HESA

Higher Education Strategy Associates

Tag Archives: Graduate employment

May 16

Jobs: Hot and Not-So-Hot

Remember when everyone was freaking out because there were too many sociology graduates and not enough welders?  When otherwise serious people like Ken Coates complained about the labour market being distorted by the uninformed choices of 17-19 year-olds?  2015 seems like a long time ago.

Just for fun the other day, I decided to look at which occupations have fared best and worst in Canada over the past ten years (ok, I grant you my definition of fun may not be universal).  Using public data, the most granular data I can look at are two-digit National Occupation Codes, so some of these categories are kind of broad.  But anyway, here are the results:

Table 1: Fastest-growing occupations in Canada, 2007-2017

May 16-17 Table 1 Fastest Growing

See any trades in there?  No, me neither.  Four out of the top ten fastest-growing occupations are health-related in one way or another.  There are two sets of professional jobs – law/social/community/ government services (which includes educational consultants, btw) and natural/applied sciences) which pretty clearly require bachelor’s if not master’s degrees.  There are three other categories (Admin/financial supervisors, Technical occupations in art, and paraprofessional occupations in legal, social, etc) which have a hodgepodge of educational requirements but on balance probably have more college than university graduates.   And then there is the category retail sales supervisors and specialized sales occupations, which takes in everything from head cashiers to real estate agents and aircraft sales representatives.  Hard to know what to make of that one.  But the other nine all seem to require training which is pretty squarely in traditional post-secondary education specialties.

Now, what about the ten worst-performing occupations?

Table 2: Fastest-shrinking Occupations in Canada 2007-2017

May 16-17 Table 2 Fastest Shrinking Occupation
This is an interesting grab bag.  I’m fairly sure, given the amount of whining about managerialism one hears these days, that it will be a surprise to most people that the single worst-performing job sector in Canada is “senior management occupations”.  It’s probably less of a surprise that four of the bottom ten occupations are manufacturing-related, and that two others – Distribution, Tracking and Scheduling and Office Support Occupations – which are highly susceptible to automation are there, too.  But interestingly, almost none of these occupations, bar senior managers, have significant numbers of university graduates in them. Many wouldn’t even necessarily have a lot of college graduates either, at least outside the manufacturing and resources sectors.

Allow me to hammer this point home a bit, for anyone who is inclined to ever again take Ken Coates or his ilk seriously on the subject of young people’s career choices.  Trades are really important in Canada.  But the industries they serve are cyclical.  If we counsel people to go into these areas, we need to be honest that people in these areas are going to have fat years and lean years – sometimes lasting as long as a decade at a time.  On the other hand, professional occupations (nearly all requiring university study) and health occupations (a mix of university and college study) are long-term winners.

Maybe students knew that all along, and behaved accordingly.  When it comes to their own futures, they’re pretty smart, you know.

 

January 20

Puzzles in the youth labour market

A couple of days ago, after looking at employment patterns among recent graduate using Ontario graduate survey data, I promised a look at broader youth labour market data. I now wish I hadn’t promised that because Statistics Canada’s CANSIM database is an ungodly mess and has got significantly worse since the last time I tried to use its data. Too little of the data on employment and income allows users to focus in by age *and* education level, and even getting details down to 5-year age brackets (e.g. 20-24, 25-29), which might be useful for looking at youth labour markets, is frustratingly difficult.

(WHY CAN’T WE HAVE NICE THINGS, STATSCAN? WHY???)

Anyways.

Ok, so let’s start by looking at employment rates. Figure 1 looks at employment rates for Canadians in the 15-19, 20-24 and 25-29 age brackets since the turn of the Millennium.

Figure 1: Employment Rates by Age-group 1999-2016

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The takeaway in figure 1 is that by and large employment rates are steady except for one big hiccup in 2008-9. In that year, the employment rate for 24-29 year olds fell by about two percentage points, that for 20-24 years olds fell by three and a half percentage points, and that for 15-19 year olds by five percentage points. Not only did the size of the drop vary inversely with age, so too has subsequent performance. Employment rates for 25-29 year-olds and 20-24 year olds have held fairly steady since 2009; those for 15-19 year olds have continued to fall, and are now over seven percentage points off their 2008 peak.

Ah, you say: employment is one thing: what about hours of work? Aren’t we seeing more part-time work and less full-time work? Well, sort of.

