HESA

Higher Education Strategy Associates

Tag Archives: STEM

September 05

Did CIBC Really Just Call for Lower Tuition?

Last week, HuffPost ran a story highlighting a newsletter from CIBC Economics about higher education.  It was actually a pretty meandering letter (CIBC Economics pieces on higher education are usually notable for their interesting use of data and somewhat shallow understanding of actual policy – here’s an earlier example).  The newsletter touched on a number of issues around educational supply and demand, but what HuffPost glommed on to was what a point about tuition in STEM programs and led with the headline “CIBC argues against “Free Market” education, calls for lower tuition”.

So, true or false?  Is CIBC joining CFS on the barricades?

Well, sort of.  What the newsletter actually said, after noting with approval that enrolments in STEM programs were rising (indicating, in their view, greater student responsiveness to economic signals) and that tuition fees are rising faster in high-demand programs such as Engineering, was:

(This) price appreciation can slow or even derail the positive momentum observed in recent enrolment trends. If Canada wants to have more graduates in STEM or any high-paying field, the country needs to work to make it affordable. This type of pricing only exacerbates already ingrained income inequalities across the country.

So, two issues here.  The first is that contrary to what HuffPost implied, CIBC is not blanket anti-tuition fees.  It’s against higher tuition fees in STEM programs (particularly Engineering) because it likes STEM programs (particularly Engineering) and is under the impression that lower tuition will attract more students to the fields.  HuffPost’s headline was thus misleading at best.

But there’s a second issue, too; namely, that CIBC’s argument is pretty much bollocks. Here are four reasons why:

First: it’s flat-out wrong about the nature of the problem.  The problem of filling more engineering spots was always about supply, never about demand.  Engineering is an expensive discipline and ramping up the number of spots is expensive and in the absence of new money from government, funds basically have to be wrung out of the system through various types of program/admin savings and retirements.  That takes time.  And it’s this, more than changes in student demand, that account for the lag in enrolments.  I know CIBC is used to markets that clear, but higher education is not one of those markets and they shouldn’t analyse it as if it were.

Second: Because adding Engineering spots costs money, fees are part of the solution, not part of the problem.  If you reduced fees in Engineering, I guarantee you there would be fewer spots.  And how would that help?

Third: there’s zero evidence that increasing fees, in the context of a fairly generous student aid system where grants are significant and loans are easily available, have had or will have any noticeable effect on demand. Indeed, as the paper itself notes, these programs are growing in demand as fees rise.  It’s a Yogi Berra-esque “nobody goes there anymore, it’s too crowded” kind of argument.

Fourth: it’s wrong on equity grounds.  These are high-demand, high-reward occupations.  Why in God’s name would we want to increase private rates of return on these, when demand for spaces in these programs are already in excess of supply?  That would just increase windfall gains to the future wealthy.

In short: HuffPost exaggerated its headline.  But CIBC did make a suggestion about reducing tuition, one that suggests they don’t pay a whole lot of attention to the actual underlying dynamics of higher education beyond throwing a stat-heavy newsletter together on the subject once a year.

Do better, guys.

March 31

The Meaning of Zero

I’ve had a lot of time over the past week to think about the federal budget. And the more I think about it, the more baffled I am about the decision to completely stuff the granting councils. I think it is either a sign of real political ineptness, or that something pretty awful is in the pipeline.

It’s not as though the Liberals are averse to spending on Science, per se. The budget dropped hundreds of millions of dollars on Artificial Intelligence, Cleantech, Superclusters, what have you. And it’s not as though they have a problem with that money going to college and universities: the AI money was clearly headed to McGill, Toronto and Alberta, winning supercluster applications are going to need universities as partners (in a rational world they should all have also polytechnics/colleges to provide technical skills training as well, but I’m not totally convinced Industry Canada understands this yet).

So why not the granting councils?

Yeah, yeah, don’t say it: the Naylor Report. Because they are waiting for the Naylor Report (which has mysteriously disappeared) and they don’t want to spend any money until it’s out because there might be a big shake-up.

(Related note: the Science Minister, Kristy Duncan, was on my Ottawa-Toronto flight this week. I asked her when the Naylor Report would be published. She said read page 88 of the budget [which says the report will be released “in the coming months]. I asked what was taking so long. She said they had just had so many consultations, it took time to read them all. I said yeah, but Naylor submitted the report on time in December, right? She said – and I quote – “well, that’s a position”. Make of this what you will, but for me at least it did not dispel the impression that games are being played.)

The problem with this thesis is that imminent future program change wasn’t a barrier to spending in some other program areas. Youth Employment Services and the Post-Secondary Student Support Program, both got very significant increases in their budgets despite the fact that the budget indicated that both would be subject to change in the near future. In those cases, the budget was written so as to show a budget bump for two years and two years only, to indicate that the government didn’t think the old structures would still be around.

