So Glad Someone Is Saying This!!!

I’ve had the misfortune to live in a state that has seen Vedder’s conclusions ring true over the last three decades.

Higher education in the state in question has been heavily dominated by an uncooperative set of three state universities. Two of these institutions, which shall remain shameless, have engaged in decade after decade of battles over resource allocation. This has ensured that the state capitol and major metropolitan area (one of the largest in the nation) has not historically had a medical school until very recently, and has been underserved in professional education. This has ensured that the small businesses comprising the bulk of non-service employment — including state government — look elsewhere for their recruiting needs (as was pointed out in the “S-Curve” letter submitted previously on this topic). Local graduates — even those with graduate-level degrees — conversely face a hostile job market.

Over the last decade, state appropriations for the largest university have gone into the stratosphere, tuition has shot up, and the president is now at the top of the salary heap (with frequent appeals made for “rewarding performance” and retention bonuses). The community relations director is a transplant appointee who has behaved in a gratuitously insulting manner to *real* community builders. At the graduate level, the engineering college overwhelmingly supports and serves international students over local students. The level of arrogance on routine display there has reached astounding levels and the university is no longer effectively part of the community in which it operates.

The results have been questionable at best. Of the city’s top 10 employers by number of employees, six are now in grocery and/or discount retail (up from 2-3 just a decade ago). Wal-Mart has come from “off the list” to being the #1 employer. How many large cities is this true of? Meanwhile engineering jobs, and a number of companies, have fled the state, and the diversity of ecominc activity has declined.

It’s not difficult to draw a number of conclusions from the study and this particular state university instantiation. 1) Resource allocation issues between system institutions affect the efficiency of the whole system, and the economic development of the supporting state. 2) Resource misuse is endemic to such systems. This is true on both a disciplinary focus level and an administrative level. On the administrative level resource misuse seems to be growing with a movement in equating practices of public institutional management to those of the business sector (which incidentally, are falling out of favor). 3) States that seem to do well in attracting “desirable” jobs and companies in a range of industries typically are supported by a diverse aggregate of qualitatively-oriented educational institutions, both public and private — not a “mega-size fits all” monolith. 4) The “university as people magnet” model seems to have created a situation here where locals are held back in their educations, careers and businesses — probably to the detriment of the economic well-being of their communities. Again, the “S-Curve” comment above sheds some light on how this occurs, but there are other factors at play — including the frequent employment of “carpetbaggers” with community commitments that are tenuous at best in positions that directly (and often adversely) affect the employment and employability of local people.

Scrawed, at 4:50 pm EDT on July 3, 2007

I’ve long doubted that higher education serves first the nation. Rather, it serves its employees first, the students second, and as a byproduct, the nation.

Given that existing relationship, one expects students to predominantly seek courses offering easy grading rather than courses offering the maximum potential to help the nation. Since student enrollment helps drive university employment, expect to see emphasis on enrollment rather than the academic fields most critical to our nation’s future.

The outcome is an outpouring of degreed graduates combined with stagnant national prosperity and deepening fiscal crisis. Our national economic future is dim and our nation’s university leaders have earned part of the blame.

Marvin McConoughey, at 1:05 pm EST on March 1, 2008

S Curves

If this is true perhaps contributing factors are what type of college the money goes to and where the money goes when it gets to the university. Often, money will go to “educating more workers". Sometimes the money will go to pure research. Depending on the “maturity level” of the industries in the surrounding community there could be a disconnect.

If a majority of industries in the surrounding community are startups then flooding them with hundreds of new, relatively low skilled workers won’t help very much. Startups tend to start small and need highly educated and sophisticated technicians. Of course it depends on the type of product or service being offered.

Conversly, if the majority of businesses are relatively “late” in their technology life cycle they migh want a large supply of relatively low skilled laborers.

Are the economic development dollars going to the community colleges, research universities, both or neither? Lack of planning and specifity by those folks requesting the money is probably more the culprit, then “gross inefficiency at colleges and universities".

R.F., at 9:10 am EDT on June 22, 2007

If the research did not correlate higher ed spending for a partcular state verses the entire economy of the U.S., then inter-state benefits from increased higher ed spending would not be accounted for.

There might be a confounding factor that once a student graduates he or she might move from that state such that the economic benefit might be transfered as well.

Let’s say that educational funding in Michigan produces graduates with technical degrees, but maybe there were no jobs locally. Funds spent in Michigan would not reflect any economic growth in Michigan.

Additionally, I’m not sure that all higher ed spending is linked to faculty salaries. It must be said that increased enrollments bring about the need for new and expanded facilities as well.

