HESA

Higher Education Strategy Associates

February 02

Why is CAUT Cheapening Academic Freedom?

Academic freedom is precious; it’s not something you want to mess with  – which is why it is such a mystery that the Canadian Association of University Teachers (CAUT) permitted the Report of the Ad-hoc Investigatory Committee into the Department of Economics at the University of Manitoba to be published.

The back story, near as I can tell, is: for decades, the UManitoba Economics Department contained a fairly large squad of what are known as “heterodox” economists (i.e. political economy types who in the 70s would mostly have described themselves as Marxist or Institutionalist).  They were never a majority within the department, but they certainly gave the place an overall pinkish tinge.

Then, for obscure reasons around 2006, relations between heterodox and “mainstream” factions in the department seemed to deteriorate.  There appears to have been some seriously childish spats at departmental meetings.  There was a contentious departmental chair search, which one of the “hets” lost.  New hires tended to be reserved for mainstream economists, which hurt the hets’ feelings, as they wanted to maintain the “balance” between heterodox and mainstream.  Hets’ grad students tended to get the short end of the stick when it came to recommendations and funding, or would be told they were unlikely to get jobs after graduation. Etc., etc.

Now, this kind of stuff happens all over academia.  What a discipline believes collectively about itself and its methods changes over time.  Those  on the “winning” side tend to do pretty well; the other side, less so.  We’ve seen fights like this over post-modernism in History, critical theory in English, and in anthropology between its cultural and social wings (at Stanford, that fight got so bad in the 90s that they temporarily split Anthro into two separate departments).

In a decent workplace, management would have told everyone to shut up and get back to working together.  But in universities this almost never occurs; “collegiality” permits a lot of bad behaviour to go unpunished.  And so instead of everyone finding a way to work together like adults, someone went and convinced CAUT to send out a commission of inquiry to find out if the treatment of the heterodox amounted to a violation of academic freedom.

The thing is, if you get CAUT to “investigate” a claim, you can be pretty sure the answer will be “yes”; examples of “investigations” where the complainant is not found in the right are pretty much non-existent.  Everyone at University of Manitoba knew this, and so two-thirds of the department – basically everyone in the orthodox camp – simply refused to talk to investigators. This fact is largely glossed over in the report itself, but it’s significant both because the report is almost certainly unbalanced in the complainants’ direction, but also because it’s clear that a whole bunch of CAUT members believe that CAUT does not have their interests in mind.

Predictably, the investigating team “found” that the hets’ minority academic rights had been infringed.  To correct this, they suggested (among other things) a new search for a department head, and ensuring that the next three appointments all be heterodox economists.  Their rationale was that mainstream economists have “persecuted” heterodox, just as the established church used to persecute free-thinking academics (and yes, really, that was the argument).

Now, possibly, there is an argument to be made that the sandbox fights have become so extreme that it’s time to take the Stanford route, and take the hets out of Economics by creating a Department of Political Economy.  But the idea that minority views within a discipline automatically deserve “protection” and guaranteed quotas of appointments?  Who would police this?  Would CAUT argue the same for climate change deniers in Environmental Sciences?  That way madness lies.

But more importantly, the idea that even the unbalanced parade of allegations presented in the report amount to an infringement of academic freedom is simply nonsense.  No one’s fundamental rights of expression or freedom of inquiry were eroded; at the absolute worst, what occurred amounts to ideologically-based intra-departmental sniping and score-settling.  To claim that this amounts to a violation of academic freedom is to deprive the term of all meaning.

And that’s bad, because academic freedom matters.  The last organization that should be cheapening this is CAUT, and the worst reason to do so is in helping out a few ideological fellow-travellers in a sandbox fight against other academics.  Yet here we are.

January 30

The Case of Southwestern Ontario

Yesterday I talked about ways universities can generate economic growth, and I promised to offer an example from Southwestern Ontario.

