off talented staff and the salaries offered by emerging university systems become more competitive.

Delegates also heard that traditional tenure systems offering "jobs for life" are set to become a thing of the past.

The conference, Higher Education at a Time of Crisis: Challenges and Opportunities, saw the presentation of a bleak economic analysis by Sven Blondal, head of the macroeconomic policy division at the OECD.

He said that while the global economic crisis was likely to heap pressure on public spending across the OECD's 30 member nations - putting education spending at risk as a result - some countries would be harder hit than others.

Mr Blondal said that the US, the UK, Ireland and Spain would have to institute dramatic spending cuts to rein in public debt, adding that they faced a "very, very challenging situation indeed" to consolidate their budgets.

He stated that Canada, France, Germany, Italy and Japan would cope better thanks to their more modest debts, while most of the Nordic countries, as well as Korea and Switzerland, were unlikely to face much retrenchment.

Hosting a round-table discussion, Hans Peter Mollgaard, head of the department of economics at the Copenhagen Business School, Denmark, the site of the conference, said that the US "is in for much more painful reform than others".

He asked: "Will there be a redistribution of brains across the world?"

"Yes," said panellist John Hudzik, vice-president for global engagement at Michigan State University. He acknowledged that the US faced particularly tough times.

"Endowment-giving has been hit first and hit hard - 45 per cent of operations in some cases are supported by endowment funds, and they have suffered huge losses," he said.

This, combined with "two to three decades of disinvestment" in higher education by state governments, plus the fact that tuition-fee levels had hit a price ceiling, meant that the US was likely to lose ground, he added.

Professor Hudzik also suggested that the "relatively rapid development of high-quality higher education systems across the world will create more employment opportunities for good academics than in the past".

Pointing out the ongoing price competition to attract top scholars, he predicted that the US would "be a net loser in this because competition is widening".

Koen Debackere, professor of managerial economics, strategy and innovation at the Catholic University of Leuven, said it was "plain logic" that job mobility in the academic world would intensify, especially as the US "is in for a more serious time ahead".

"Do not forget Asia in this picture," he added. "Most of the growth potential will be there."

End of the line for tenure track

Tom Boland, chief executive of the Irish Higher Education Authority, said the sector "is very much a global activity and the current crisis will enhance that".

He said there would be more "churning up" of the international university system.

Mr Boland also predicted that the crisis would diminish traditional academic job security, putting pressure on systems that award tenure. "My sense is that a key development for Ireland emerging from the crisis is the need for greater flexibility in staff contracts," he said. "Inflexible staff structures mean you can't remove underperforming or non-performing staff."

He added that tenure "seems to be very dangerous to the development of higher education" because it is "hostile to the concept of innovation in teaching and learning".

"Some people simply won't perform" and nothing can be done about it, said Mr Boland, adding: "I'm not in the field of throwing out all protection for people, but there needs to be some rebalancing."

Professor Hudzik predicted that more institutions would engage in "constellation hiring" - appointing one or two big research stars that universities could use to attract other academics.

At the concluding session of the two-day event, Dirk Van Damme, head of the Centre for Education, Research and Innovation at the OECD, said the sector faced "serious challenges in staff policies".

Dr Van Damme said that in light of the economic crisis, senior staff might postpone their retirements, so "some institutions may be obliged to lay off well-qualified staff, often junior and more productive".

He said: "Such staff will enter the academic labour market and will be willing to be very mobile."

He went on to add that "increased competition may push down salaries".

phil.baty@tsleducation.com

- www.oecd.org/edu/lighthouse.

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