Figure 2: Part-time Employment as a Percentage of Total Employment, by Age-group, 1999-2016

OTTSYD 2017-01-20-2

Across all age-groups, the percentage of workers who are part-time (that is, working less than 30 hours per week) rose after 2008. In the case of the 25-29 year olds, this was pretty minor, rising from 12% in 2008 to 14% today. Among the 15-19 year-olds the movement was not especially large either, rising from 70 to 74% (remember, we *want* these kids to be part-time: they’re supposed to be in school). The biggest jump was for the 20-24 group – that is, traditional-aged students and recent graduates – where the part-time labour jumped from 29% to 35%. Now some of that might be due to higher university enrolment rates (workers are more likely to be part-time if they are also studying), but at least some of that is simply a push towards increased casualization of the labour market.

So far, all of this is roughly consistent with what we saw Monday through Wednesday – which is that there was a one-time shock to employment around 2008, and that the effect is much more pronounced among younger graduates (say, those 6 months out from graduation ) than it is among older ones (say, those 24 months after graduation. What is not quite consistent, though, is what is happening to wages. Unfortunately, CANSIM no longer makes available any decent time series data on wages or income for the 20-24 or 25-29 age groups (one of these days I am going to have to stump up for a public use microdata file but today is not that day.) But it does offer  some data on what’s going on for 15-24 year olds. Sub-optimal (25-29 would be best) but still useful. Here’s what that data looks like:

Figure 3: Hourly and Weekly Wages, 15-24 year-olds, in $2016, 2001-2016

OTTSYD 2017-01-20-3

Figure 3 shows hourly and weekly wages for 15-24 year olds, in 2016 dollars. Hourly wages (measured on the right axis) grew faster than weekly wages (measured on the left axis) because average hours worked fell by 3.5% (this is the shift to part-time work we saw in figure 2). Hourly wage growth has not been as strong since 2008 as it was between 2004 and 2008, but it is still up 6% over that time. It’s probably safe to assume that the situation for 25-29 year olds is not worse than it is for 20-24 year olds. Which means we have an interesting puzzle here: wage growth for the youth cohort as a whole is positive, at least among those who have wages – but as we saw Monday and Tuesday wage growth is negative for university students. What’s going on?

There are two possibilities here. The first is that wage growth since 2008 is stronger for those without university degrees than it is for those with. With the oil/gas boom, that might have been a reasonable explanation up to 2014; it’s hard to see it still being true now. The second is the proposition advanced here earlier this week: that while university graduates may still all cluster at the right-end of the bell curve, as they encompass a greater proportion of the bell curve, the average as a whole necessarily falls.

In short: post-2008, something has happened to the labor market which makes it more difficult for young people to “launch”. We shouldn’t overstate how big this problem is: employment is down slightly, as is the proportion of employment which is full-time. But unlike previous recessions, the youth-labour market does not seem to be bouncing back – these changes seem to be permanent, which is a bit disquieting. But it’s also true that these effects are more severe among the youngest: which is exactly what you’d expect if the labour market was putting a greater emphasis on skills and experience. By the time youth get to their late 20s, the effects mostly disappear.

In other words, what we are seeing is less “failure to launch” than “delays in the launch”. To the extent anything has changed, it’s that the transition to the labour market is on average a little bit rougher and a little bit slower than it used to be, but that’s likely as much to do with the expansion of access to university as it is a skills-biased change in the labour market.

January 18

More Bleak Data, But This Time on Colleges

Everyone seems to be enjoying data on graduate outcomes, so I thought I’d keep the party going by looking at similar data from Ontario colleges. But first, some of you have written to me suggesting I should throw some caveats on what’s been covered so far. So let me get a few things out of the way.

First, I goofed when saying that there was no data on response rates from these surveys. Apparently there is and I just missed it. The rate this year was 40.1%, a figure which will make all the economists roll their eyes and start muttering about response bias, but which anyone with field experience in surveys will tell you is a pretty good response for a mail survey these days (and since the NGS response rate is now down around the 50% mark, it’s not that far off the national “gold standard”).

Second: all this data on incomes I’ve been giving you is a little less precise than it sounds. Technically, the Ontario surveys do not ask income, they ask income ranges (e.g. $0-20K, $20-40K, etc). When data is published either by universities or the colleges, this is turned into more precise-looking figures by assigning the mid-point value of each and then averaging those points. Yes, yes, kinda dreadful. Why can’t we just link this stuff to tax data like EPRI does? Anyways, that means you should probably take the point values with a pinch of salt: but the trend lines are likely still meaningful.