Southwestern Ontario has been in the news a lot recently due to its deteriorating economy, not least through the efforts of Western professor Mike Moffatt.  More recently, the Globe’s Adam Radwanski penned a feature article on what southwestern Ontario can learn from such economic revivals as has happened in the US rust belt.

Radwanski’s argument is a long one, but the bit relevant to post-secondary education just cites the examples of Pittsburgh and Akron, and says that universities should work more closely with industry to create new hi-tech centres of production.  Right off the bat, I think we can discard the Pittsburgh example.  For one thing, the city is in fact continuing to hemorrhage manufacturing jobs (3,000 last year alone), and for a second, the two institutions that have done the most to power the local economy are Carnegie Mellon (private) and Pittsburgh (semi-private), with a combined endowment of $5.6 billion.  Last I checked, the combined total for Western and Windsor was around $700 million.

Endowments matter because they allow institutions to take risks.  It’s probably not a coincidence that if you look at major US tech and innovation hubs where universities have served as a catalyst (e.g. Silicon Valley, Route 150 in Boston), the institutions at the heart are all private, and hence not worried about legislative scrutiny.  The only exception to this rule – UT Austin – just happens to be the world’s second-best endowed public university ($6 billion in assets, behind Michigan at $8 billion).

Ah, you say – but what about Akron?  That’s a public university, and it had a big role in helping the local rubber industry transition into a centre of excellence for polymers.  And yes, Akron is actually an excellent example, because it has a very close Ontario counterpart; namely, the University of Waterloo.

These days, people associate Waterloo with co-op, engineering, and integration with the local hi-tech economy.  But it’s worth remembering that when Waterloo started out in the late 1950s, the hi-tech economy didn’t exist.  Back then, Waterloo’s main industry – like Akron’s – was tires, and for the first decade or so of its existence, Waterloo was all about working with the tire industry.

Could Waterloo have worked harder to “save” the local tire industry, as UAkron did in Ohio?  Possibly.  But one big thing Akron had going for it was the fact that Goodyear had its corporate headquarters there.  Companies tend to do R&D close to home.  Even if Waterloo had tried some of the stuff Akron did, there’s no guarantee it would have had the same results because at the end of the day, Waterloo was a branch plant economy.  That matters.

Instead, of course, Waterloo did something better: it invented a new local industry essentially from scratch.  This did not occur by “working with industry” as we traditionally think about it.  It happened by giving a lot of people advanced training in a particular area, letting them create and spin-out companies, and then wait for the local economy to develop the deep pool of managerial skills and venture capital sources required to take products from concept to market.

(The importance of this last bit is insufficiently appreciated.  Take UBC, one of the country’s leaders in technology transfer: its life sciences spin-offs had a miserable time in the 80s and 90s because back then the only thing the local VCs and entrepreneurs understood was how to cut down trees and dig stuff out of the ground.  There’s a domestic life-sciences business ecology in Vancouver now, but it took 20 years to develop the required knowledge and skills.)

So, could Western University play a role like U Akron or U Waterloo?  Yes.  But it would have to bet on an industry or two (and it’s not clear which ones would make most sense).  And for the moment it is unclear that they have the desire, the cash, or the political backing to do so.  And even if they did, results would likely take a decade or more to show.  It’s a fix, but not a quick one.

January 29

Universities and Economic Growth

If you read the OECD/World Bank playbook on higher education, it’s all very simple.  If you raise investments into higher education and research, growth will follow.

At the big-picture national level, this is probably true.  But it’s maddeningly inspecific.  What is the actual mechanism by which higher spending on a set of institutions translates into growth?  Is it the number of trained graduates produced?  Is it the quality or type of education they receive?  Does concentrating research in certain areas mean greater growth?  What about the balance between “pure” and “applied” research (insofar as those are useful distinctions)? What about technology transfer strategies?

Most importantly for a country like Canada: what about geography?  Is a strategy of widely distributing funds better than a strategy of concentration for spurring economic growth?  Should urban universities – nearer the centres of economic production – get more than universities in smaller conurbations?

