Why a glut is good

February 14, 1997

Political parties are conspiring to keep higher education off the election agenda. Last week disaffected backbencher and former higher education minister, George Walden, did his best to stir things up by drawing attention to the Government's fourth submission to the Dearing committee but with limited success. The education department's paper suggesting a limit on publicly funded student numbers caused a storm over the issue of whether we have enough graduates, but its proposals on quality control and research selectivity were not contested.

The question of graduate output is important. Attempts to quantify and separately identify the return from higher education to society and to individuals are fraught with difficulty. That has not stopped people trying. The late Keith Joseph had a go in his 1985 green paper The Development of Higher Education into the 1990s.

Governments, keen to limit the cost, and elites anxious not to have their advantages eroded, are easily tempted to downplay the economic advantage of producing more graduates. Yet repeatedly fears of a graduate glut are confounded as graduates flow into the labour market, take jobs in existing businesses and transform them or create new businesses and activities which no one had predicted.

As a salutory reminder of the recurring panic about over-production of graduates, the Society for Research in Higher Education's latest newsletter contains a summary of a paper by David R. Witmer of the University of Wisconsin, La Crosse, in which he recalls the anxiety that greeted the GI Bill in the United States after the second world war when demobilised veterans were given access to universities with the result that enrolments doubled between 1939 and 1949. The figures he uses for private and social gain show that as enrolments have risen both private and social benefit have increased - and so has the value of shares on the US stock market. Glut seems to have been good for the American economy. The problem is not too many graduates. It is too many without qualifications left further and further behind. This suggests that policy should be for both more higher education and more education at lower levels.

If the Government is going to play the somewhat dubious game of apportioning benefits, it should at least take account of all the available information. It has not. Lee Harvey's research (THES, February 7) shows quite a different picture from that in the department's submission. Professor Harvey's study shows that employers value graduates for the added value they bring to business and for their ability to take responsibility for their own work.

Research findings by the University of Warwick's Institute for Employment Research reported today (page 3) also present an alternative scenario to the one seized on by the DFEE. If recent trends continued, demand for graduates would actually stay ahead of supply: a possibility which seems to have been overlooked by the department, even though it bases many of its conclusions on the IES study. Even if the return to public investment was falling it would not invalidate the case for greater expansion because of the high return to individuals. They are less likely to be unemployed and more likely to be highly paid. It is not government's role to deny individuals the opportunity to improve their life chances. Instead they should be looking for ways to make it possible for more people to study longer: better to sort out the means whereby students can buy their way in than resort to rationing.

Labour has sort of said this. But their response has been muted. While they favour access, they too are hugely reluctant to discuss the financial implications. They are also equally keen to gear higher education to the needs of the labour market. So as the education secretary, Gillian Shephard, steered the debate off higher education on to A levels this week, Labour's leaders sought to damp down anxiety with promises that extra money for education would be found from other departments' budgets, particularly employment.

Joint determination to keep higher education off the hustings is but one of the surprisingly cosy arrangements which seem to have developed between Mrs Shephard's department and the Labour education spokesman, David Blunkett, in respect of higher education issues. This cosiness should worry higher education: it smacks of a stitch-up. In particular there is cause to worry over plans for quality control and standards - an area officials have long sought to get within their grasp.

This new Dearing evidence goes further than before in favouring central direction. Sir Ron is known to be highly interested in this area. The new quality agency for higher education is not as far advanced as it should have been and is vulnerable to nationalisation by an incoming government. Work on the thorny issue of standards has barely begun among the universities themselves.

Waiting for Dearing may not in these circumstances be a clever plan. Better instead to get moving independently. An election campaign is a good time to secure commitments. The policy doldrums surrounding an election are a good to time to build defences.

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