Ok, with all that out of the way, let’ turn to the issue of colleges. Unfortunately, Ontario does not collect or display data on college graduates’ outcomes the way they do for universities. There is no data around income, for instance. And no data on employment 2 years after graduation, either. The only real point of comparison is employment 6 months after graduation, and even this is kind of painful: for universities the data is available only by field of study; for colleges, it is only available by institution. (I know, right?) And even then it is not even calculated on quite the same basis: universities include graduates with job offers while the college one does not. So you can’t even quite do an apples-to-apples comparison, even at the level of the sector as a whole. But if you ignore that last small difference in calculation and focus not on the point-estimates but on the trends, you can still see something interesting. Here we go:

Figure 1: Employment Rates 6 months after Graduation, Ontario Universities vs. Ontario Colleges, by Graduating Cohort, 1999-2015

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So, like I said, ignore the actual values in Figure 1 because they’re calculated in two slightly different ways; instead, focus on the trends. And if you do that, what you see is (a blip in 2015 apart), the relationship between employment rates in the college and university sector looks pretty much the same throughout the period. Both had a wobble in the early 2000s, and then both took a big hit in the 2008 recession. Indeed, on the basis of this data, it’s hard to make a case that one sector has done better than another through the latest recession: both got creamed, neither has yet to recover.

(side point: why does the university line stop at 2013 while the college one goes out to 2015? Because Ontario doesn’t interview university grads until 2 years after grad and then asks them retroactively what they were doing 18 months earlier. So the 2014 cohort was just interviewed last fall and it’ll be a few months until their data is released. College grads *only* get interviewed at 6 months, so data is out much more quickly)

What this actually goes is put a big dent in the argument that the problem for youth employment is out-of-touch educators, changing skill profiles, sociologists v. welders and all that other tosh people were talking a few years ago. We’re just having more trouble than we used to integrating graduates into the labour market. And I’ll be taking a broader look at that using Labour Force Survey data tomorrow.

January 17

Another Lens on Bleak Graduate Income Data

So, yesterday we looked at Ontario university graduate employment data (link to: previous).  Today I want to zero in a little bit on what’s happening by field of study.

(I can hear two objections popping up already.  First; “why just Ontario”?  Answer: while Quebec, Alberta, British Columbia and the Maritimes – via MPHEC – all publish similar data, they all publish the data in slightly different ways, making it irritating (and in some cases impossible) to come up with a composite national figure.  The National Graduate Survey (NGS) in theory does this, but only every five years but as I explained last week has made itself irrelevant by changing the survey period.  So, in short, I can’t do national, and Ontario a) is nearly half the country in terms of university enrolments and b) publishes slightly more detailed data than most.  Second, “why just universities”?  Answer: “fair point, I’ll be publishing that data soon”.

Everyone clear? OK, let’s keep going).

Let’s look first at employment rates 6 months after graduation by field of study (I include only the six largest – Business/Commerce, Education, Engineering, Humanities, Physical Sciences and Social Sciences – because otherwise these graphs would be an utter mess), shown below in Figure 1.  As was the case yesterday, the dates along the x-axis are the cohort graduation year.

ottsyd-20170116-1

Two take-aways here, I think.  The first is that the post-08 recession really affected graduates of all fields more or less equally, with employment rates falling by between 6 and 8 percentage points (the exception is humanities, where current rates are only four percentage points below where they were in 2007).  The second is that pretty much since 2001, it’s graduates in the physical sciences who have had the weakest results.

OK, but as many in the academy say: 6 months isn’t enough to judge anything.  What about employment rates after, say, 2 years?  These are shown below in Figure 2.

ottsyd-20170116-2

This graph is smoother than the previous one, which suggests the market for graduates with 2 years in the labour market is a lot more stable than that for graduates with just 6 months.    If you compare the class of 2013 with the clss of 2005 (the last one to completely miss the 2008-9 recession), business and commerce students’ employment rates have fallen only by one percentage point while those in social sciences have dropped by six percentage points, with the others falling somewhere in between.  One definite point to note for all those STEM enthusiasts out there: there’s no evidence here that students in STEM programs have fared much better than everyone else.