Anyone telling you they have the definitive answer to these questions is lying.  Fact is, the literature on most of these topics is embarrassingly thin and provides little to no guidance to governments.  And the literature as it pertains to individual universities is even thinner.  Say you want an institution to “do better” at helping deliver regional economic growth: what do you ask it to do, exactly?  Here, the literature mainly consists of anecdotes of success parading as universally-applicable rules for university conduct (this European Union document is an example).  Which of course is tosh.

One solution you often see to the problem of decreased regional economic growth in smaller cities is for PSE institutions to “work more with industry”.  But if your local industry is in decline, there are limits to this strategy.  You can educate more people in a given field in order to lower the price of skilled labour.  You can get profs to work on upstream blue-sky research that will revolutionize the field, but the spillovers are enormous and the likelihood they will be captured by local business is small.  You can get your profs to work on downstream innovation with local business, but that’s not foolproof. Many companies won’t have the receptor capacity to work with you, either because they are too small or because they are too big and rely on a centralized R&D system, which more often than not is located outside the country (usually the US).

From a PSE point-of-view there’s two ways you can go from here.  There’s the route of “give us more money and we’ll give the local workforce a broader set of skills”.  But the fact that a local population has high levels of relatively generic skills does not necessarily make a region a particularly attractive place for investment.  I’m not an economic geographer, but it seems to me that one of the driving forces of the modern era is that the most profitable companies and industries are those that effectively capitalize on agglomerations of very specific types of talent.  And by and large, to get agglomerations of very specific types of talent you tend to need a large population to begin with, which is why big cities keep getting bigger.

The other option is a “place your bets” approach.  For emerging industries to find the right kinds of skills in a particular region, you have to place bets.  You have to say: “we’re going to invest in training and facilities to produce workers for X, Y, and Z industries, which at the moment do not exist in our region, and indeed may never do so.  Cape Breton University’s emphasis on renewable energy is a good example of this strategy.  It’s a bet: if they get good at this and produce enough graduates, maybe within a few years there will be enough of a talent agglomeration that business will go there and invest.

Maybe.  And maybe not.  Problem is, public universities and their government paymasters get nervous about “maybes”.  Higher education is a risk-averse industry.

Tomorrow, we’ll look at a case study in this: Southwestern Ontario.

January 28

Another Australian De-regulation Update

So the last time we tuned into antics in Canberra, the government was trying to pass a fairly ambitious piece of legislation that would completely de-regulate tuition fees while (more or less) maintaining the HECS system, which means post-graduate contributions are always tied to income, and thus do not become too onerous.  The government was also going to cut institutional grants by about 20%, but keep the “demand-driven” system in which government dollars follow students no matter how many students attend.

The problem with this, politically, is that the government does not control the Senate.  With Labour and Green opposed to the coalition, the government needs to attract six of eight votes belonging to independents and minor parties to get anything done in the upper chamber.  Late last year, four of those senators were making positive noises. Two others (including the delightful Jacqui Lambie – seriously, click that link, it’s totally worth it) were implacably opposed, while the final two in play – Dio Wang of the vaguely Ford-ist (minus the drugs) Palmer United Party, and Independent Nick Xenophon – were opposed, but perhaps open to passing a deal with amendments.

So the government switched into deal-making mode, right?  Wrong.  For reasons that defy rational explanation, the coalition opted for a snap December Senate vote on the package, as-was.  Cue a two-vote loss.  Frank Underwood would not have been amused.  In Australian parlance: the coalition whips were clearly a few sheep short of a full paddock.

But that wasn’t the end of the story.  In response, the lower house simply adopted the same bill again, and sent it back to the Senate – only this time the government was ready to deal.  The 20% cut in government grants, those “necessary” savings that required the government to introduce de-regulation?  Turns out they’re negotiable – de-regulation apparently now matters more than fiscal probity.  The universities can hardly believe their luck: full freedom to increase fees, and no loss in government grant?  I don’t know exactly what’s going through vice-chancellors’ heads right now, but I’m betting that the words “eating”, “too”, “having”, and “cake” are all in there somewhere.

