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'The Global Auction'

'The Global Auction'
December 21, 2010

College and university presidents in the United States and elsewhere regularly link the need for a higher education to individual and national needs for economic advancement. What if their underlying assumptions aren't true? Three social scientists from British universities challenge many of those assumptions in The Global Auction: The Broken Promises of Education, Jobs and Incomes, just published by Oxford University Press. The authors aren't by any means anti-education, but they focus on how some countries -- by investing in education, raising educational attainment and still keeping wages low -- have added complications to the idea of an easy relationship between more education and more money.

The authors are Phillip Brown, distinguished research professor in the School of Social Sciences at Cardiff University; Hugh Lauder, professor of education and political economy at the University of Bath; and David Ashton, honorary professor at the Cardiff University School of Social Sciences and emeritus professor at the University of Leicester. They responded to e-mail questions about their new book.

Q: What are your main critiques of the traditional idea that "learning equals earning"?

A: Most of those in higher education today have grown up with the idea that we live in a knowledge economy requiring an unprecedented demand for college graduates. Globalization, we were told, added to this demand as Americans were needed to do the world’s thinking as workers in emerging economies were limited to low-skill, low-wage jobs in manufacturing or service work, such as in call centers. This "irrational exuberance," to use Alan Greenspan’s term, not only applied to Wall Street but to the rhetoric of "learning equals earning" as Americans and Europeans alike were led to believe that going to college was akin to writing a check with a lifetime guarantee of a well-paid job.

We wanted to put such ideas to the test so we set about talking to business leaders and policy-makers in China, India and Korea as well as those in America, Britain and Germany. What we discovered took us by surprise because of the pace of change in the emerging economies, alongside other changes outlined in the book including the rise of what we call Digital Taylorism (the translation of knowledge work into working knowledge). We were witnessing the creation of a global auction for high-skill, low-wage work that poses a major challenge to the middle classes in America.

Our investigations therefore led us to a different conclusion to Thomas Friedman’s The World Is Flat. He anticipated a race to the top while we view the global auction as divided among those defined as top talent who continue to be given "permission to think" for a living and well-remunerated for their efforts. These are often those who find their way into America’s leading universities because this is where leading employers tend to hire, whereas many others with a college education find themselves in a reverse auction where there are pressures on wages, pensions, health plans, etc. For these college graduates learning does not live up to earning expectations.

Q: Does learning still equal earning in countries with low-wage economies?

A: It depends because there are various stories about intense competition for jobs in China and India as both countries have experienced a major expansion of higher education. There are also reports of student riots in China precisely because learning has not led to earning. But we should not underestimate the rise of the middle classes in both China and India that include many of those with a college education. However, rather like the situation in America, those in elite universities are the major beneficiaries of recent economic development. For those in second-tier colleges and universities, as long as the economy keeps expanding they are likely to experience some material gain from their education. Whether this group is able to equate learning with earning in the future will depend on how well the society does in delivering new opportunities for high value-added work, given the limits to which you can hike wages for less skilled workers even if they’ve been to university. The key point here is that if a country hooks into the global economy through developing English language and STEM competencies, there is the possibility of being able to move up the value chain while remembering that transnational companies are always looking for new locations that offer "more for less."

Q: If more Americans continue to find that undergraduate training only lands them jobs at Starbucks (or the equivalent), what danger does this pose to the reputation of higher education?

A: Whatever global ranking you look at, America has more world-class universities than any other country, and we don’t see much evidence of this changing for at least a decade or two. This suggests that the reputation of America’s leading universities has, if anything, grown in recent years. But the country’s higher education system reflects the wider society in being highly stratified. The inequalities in resources, status and prospects for students are writ large in its colleges and universities. In Andrew Hacker and Claudia Dreifus’s book, How Colleges Are Wasting Our Money and Failing Our Kids, they argue that there’s a crisis of credentialism as many for-profit universities are providing degrees that are near-worthless and at great cost. The Global Auction does not examine the structure of American higher education but it does suggest that exaggerated claims about the income premium a college education will deliver have already damaged the reputation of many colleges and universities as their alumni struggle to find any job, let alone one that meets their childhood aspirations. What is also worrying about this situation is that encouraging people to study STEM subjects may not help to improve the reputation of less prestigious colleges and universities as there may already be an overproduction of STEM professionals. Researchers at Georgetown suggest that there is considerable demand for middle-level skilled workers, but most of these jobs require a two-year rather than four-year college education.

Q: What should American colleges and universities do as a result of the trends your book explores?

A: The book raises a number of issues here, but let’s focus on three of them because they each point to the need for major changes in the way we think about higher education. Firstly, there is a major conundrum confronting higher education around the globe. At the national level, countries are desperate to get some of their universities into the world rankings as much as America wants to maintain its current position. But global recognition typically involves redirecting resources to elite institutions at the expense of other colleges and universities in the same country. The key question is therefore how to reduce current inequalities within American higher education without undermining the country’s global leadership in university research and teaching. In our view these inequalities reflect the demands of a global positional or ranking competition that cannot be justified in educational terms. In short, the current system is unfair and we need to find ways of rebuilding equality of opportunity via the education system.

Secondly, while Digital Taylorism will limit the demand for "knowledge" workers given permission to think for a living, as various fields of occupational knowledge will be captured in prepackaged software delivered by teachers, managers, technicians, consultants, lawyers, doctors, etc., it does not rule out the need for expert knowledge or soft skills including communication, group-working, self-reliance, etc. But it does raise issues about both the intrinsic and extrinsic returns to education. This relates to our final point that the whole "learning equals earning" agenda is based on a narrow economistic view. In the final chapter of the book we argue that there is an urgent need to re-examine the aims of education, and suggest that Dewey’s ideas of a democratic education based on individual and societal growth is a good place to start.

Q: What advice would you offer students in the United States and other industrialized nations on how they should adjust their education plans based on the ideas of your book?

A: Follow your dreams but also do your homework. Start asking hard questions about your reasons for going to college, which college is likely to offer you a high-quality education, and what your chances are of finding a job that meets your expectations after graduation. If you’re aiming high, be prepared for a long and intense competition that doesn’t end when you enter the job market. If you do not see yourself at an elite university, is it better to go for a two-year rather than four-year college education and then opt for further training while employed?

However you look at it, going to university gives you more chance of getting a job, even if it doesn’t deliver the house, automobile, holidays, and pension that everyone in professional jobs seems to have in the movies. But in today’s cold age of austerity it's also a good time to think about what’s really important beyond a paycheck. A university education should never be regarded as simply a meal ticket, but an opportunity for people to study the things that they find intellectually exciting, along with like-minded professors and students. Moving away from a mentality of "learning equals earning" would also offer a better chance of creating a new generation of innovators and inventors who go that extra mile because they are doing it out of genuine interest rather than simply for the money. Finally, although the global auction poses a challenge to the economic well being of the middle classes in America and Europe, it is because we are educating more people across the globe than ever before. This offers unprecedented opportunities for students to study outside of the United States to learn about other cultures; as Dewey observed, "Every expansive era in the history of mankind has coincided with the operation of factors which have tended to eliminate distance between peoples and classes previously hemmed off from one another."

 

 

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