So why did the government push for temporary budget boosts in other areas but not the councils? I am not sure, but I don’t see a credible answer that says “once Naylor is published the taps will flow”. I think a more likely answer is this: maybe this government doesn’t actually like granting councils as a policy tool any more than the last one did. No, there’s no “war on science” – though frankly, if it were a Conservative government that had hidden the Naylor Report and given the councils 0%, I’m pretty sure we’d be hearing that phrase 24/7.   

But I think it’s dawning on people that federal disenchantment with granting councils is not a partisan thing. The Chretien/Martin government may eventually have been good to councils (1995 budget excepted), but they also set up and funded a whole bunch of different science agencies (Brain Canada, Genome Canada, etc) precisely because they thought they knew better than the councils where science money should be spent. The Harper government wasn’t much into creating new agencies, yet was pretty consistent in funding big science projects every year outside the council structure.

One last piece of data: Universities Canada couldn’t even muster up a word on the councils’ behalf on budget night – it was all “yay MITACS and yay future Naylor report”. Seriously, their press release was embarrassing. Possibly someone in government leaned on them to give positive publicity “or else” (this has been known to happen), but possibly also that in the grand scheme of things, as long as money is coming in via clusters or AI or whatever, university administrations don’t give two hoots about the councils either. And if they don’t, why would the government?

From all of this I draw two conclusions.

One, even if the Naylor Report does result in more money for Science (and I’m not sure we can take that for granted), it’s not obvious that the councils will be the recipients of the money. The belief in Ottawa that granting councils “don’t get the job done” is deep; there is a bipartisan consensus that politicians and senior public servants, collectively, can manage the science enterprise better than scientists.

Two, Universities Canada is apparently deeply comfortable with this situation, even if not all its members are. For there to be a change in policy direction, someone is going to need to challenge the prevailing science discourse directly in Ottawa. And if it Universities Canada isn’t going to do it, it will have to be done by scientists themselves organizing and representing themselves independently in Ottawa. Sure, CAUT claims to do this, but ask a random sample of active scientists if they think this is the right vehicle for Science representation and you’d probably struggle to get into double-digits. Scientists themselves have to organize this fight, and quickly.

Three, it’s possible I’m entirely mistaken about this. Maybe the government just goofed in its messaging and there really is a pot of gold at the end of the Naylor rainbow, and Universities Canada’s behind-the-scenes work (of which I assume there is a great deal) will pay off handsomely. But honestly, at this point: would you bet on that?

March 29

Conflicting Views on Research Funding

Every year on budget night, we at HESA Towers publish a graph tracking granting council expenditures in real dollars.  This year it looks like this:

Tri-council Funding Envelopes

Research Council Funding.png

Some people really like the graph and pass it around and re-tweet it because it shows that whatever governments say about their love for science and innovation, it’s not showing up in budgets.  Others (hi Nassif!) dislike it because it doesn’t do justice to how badly researchers are faring under the current environment.  Now, these critics have a point, but I think some of the criticism misunderstands why government funds research in the first place.

The critique of that graph usually makes some combination of the following points:

  1. Enrolments have gone way up over the past fifteen years, so there are more profs and hence more people needing research grants.
  2. At some councils, at least, the average grant size is increasing, sometimes quite significantly.  That’s good for those who get grants, but it means the actual number of awards is decreasing at the same time as the number of people applying is increasing.
  3. In addition to an increasing number of applicants, the number of applications per applicant also seems to be increasing, presumably as a rational response to increasing competition (two lottery tickets are better than one!).

Now, from the point of view of researchers, what all this means is that “steady funding in real dollars” is irrelevant.  On the ground, faculty are having to spend more time on grant proposals, for fear of not receiving one.  The proportion receiving awards is falling, which has an effect on scientific progression, particularly when it happens to younger faculty.  So it’s easy to see why the situation has academic scientists in a panic, and why they’d prefer a graph that somehow shows how applicant prospects of receiving grants are nosediving.   And that graph would as be as undeniably true as the one we publish.

But, from the perspective of Ottawa, I think the answer might well be: “not our problem”.

Here’s why.  The main reason governments get into the research game is to solve a market failure.  The private sector can’t capture all the benefits of basic research because of spillovers, so they underinvest in it.  Therefore, governments invest to fill the gap.  This has been standard economic theory for over 50 years now.

So, to be blunt, government is there to buy a particular amount of science that is in the public interest given corporate underinvestment.  It is not there to provide funds so that the academic career ladder works smoothly.

Provinces and universities decided to hire more science profs to deal with a big increase in access?  Great!  But did anyone ask the feds if they’d be prepared to backstop those decisions with more granting council funds?  Nope. They just assumed the taps would keep flowing.  Academia decided to change the rules of pay and promotion in such a way that emphasized research, thus creating huge new demand for more research dollars.  Fantastic!  But did anyone ask the feds to see how they’d cope with the extra demand?  Nope.  Just hope for the best.