Problem is the government isn’t negotiating with vice-chancellors, it’s negotiating with Wang and Xenophon.  Wang has now said he is personally for de-regulation, but will abide by a caucus decision on the party line when voting (the question remains open as to how this would work, given that the only other Palmer senator is dead-set against the bill).  Xenophon wants the whole matter of university funding tossed over to a big bipartisan commission, a position which manages to be both sensible and absurd.  Sensible in that yes, changes of this magnitude are best done in bipartisan fashion, because otherwise institutions get policy whiplash if the opposition comes to power and undoes the change (a point I made back here).  On the other hand, it’s absurd in that there have been quite a few inquiries and commissions into higher education in the last few years; there are few secrets about the current system’s strengths and weaknesses.  Also, bipartisan commissions take two to tango, and there’s precious little sign the opposition Labour Party has any interest in handing the government a way out of this debacle (even if, as is whispered, some of them actually approve of the policy).  Xenophon presumably knows this, which is why his position – in Canadian parlance – is classic ragging the puck.

The clock is ticking on this proposal.  Universities need to know what to tell incoming students about their fees, so the question pretty much has to be solved by March.  That means another vote in the next five weeks or so.  Given the government’s ham-handedness in handling the file to date, odds are it’s not going to pass, though stranger things have happened.  But given the vaulting ambitions of Australian universities, and the seemingly limited desire of Australian government to fund higher education (per-student government funding is 30-40% lower than in Canada), it’s hard to imagine this option not coming back in some form in 2016.

January 27

Setting Tuition Fees

On what basis can tuition fees be set?  Let us count the ways.

The most obvious is “whatever the market will bear”.  This is the way most goods and services are priced, and the system on the whole works pretty well.  Private institutions around the world also work on this principle.  So do public institutions in many places, at least where MBAs and international students are concerned (also out-of-state students in the US).

But other than that, public institutions are not permitted to charge market-based prices (if Australia ever passes its deregulation bill it will be the exception – but more on that tomorrow).  They therefore have to find some other principles on which to base prices.

One option is to ask people to pay in some kind of relation to the returns on their education.  In a pure graduate tax system (which doesn’t actually exist anywhere), this happens directly because education payments are tied to annual income.  A rough-justice version of this concept sees fees vary by field of study, according to average returns in each field.  Canadian universities superficially do this by charging higher fees in fields like medicine, dentistry, and law than in Arts and Science.  But then again, in most cases, Canada’s variable fees only kick in at the second-degree level – at the first-degree level there is actually very little variation.

Australia has shown more gumption here: since the mid-90s their version of tuition fees (i.e. HECS contributions) have divided fields of study into three “bands”, with the lowest one (paying $5,000/year) containing fields like humanities, languages and education, the middle one (roughly $7,500/year) including computer science and engineering, and the top one ($8,500/yr) including law, medicine, etc.  (Of course, they then went and altered this scheme by designating science and maths as “national priorities”, and reduced their tuition to about $4,000/yr, but whatever.)

A third option is to charge students in relation to what it costs to educate a student.  In practice, this looks a lot like charging based on returns, because the capital-intensive programs also tend to be high-return programs.  However, law and business tend to cost a little less in this variation, and Fine Arts tends to cost more.  However, lack of clarity on how to define “costs of education” makes this a difficult system to adopt.

These are all ways of varying tuition; in practice, however, there is little variation in first-degree programs at public universities around the world, apart from Australia.  The reason is fairly simple: in most places, fees are controlled directly or indirectly by government.  And where government is involved, the key principle in deciding fee levels is: “what can we get away with?”  Because for governments, tuition is less a legitimate revenue stream that institutions use to reach financial (and hence academic) goals, and more a necessary evil that must be subordinated to short-term electoral calculations.