But employment is one thing; income is another.  I’ll spare you the graph of income at six months because really, who cares?  I’ll just go straight to what’s happening at two years.

ottsyd-20170116-3

To be clear, what figure 3 shows is average graduate salaries two years after graduation in real dollars – that is, controlling for inflation.  And what we see here is that in all fields of study, income bops along fairly steadily until 2007 (i.e. class of 2005) at which point things change and incomes start to decline in all six subject areas.  Engineering was down, albeit only by three percent.  But income for business students was down 10%, physical sciences down 16%, and humanities, social sciences and education were down 19%, 20% and 21%, respectively.

This, I shouldn’t need to emphasize, is freaking terrible.  Actual employment rates (link to: previous) may not be down that much but this drop in early graduate earnings is  pretty disastrous for the majority of students.  Until a year or two ago I wasn’t inclined to put a lot of weight on this: average graduate earnings have always popped back after recessions.  This time seems to be different.

Now as I said yesterday, we shouldn’t be too quick to blame this on a huge changes economy to which institutions are not responding; it’s likely that part of the fall in averages comes from allowing more students to access education in the first place.  As university graduates take up an increasing space on the right-hand side of an imaginary bell-curve representing all youth, “average earnings” will naturally decline even if there’s no overall change in the average or distribution of earnings as a whole.  And the story might not be as negative if we were to take a five- or ten-year perspective on earnings.  Ross Finnie has done some excellent work showing that in the long-term nearly all university graduates make a decent return (though, equally, there is evidence that students with weak starts in the labour force have lower long-term earnings as well through a process known as “labour market scarring”).

Whatever the cause, universities (and Arts faculties in particular) have to start addressing this issue honestly.  People know in their gut that university graduates’ futures in general (and Arts graduates in particular) are not as rosy as they used to be. So when the Council of Ontario puts out a media release, as it did last month, patting universities on the back for a job well-done with respect to graduate outcomes, it rings decidedly false.

Universities can acknowledge challenges in graduate without admitting that they are somehow at fault.  What they cannot do is pretend there isn’t a problem, or shirk taking significant steps to improve employment outcomes.

January 16

Ever-bleaker Graduate Employment Data?

So just before I quit blogging in December, the Council of Ontario Universities released its annual survey of graduate outcomes, this time of the class of 2013.  The release contained the usual platitudes: “future is bright”, “vast majority getting well-paying jobs”, etc etc.   And I suppose if one looks at a single year’s results in isolation, one can make that case.  But a look at longer-term trends suggests cause for concern.

These surveys began at the behest of the provincial government seventeen years ago.  Every graduating cohort is surveyed twice: once six months after graduation and once two years after graduation.  Students are asked questions about their employment status, their income and about the level of relationship between their job and their education.  COU publishes only high-level aggregate data, so we don’t know about things like response rates, but the ministry seems pleased enough by data quality, so I assume it’s within industry standards.

Figure 1 shows employment rates of graduates six months and two years out.  At the two-year check point, employment rates fell by four points in the immediate wake of the 2008-9 recession, (be careful in reading the chart: the x-axis is the graduating class, not the year of the survey, so the line turns down in 2006 because that’s the group that was surveyed in 2008).  Since then it has recovered by a little more than a point and a half, though further recovery seems stalled.  At the six-month point, things are much worse.  Though employment rates at this point are no longer falling, they remain stubbornly seven percentage points below where they were pre-recession.

Figure 1: Employment Rates, Ontario University Graduates, 6 Months and 2 Years Out, by Graduating Class, 1996-2013

OTTSYD 20170115-1

If you want to paint a good story here, it’s that employment rates at 2 years out are still within three percentage-points of their all-time peak, which isn’t terrible.  But there doesn’t seem much doubt that students are on average taking a bit longer to “launch” than they used to; employment rates six months out seem to have hit a new, and permanently lower floor.

Now, take a look at what’s happening to starting salaries.  As with the previous graph, I show results for at both the six-month and the two-year mark.