Jeff M., at 10:40 am EDT on June 22, 2007

I am confused by the definition of “appropriations for higher education". The study references only expenditures for state universities. Does this then exclude expenditures for community and technical colleges and student financial assistance? Aren’t those also part of the higher education investment fabric? I would be more interested in this study if it only reflected true costs for expansion of educational opportunity and compare that with the state’s economic growth (or lack of it).

Thomas Babel, VP at DeVry University, at 10:45 am EDT on June 22, 2007

higher education and state economy

One response I hope this study fosters is for university presidents to cite other benefits of investment in higher education apart from promises of an improved state economy. How about the worth of increasingly literate citizens, informed voters, knowledgeable consumers, informed individuals on matters of health — and a host of other results apart from economic growth?

I recall hearing historian Laurence Veysey, author of THE EMERGENCE OF THE AMERICAN UNIVERSITY, comment that in the period 1880 to 1910 the incorporation of standard gauge railroad tracks probably had more to do with the nation’s economic growth than did investment in new, expanded universities. That does not mean building universities is a poor choice — it just means that economic pay off (and the promise of it) is dubious.

One limit of the study I see is its reliance on educating individuals and conferring degrees. Isn’t a great deal of the university case about economic benefits often due to non-curricular activities in R&D — such as research parks, labs for advanced scholars and so on — much of which is not necessarily connected to undergraduate degree completion?

John Thelin, Professor at University of Kentucky, at 11:40 am EDT on June 22, 2007

What If Higher ED Funds Don’t Help Economy

If this is the case VEDDER and colleagues in the higher ed should shoulder the blame. They should spend more time teaching in the classroom than engaing in useless research that benefit no one. How does this particular research contribute to economic growth. If Mr. Vedder is spending more time teaching his students at Ohio University society will be better off with knowledge transfer. Interestingly, he is taking the role of an outsider when he is part of the problem he is condemning. Mr. Vadder should visit a community college to see how higher ed dollars directly translates to economic growth in the communities served.

LO, at 12:00 pm EDT on June 22, 2007

Simple Minded Analysis

I’ve had a quick read of the paper referred to in the article.

The authors ask some interesting questions about how to measure effectiveness of education and public money spent on it that are worthy of further consideration.

They undermine their points, however, by some rather suspect use of total university revenue per FTE student. By their own admission, the revenue figures include revenue from commercial operations. Such data also likely includes revenue from research grants and contracts. Because of this, as one of the world’s leading research institutions, U of M Ann Arbor should be expected to have large revenues.

When looking at the state appropriations data it seems that there are probably appropriations to the large research universities that are not directly related to the teaching function. Thus to provide this data on a per FTE basis is also not appropriate, unless the authors were to find a way to remove the non-teaching appropriations from the calculation.

Finally, the conclusion that more university spending results to poorer economic performance is just as ridiculous as saying more university spending results in better economic performance.

The economy is an incredibly complex interaction of factors. To reduce it to a single factor is simply intellectually dishonest. The author’s initial criticism of those in the university sector who make such simple-minded statements is fair game, but to respond with this suspect paper does nothing to advance an honest debate about the role of universities in the economy and society more generally.

Robert Clift, at 2:20 pm EDT on June 22, 2007

Do the same study on Community Colleges?

Using “higher education” as a monolithic sector does a disservice to sectors other than universities (if that was the sector studied, as implied in the article)when studies such as this one are highlighted in such broad terms. It’s no surprise at all that universities overall do not contribute to a regional or state economy directly. This is stating the obvious, as so much research does.

However, many community colleges do contribute directly to the economy and the exconomic data is there to prove it. It’s a disservice to paint all of us in higher education with the same brush. Prof. vedder: please conduct a study on community colleges’ economic impact?

Kevin Drumm, College President, at 4:20 pm EDT on June 22, 2007

Oops

” .. I’m sure that the authors receieved (sic) PhDs at top research universities that were highly funded. Maybe they should see the hypocracy (sic) ..”

Is someone trying to make Prof. Vedder’s case that there are too many colleges, chasing too few qualified students?

Some days, this is just too easy ..

Buzz, at 9:40 pm EDT on June 22, 2007

not a holy grail

Higher ed is not a holy grail in the sense that it gives economic advantage, nor eternal youth nor any other subverted end. Its purpose is to create thinking. Might even be heretical in creating the sort of thinking that says creating advantage in one place at the expense of others is wrong.Other uses of taxes similarly dont produce economic advantage, looking after the sick etc but a humane society does this because there is non economic value. Same for higher ed, economic value is not the only value worth considering. The article suggests there is something wrong with having a better educated populace?

ailsa, at 8:05 pm EDT on June 24, 2007