Some Canadian governments take this idea completely meta.  When Manitoba abandoned its tuition fee freeze in 2009, it chose to tie its tuition to the mid-range of what institutions in other provinces charge.  That is to say: tuition in Manitoba is the average of what other provincial governments think they can get away with.  Alberta does the same thing on a case-by-case basis: where institutions can prove that some of their programs are under-priced compared to similar programs at other major Canadian universities, the government will grant an exception to its blanket tuition policy and allow these programs to raise tuition to match.  Somehow, this process came to be known as the “market-modifier” system, which is odd considering there appear to be no markets at work here whatsoever.

Anyways, the upshot is there are lots of possible ways to set tuition, very few of which are likely to see the light of day because governments are disinclined to give up control of the fee-setting process either to institutions or an algorithm.  C’est la vie.

January 26

King Abdullah bin Abdulaziz al-Saud

King Abdullah bin Abdulaziz al-Saud, King of Saudi Arabia for the past ten years (after effectively being regent for the ten years before that, due to his brother King Fahd’s incapacitation from stroke), died last week.  There can have been very few individuals who have had a greater effect on their country’s system of higher education.

Perhaps his best-known initiative was the creation of his eponymous institution, the King Abdullah University of Science and Technology. Opened in 2009 near Jeddah, KAUST made headlines because of its lavish construction and endowment ($20 billion worth – third in the world after Harvard and Yale) and its attempts to recruit star faculty from around the world.  KAUST to date hasn’t set the world on fire – for all the money on offer, there aren’t a lot of serious scientists interested in moving to Saudi Arabia, even if women are allowed to drive and be unveiled within the university’s heavily guarded compound – and there is some truth to the jibe that there are more buildings than professors.  But it’s early days yet, and KAUST remains an interesting strategy to try to build the elements of a knowledge economy to help the country eventually transition away from petroleum.

The outside world focused on the KAUST story because it was a big, single institution, a contained story that fit the money-to-burn Gulf Arab stereotype.  But Abdullah’s agenda wasn’t simply about KAUST.  Over the course of his (effective) 20-year reign, 36 new universities were built in Saudi Arabia.  Enrolment in universities rose nearly sixfold, from a little over 200,000 to 1,200,000, the majority of whom are women.  Gross enrolment rates went from 18 to 50.  Few countries anywhere can match that kind of record.  Perhaps even more significantly for the outside world was his creation of the King Abdullah Scholarship Program (KASP), which funded Saudis to get their education in the west, primarily the United States.  The Scholarship sends 125,000 students abroad every year at a cost of about $2 billion (Canadian universities collectively receive about 9% of those students).

With Abdullah’s death, many people wonder about the fate of KASP and KAUST: what will be their fate under King Salman?  My guess is that KAUST is considerably more vulnerable than KASP.  That may seem counterintuitive since the former has an endowment while the latter’s funding is recurring, but the politics are different.  KASP benefits a lot of middle-class Saudi families, there is much demand to go abroad for school, and in the wake of the Arab spring, Gulf monarchs tend not to cut back on popular subsidies.  KAUST may have its own massive endowment, but it still faces financial challenges if corporate donations slow.  Saudi Arabia doesn’t tax corporations, but companies that work there do get a lot of “suggestions” about what causes they should support, and in what amounts.  What causes get supported has a lot to do with the interests of whoever’s running the country; hence, a change of regime is likely to affect patterns of philanthropy.  Unlike KASP, KAUST is seen to benefit foreigners as much as it does Saudis and would therefore make an easier target.

How do we evaluate such a legacy?  The problem is that Saudi Arabia challenges many western notions about higher education.  Though we shrink from talking openly about universities’ “civilizing” function because it’s deeply uncool in a post-colonial world, the fact is most of us in the west still implicitly believe in that function.  Yet despite all these impressive increases in educational attainment – even western education – Saudi Arabia remains in our eyes a deeply uncivilized kind of place: the beheadings, the floggings, the misogyny all evoke notions of barbarity.  The spread of higher education in the country has done precious little to change that.  Whether that says more about Saudis or about higher education is an exercise for the reader.