 

 Figure 2: Average salaries, Ontario University Graduates, 6 Months and 2 Years Out, by Graduating Class, 1996-2013, in $2016

OTTSYD 20170115-2

What we see in Figure 2 is the following:  holding inflation constant, during the late 1990s, recent graduates saw their incomes grow at a reasonably rapid clip.  For most of the 2000s, income was pretty steady for graduates two years out (less so six months out).  But since the 2008 recession, incomes have been falling steadily for several years; unlike the situation with employment rates, we have yet to see a floor, let alone a bounceback.  Real average incomes of the class of 2013 six months after graduation were 11% lower than those of the class of 2005 (the last fully pre-recession graduating class); at 2 years out the gap was 13%.  Somehow these points did not make it into the COU release.

That, frankly, is not good.  But it seems to me that we need to hold on a little bit before hitting panic buttons about universities being a bad deal, not being relevant to shifting labour market, etc, etc.  Sure, the drop-off in both employment rates and incomes started around the time of the recession and so it’s easy to create a narrative around changed economy/new normal, etc etc.  But there’s something else that probably playing a role, and that’s an increase in the supply of graduates.

 

Figure 3: Number of Undergraduate Degrees Awarded, Ontario, 1999-2013

OTTSYD 20170115-3

The other big event we need to control for here is the massive expansion of access to higher education.  In 2003, the “double-cohort” arrived on campus and that forced government to expand institutional capacity, which did not subsequently shrink.  Compared to the year 2000, the number of graduates has increased by over 50%; Such an expansion of supply must have had some effect on average outcomes. It’s not simply that there are more students competing for jobs – something one would naturally assume would place downward pressure on wages – but also, the average quality of graduates has probably dropped somewhat.  Where once graduates represented the top 20% of a cohort in terms of academic ability, now they probably represent the top 30% or so.  Assuming one’s marginal product in the labour market is at least loosely tied to academic ability, that would also predict a drop in average post-graduation incomes.  To really get a sense of what if anything has changed in terms of how higher education affects individuals’ fortunes in the labour market, you’d want to measure not average income vs. average income, but 66th percentile of income now vs. 50th percentile of income fifteen years ago.  Over to you, COU, since you could make the microdata public if you wanted to.

In short, don’t let institutions off the hook on this, but recognize that some of this was bound to happen anyway because of access trends.

More graduate income data fun tomorrow.

July 25

The low-wage graduate problem

The week before last, the Canadian Centre for the Study of Living Standards (CSLS) put out a report (available hereon trends on low-paid employment  in Canada from 1997 to 2014 (meaning full-time jobs occupied by 20-64 year olds where the hourly earnings are less than 66% of the national median).  It’s an interesting and not particularly sensationalist report based on Labour Force Survey public-use microdata; however one little factoid has sent many people into a tizzy.  Apparently, the percentage of people with Master’s or PhDs who are in low-wage jobs (where the hourly earnings are less than two-thirds of the national median) had jumped from 7.7% to 12.4%.  This has led to a lot of commentary about over-education, yadda yadda, from the Globe and Mail, the CBC, and so on.

This freak-out is a bit overdone. I won’t argue that the study is good news, but I think there are some things going on underneath the numbers which aren’t given enough of an airing in the media.

First of all, as CSLS explains in great detail, the two important findings are that the incidence of low-wage work in the economy has stayed more or less stable, and second, Canadians on the whole are a lot more educated than they used to be.  This leads to a compositional paradox: even though all seven levels of education saw increases in the incidence of low-wages (see Figure below), overall the fraction of Canadians with low wage jobs dropped ever-so-slightly from 27.9% in 1997 to 27.6% in 2014.

ottsyd 20160721-1

Now you have to be careful about interpretation here, particularly with respect to charges of “over-education”.  Yes, the proportion of grads in low-wage jobs is going up.  But the average wage income of university graduates is actually increasing: between 1995 and 2010, it rose by 6% after inflation.  And that’s while the number of people in the labour force with a university degree increased by 94%, and the proportion of the labour force with a university degree jumped from 19.3% to 28.7% (I would break out data on Masters/PhD specifically if I could, but public Statscan data does not separate Bachelors from higher degrees). 

What that tells us is that the economy is creating a lot more high-paying jobs which are being filled by an ever-expanding number of graduates.  But at the same time, more graduates are in low-wage jobs, which suggests that while averages are increasing, so is variance around the mean.

Another factor at work here is immigration.  Since the mid-1990s, the number of immigrants over 25 with university degrees has increased from 815,000 (23.2% of all degree holders) to 1.87 million (33% of all degree holders).  It’s not clear how many of those have graduate degrees (thanks Statscan!) but I think it’s reasonable to assume, given the way our immigration points system works, that the proportion of immigrants with advanced degrees is even higher.

The problem is that immigrants with degrees – particularly more recent immigrants – have a really hard time in the Canadian labour market, particularly at the start (see a great Statscan paper on this here).  To some extent this is rational because the degrees and the skills they confer are genuinely not compatible (see my earlier post on this), and to some extent it reflects various forms of discrimination, but that’s not the point here.  There are over one million new immigrants with degrees over the past fifteen or so years, many of them from overseas institutions.  The CSLS-inspired freak-out is about the fact that over the past 17 years the number of degree-holders has increased by 450,000 (of which 130,000 are at the Master’s/PhD level).  Simple logic suggests that most of the problem people are seeing in the CSLS data is more about our inability to integrate educated immigrants than it is about declining returns to education among domestic students.  I know the data CSLS uses doesn’t allow them to look at the results by where a degree was earned, but I’d bet serious money this is the crux of the problem.

So, you know, chill everybody.  Canadian graduates still do OK in the end.  And remember that comparisons of educational outcomes over time that don’t control for immigration need to be taken with a grain of salt.

May 02

What’s Going On With College Graduates in Ontario?

I see that Ken Coates and Bill Morrison have just written a new book  called Dream Factories: Why Universities Won’t Solve The Youth Jobs Crisis.  I haven’t read it yet, but judging by the title I’d assume that it makes pretty much the same argument Coates made back in this 2015 paper  for the Canadian Council of Chief Executives, which in effect was “fewer university students, more tradespeople!” (my critique of this paper is here)

With the fall in commodity prices, it’s an odd time to be making claims like this (remember when we had a Skills Gap?  When’s the last time you heard that phrase?).  There’s no evidence based on wages data that trades-related occupations are experiencing greater growth that those in the rest of the economy – since 2007, wages in these occupations have grown at exactly the same rate as the overall economy.  True, occupations in the natural resource sector did experience higher-than-average growth between 2010 and 2014, but unsurprisingly they underperformed the rest of the economy in 2015.  (see figure 1).  More to the point, perhaps, these jobs aren’t a particularly large sector of the economy – if you exclude the mostly seasonal agricultural harvesting category, Canada only has about 265,000 workers in this field.  That’s less than 1.5% of total employment.

Figure 1: Real Wage Increases by Occupation, Canada, 2007-2015, 2007=100

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Source: CANSIM

More generally, though, the assumption of Coates and those like him is that in the “new” post-crisis  economy college graduates have qualitatively different (and better) outcomes than university graduates, too.  But a quick look at the actual data suggests this isn’t the case.  Figure 2 shows employment rates 6-months out of college graduates in Ontario over the past decade.  Turns out college graduates have experience more or less the same labour market as university students: an almighty fall post-Lehmann brothers and no improvement thereafter.

Figure 2: Employment Rates of College Graduates, Ontario, 2005-2015

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Source: Colleges Ontario Key Performance Indicators

The decline in employment rates can’t really be described as a regional phenomenon, either.  There is not a single college which can boast better employment rates today than it had in 2008: most have seen their rates fall by between 4 and 7 percentage points.  The worst performer is Centennial College, where employment rates have fallen by 13 percentage points; one wonders whether Centennial’s performance has something to do with the very rapid growth in the number of international students it has started accepting in the last decade.

Figure 3: Change in Employment Rates 2008-2015

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Source: Colleges Ontario Key Performance Indicators

So what’s going on here?  Is there something that’s changed in college teaching?  Is it falling behind the times?  Well, not according to employers.  Satisfaction rates among employers stayed rock-solid over the period where employment rates fell; and although there has been a slight decline  in the last couple of years, the percentage saying they are satisfied or very satisfied remains over 90%.  Graduate satisfaction fell a bit during the late 00s when employment rates fell, but they too remain very close to where they were pre-crisis.

Figure 4: Employer & Student Satisfaction Rates for College Graduates, Ontario, 2005-2015

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Source: Colleges Ontario Key Performance Indicators

My point here is not that colleges are “bad” or universities are “better”.  Rather, my point is that if you measure the success of any part of the post-secondary system exclusively by employment rates, then you’re basically hostage to economic cycles.  Some parts of the cycle might make you look good and others might look bad; regardless, it’s largely out of your hands. So, maybe we should stop focusing so much on this.  And we should definitely stop pretending colleges and universities are different in this respect.