January 23

Classroom Economics (The End)

So we spent Monday looking at the economic basics of classroom and teaching loads, and Tuesday looking at how difficult it is to improve the situation by increases in tuition or government grants.  Wednesday we saw that reducing average academic compensation (presumably via increasing the proportion of credits taught by adjuncts) can be quite effective in reducing teaching loads, while on Thursday we saw how trying to achieve a similar effect through attacking costs other than academic compensation would require enormously painful – and probably unrealistic – cuts.

What can we conclude from all this?

There is no silver bullet here.  You can’t solve everything on the revenue side because governments: i) aren’t going to fork over the stonking huge amounts of money required to change things; ii) aren’t going to permit large tuition increases; and, iii) at some point are going to put limits on the extent to which universities can escape domestic fiscal problems by becoming finishing schools for the Asian middle class.  At the same time, you can’t solve everything by decreasing average academic wages because: i) tenure; ii) unions; and, iii) casualization can’t go on indefinitely.  Finally, you can’t solve everything by cutting “fat” on the non-academic side because the size of the bloodletting would simply be too big.

So, realistically, the solution to keeping teaching loads (and hence class sizes) manageable is to work at the margins on all three, at once.  The income one is probably the easiest: even if government does not have more money, it could (as I argued back here) allow tuition to rise without students being unduly affected if it simply reformed student aid to make it more efficient and transparent.

On non-academic costs, vigilance is key.  Costs need to be kept in check.  There is a need to continually become more efficient – which probably means looking more seriously at outsourcing certain functions. Bits of IT come to mind, as do bookshops.

On academic salaries, there’s no big secret about what needs to be done.  Every time wages increase, universities either have to get more income, or increase the number of sessionals, or raise teaching loads.  That’s simple arithmetic.  To the extent an institution can keep enrolments up and get a little bit more money per student, on average, the situation can stay relatively stable indefinitely (though it isn’t going to get any better).

Where this gets tricky is where student numbers – and hence income – start to fall.  We didn’t explore that this week because our equation – X = aϒ/(b+c) – assumes that there is budget balance.  But when enrolment drops, expenditure has to drop in the medium term because the lack of students means you can’t release the pressure by increasing teaching loads.

So when you see the number of applicants to an institution drop by, say, 20% (as first-choice applications have now done at Windsor) over two years, you start to worry.  Without the option to increase loads, expenditures have to fall, and as we’ve seen, the least disruptive way to do that is to increase sessionals.  But since tenure exists and you can’t force out a professor and replace them with a sessional, that’s a marginal solution at best.  Academic compensation will have to fall: either through wage freezes, pension changes, or a reduction in the number of academic positions.  Either that or the institution will close.

There’s no sinister conspiracy here, no evil administrative plots.  It’s just math.  More people should pay attention to it.

January 22

Classroom Economics (Part 4)

Yesterday we looked at ways to get the teaching budget down.  Today, we’re going to look at the other half of the cost equation: all that overhead.  And we’re going to look at it by asking the question: how big a cut in overhead would it take to equal the effect of replacing 20% of your credit hours with sessionals (which, as we saw yesterday, reduces overall teaching loads by 17%)?

Recall the equation: X = aϒ/(b+c), where “X” is the total number of credit hours a professor must teach each year (a credit hour here meaning one student sitting in one course for one term), “ϒ” is average compensation per professor, “a” is the overhead required to support each professor, “b” is the government grant per student credit hour, and “c” is the tuition revenue per credit hour.  Given that equation, the answer to our question is simple: you need to drop overhead by 17%.  But how might one go about achieving a cut that size?