April 14

A New Deal

Yesterday, I noted that  for the last few years provincial governments have refused to either increase funding to PSE institutions to keep up with inflation, or give institutions latitude to raise tuition to make up the difference. Effectively, provincial governments seem a lot more concerned with ensuring that post-secondary education is cheap than with ensuring that it continues to receive real increases in income.

There are competing opinions about why this is the case. My view is simply that few provincial governments see much political return in allowing institutions to increase fees and/or increasing government grants – which is another way of saying the present value proposition for undergraduate education is not very attractive. I would love to see more evidence about this. Imagine if university and college government relations-types would actually go straight up to MLAs/MPPs/MNA/MHAs and say “what is it we could do to get you to spend more money/allow us to raise tuition”? But they seem not to be doing that (or if they are, the answers are disturbing enough that they are not telling the rest of the community). I’m going to go with Occam’s razor here and stick with: they aren’t buying what the sector is selling at the price the sector wishes.

So what to do? Well, broadly, there are two choices.

The first is to do nothing. Don’t change a thing. Avoid the hard questions and the hard trade-offs and keep telling each other we just need to tell better stories. The result will be years of slow decline. To be fair, some people may prefer this to large-scale change. Fair enough. That’s a defensible position. After all, we could drop twenty percent of real dollars per student and still only be back where we were in the late 1990s. It’s unpleasant, but not the end of the world.

The second is to face up to why public support for new money in post-secondary education money has been dwindling. I don’t have any special insight into this but my guess would be that the cause is rooted in some mix of

1) A perception that salaries at post-secondary institutions are too high. To take one example, when the Windsor Faculty Union gets militant starts threatening strikes despite  an average salary of over $134,000  in one of the country’s least expensive housing markets, you have a perception problem. The same issue arises when universities continue to add senior non-academic staff positions at salaries over of over $100,000, or when a president double-dips his or her salary. In Ontario, the number of university and college employees in the sunshine list has gone from 1190 and 39 (respectively) to 17,065 and 4,910. The numbers will differ a bit across Canada but not much. And yes, that’s not a completely fair comparison because the cutoff line hasn’t been adjusted for the ~50% inflation over the same period. But public perception is not always fair. The reality is that the public looks at institutional salaries and it sees fat

2) A perception that undergraduates – in arts and sciences at least – are a low priority to institutions. There are too many stories of undergrads stuffed into 1,000 seat auditorium, taught by sessionals for half their degree, or finding required courses unavailable due to either size-cap or simply disappearing from the calendar for a semester. This is unfair to colleges, because frankly they do a whole lot better than universities in terms of keeping education at a human scale, but what universities do in lower-year infects a lot of the public perception about PSE in general.

3) A perception that they are not preparing students for the labour force. This one drives many in universities round the bend, because there are lots of disciplines which are not designed to lead to particular careers. But that’s not the issue. Majors are majors and careers are careers – they don’t need to line up and in many cases they shouldn’t. But according to over 80% of students (and probably around 100% of legislators) the reason students and governments pay for post-secondary education is to help students get better jobs. Institutions can accomplish this through a number of different means: providing experiential learning (like, actually provide more, not just the exercise in re-labeling I’m seeing at many universities), building more explicit assessment of communication, team-work and critical thinking skills into the curriculum, and generally treating learning outcomes and career transitions as if they mattered. Colleges are in some respects better than universities at this, but even there many programs don’t have direct labour-market transitions (anyone looked at placement rates in Police Foundations programs lately)

4) A perception that PSE Institutions are not transparent with data. This is undeniably true. I don’t think I need to elaborate on this.

Regaining a measure of public trust will almost certainly be a prerequisite for increases in public investment. Universities and colleges are going to need to make changes – fairly dramatic ones, I think – in these four areas. If I were in university government relations, I’d be field-testing ideas with politicians, to see what it would take to create a New Deal for post-secondary education. What if institutions froze salaries over $100,000, shrank undergraduate class-sizes, revamped curricula to make them more outcomes-focused and became much more transparent with data? Would that be enough to convince the public that what was on offer was a better, more valuable product, one worth investing in?

I don’t know. But it’s worth asking. Because that other option, the long, slow, decline option, looks pretty unappealing.