On average across Canada, universities spend about $16,300 per FTE student on things other than academic staff compensation (yes, really).  Over half of that – 54% or so – goes to non-academic staff compensation: the professional staff, the cleaners, the lab techs, the janitors, etc.  They’re all in there.  No other single item comes close.  The table below shows the full breakdown.  Most of those categories are pretty self-explanatory, except perhaps for “other” operational expenditures (which is mostly long-term space rental and property taxes, with a few miscellanies thrown in for good measure).

1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Now imagine you want to achieve your 17% reduction without firing anyone, or trying to get them to give back salary – what are your options?  Well, to start with, it’s important to acknowledge there’s a bunch of things in here that are difficult to touch.  Scholarships, for instance.  And not paying interest isn’t too smart.

So that leaves only 35.8% of the whole non-academic budget.  Squeezing 17% out of that would be pretty horrific; it would require cuts of as close to 50% as makes no odds.  What do you think our universities would look like with half the library acquisition budget gone?  Half the travel and communications budget gone?  Half the budget for light and heat gone?  It’s simply not an option.

All of this, of course, means that balancing budgets this way leaves you with very few options other than reducing labour costs.  Say you had a way to reduce your non-academic staff costs by 10% – either by wage rollbacks or layoffs, or some combination of the two: you’d still have to find a way to squeeze 20% out of the rest of the non-academic budget to make the math work.  And that would be tough.

Bottom line: there is no easy salvation here.  Any serious reduction in costs on this side will require some bloodletting in terms of staff.  That’s never easy to stomach.

My wrap-up on all this tomorrow.

January 21

Classroom Economics (Part 3)

(If you’re just tuning in today, you may want to catch up on Part 1 and Part 2)

Back to our equation: X = aϒ/(b+c), where “X” is the total number of credit hours a professor must teach each year (a credit hour here meaning one student sitting in one course for one term), “ϒ” is average compensation per professor, “a” is the overhead required to support each professor, “b” is the government grant per student credit hour, and “c” is the tuition revenue per credit hour.

I noted in Part 1 of this series that most profs don’t actually teach the 235 credit hours our formula implied. Partly that’s because teaching loads aren’t distributed equally.  Imagine a department of ten people, which would need to teach 2350 credit hours in order to cover its costs.  If just two people teach the big intro courses and take on 500 credit hours apiece, the other 8 will be teaching a much more manageable 169 credit hours (5 classes of under 35 students for those teaching 3/2).

Now, while I’m talking about class size, you’ll notice that this concept isn’t actually a factor in our equation – only the total number of credit hours required to be taught.  You can divide ‘em up how you want.  Want to teach 5 courses a year?  Great.  Average class size will be 47.  Want to teach four courses?  No sweat, just take 59 students per class instead.  It’s up to you.

When you hear professors complain about increased class sizes, this is partly what’s going on.  As universities have reduced professors’ teaching loads (to support research, natch) without reducing the number of students, the average number of students per class has risen.  That has nothing to do with underfunding or perfidious administrators; it’s just straight arithmetic.

But there is a way to get around this.  Let’s say a university lowers its normal teaching load from 3/2 to 2/2, as many Canadian institutions have done in the last two decades.  As I note above, there is no necessary financial cost to this: just offer fewer, larger courses.  Problem is, no university that has gone down this path has actually reduced its course offerings by the necessary 20% to make this work.  Somehow, they’re still offering those courses.

That “somehow” is sessional lecturers, or adjuncts if you prefer.  They’ll teach a course for roughly a third of what a full-time prof will.  So their net effect on our equation is to lower the average price of academic labour.  Watch what happens when we reduce teaching loads from 3/2 to 2/2, and give that increment of classes over to adjuncts.

(.8*150,000) + (.2*50,000) = $130,000

X= 2.27($150,000)/($600+$850) = 235

X= 2.27(130,000)/($600+$850) = 195

The alert among you will probably note that the fixed cost nature of “a” means that it would likely rise somewhat as ϒ falls, so this is probably overstating the fall in teaching loads a bit.  But still, this result is pretty awesome.  If you reduce your faculty teaching load, and hand over the difference to lower-paid sessionals, not only do you get more research, but the average teaching load also falls significantly.  Everyone wins!  Well, maybe not the sessionals, but you get what I mean.

This underlines something pretty serious: the financial problems we have lay much more on the left side of the equation than on the right side.  However much you think professors deserve to be paid, there’s an iron triangle of institutional income, salaries, and credit hours that cannot be escaped.  If you can’t increase tuition, and more government money isn’t forthcoming, then you either have to accept higher teaching loads or lower average salaries.  And if wage rollbacks among full-time staff isn’t in the cards, then average costs are going to be reduced through increased casualization.  Period.

Or almost, anyway. To date we’ve focused just on ϒ – but what about “a”?  Can’t we make that coefficient smaller somehow?

Good question.  More tomorrow.

January 20

Classroom Economics (Part 2)

Yesterday, I introduced the equation X = aϒ/(b+c) as a way of setting overall teaching loads. Let’s now use this to understand how funding parameters drive overall teaching loads.

Assume the following starting parameters:

1

 

 

 

 

 

Where a credit hour = 1 student in 1 class for 1 semester.

Here’s the most obvious way it works.  Let’s say the government decides to increase funding by 10%, from $600 to $660 (which would be huge – a far larger move than is conceivable, except say in Newfoundland at the height of the oil boom).  Assuming no other changes – that is, average compensation and overhead remain constant – the 10% increase would mean:

X= 2.27($150,000)/($600+$850) = 235

X= 2.27($150,000)/($660+$850) = 225

In other words, a ten percent increase in funding and a freeze on expenditures would reduce teaching loads by about 4%.  Assuming a professor is teaching 2/2, that’s a decrease of 2.5 students per class.  Why so small?  Because in this scenario (which is pretty close to the current situation in Ontario and Nova Scotia), government funding is only about 40% of operating income.  The size of the funding increase necessary to generate a significant effect on teaching loads and class sizes is enormous.

And of course that’s assuming no changes in other costs.  What happens if we assume a more realistic scenario, one in which average salaries rise 3%, and overhead rises at the same rate?

X= 2.27($154,500)/($660+$850) = 232

In other words, as far as class size is concerned, normal (for Canada anyway) salary increases will eat up about 70% of a 10% increase in government funding.  Or, to put it another way, one would normally expect a 10% increase in government funding to reduce class sizes by a shade over 1%.

Sobering, huh?

OK, let’s now take it from the other direction – how big an income boost would it take to reduce class sizes by 10%?  Well, assuming that salary and other costs are rising by 3%, the entire right side of the equation (b+c) would need to rise by 14.5%.  That would require an increase in government funding of 35%, or an increase in revenues from students of 25% (which could either be achieved through tuition increases, or a really big shift from domestic to international enrolments), or some mix of the two; for instance, a 10% increase in government funds and a 17% increase in student funds.

That’s more than sobering.  That’s into “I really need a drink” territory.  And what makes it worse is that even if you could pull off that kind of revenue increase, ongoing 3% increases in salary and overhead would eat up the entire increase in just three years.

Now, don’t take these exact numbers as gospel.  This example works in a couple of  low-cost programs (Arts, Business, etc.) in Ontario and Nova Scotia (which, to be fair, represent half the country’s student body), but most programs in most provinces are working off a higher denominator than this, and for them it would be less grim than I’m making out here.  Go ahead and play with the formula with data from your own institution and see what happens – it’s revealing.

Nevertheless, the basic problem is the same everywhere.  As long as costs are increasing, you either have to get used to some pretty heroic revenue assumptions (likely involving significant tuition increases) or you have to get used to the idea of ever-higher teaching loads.

So what are the options on cost-cutting?  Tune in tomorrow.

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