There’s a case, of course, to say that the federal government, via the granting councils, should be more concerned than it is with the national pipeline for scientific talent.  What’s happening right now could really cause a lot of good young scientists to either flee their careers or their country (or both), and that’s simply a waste of expensively-produced talent.  But for the feds to thoroughly get into the business of national science planning requires provinces and institutions to give the councils a more direct role in institutional hiring decisions and the setting of tenure standards.  I bet I can guess how most people would feel about that idea.

So could the government put more money into granting councils?  Sure.  Could some councils make things better by reversing their Harper-era decisions to go with larger average grant sizes?  Yes, obviously.  But let’s remember that at least part of the problem is that institutions and academics have taken a lot of decisions over the past twenty years about what research and scientific careers should look like with very little thought to the macro fiscal implications, under the assumption that the feds and the councils would be there to bail them out.

That needs to change, too.

February 28

The “Not Enough Engineers” Canard

Yesterday I suggested that Ottawa might be as much of the problem in innovation policy as it is the solution.  Today I want to make a much stronger policy claim: that Canada has a uniquely stupid policy discourse on innovation.   And as Exhibit A in this argument I want to present a piece posted over at Policy Options last week.

The article was written by Kat Nejatian, a former staffer to Jason Kenney and now CEO of a payment technology company (OVERCONFIDENT TECH DUDE KLAXON ALERT).  Basically the piece suggests that the whole innovation problem is a function of inputs: not enough venture capital and not enough engineers.  Let me take those two pieces separately.

First comes a claim that Canada’s Venture Capital funding is following further and further behind the United States.  He quotes a blog post from Wellington Financial saying: American venture-capital-backed companies raised US$93.37 per capita in 2006, while in Canada we raised US$45.76 per capita. Nearly a decade later, in 2015, US companies had doubled their performance, raising an average of US$186.23 per capita, while Canadian companies had only inched up to US$49.42.

There are two problems here.  First, these figures are in USD at current exchange rates.  You may remember that 2006 was an extraordinarily good year for the Canadian dollar, and 2015 less so, so this isn’t the best comparison in the world.  Second, they in no way match up with other published data on venture capital as a percentage of GDP.  The reference years are different, but the Conference Board noted that the VC funding as a percentage of GDP grew in Canada from .06 to .1% of GDP between 2009 and 2013, and now stands second in the world only to the US (the US grew from .13% to .18% while all of Europe fell back sharply).  And Richard Florida noted in The Atlantic that in terms of VC funding per capita, Toronto is the only non-American city which cracks the world’s top 20.  I am not sure what to make of these differences; I expect some of it has to do with definitions of venture capital (early-stage vs. late-stage for example).  But looking at more than one data point throws Nejatian’s hypothesis into doubt.

But the bigger whopper in this article has to do with the claim that Canada does not educate enough engineers.  Now forget the fact that the number of engineering graduates has very little to do with success in innovation, even if you define innovation a narrowly as Nejatian does (i.e. as tech and nothing else).  His numbers are simply and outrageously wrong.  He claims Canada produced only 12,000 new Engineering grads; in fact, the number of undergraduate degrees awarded in Architecture & Engineering in 2014 was 18,000, and that’s excluding math and computer science (another 5,400), not to mention new graduate degrees in both those areas (another 11,700).  He claims the UK produces 3.5 times the number of engineers per capita that Canada does.  It doesn’t; there is a gap, but it’s not very big – 9% of their degrees go to engineers compared to 8% of ours (see figure below).  He repeats the scare claim – demolished long ago by Vivek Wadhwa among others – that India is going to eat our lunch because it graduates 1.5 million engineers per year.  This argument needs to go back to 2006 where it belongs: only a tiny percentage of these engineers are of the calibre of North American E-schools, and one recent Times of India  piece suggested that 93% of them were not actually employable (which sounds like an exaggeration but still points to a significant underlying problem).

Figure 1: Science & Engineering Degrees as % of Total Degrees Awarded, Selected OECD Countries

OTTSYD 2017-02-27-1

(See what I mean?  The US has the smallest percentage of undergraduate degrees in engineering and yet it leads everyone else in tech…yet apparently that doesn’t matter to Nejatian – all that matters is MOAR ENGINEERS.  I mean, if we increase our proportion of degrees in engineering by about 60% we could be as innovative as…Italy?)

I could go on, but you get the picture.  This is a terrible argument using catastrophically inaccurate data and yet it gets a place in what is supposed to be our country’s premier publication on public policy.  It’s appalling.  But it fits with the way we talk about innovation in this country.  We focus on inputs rather than processes and relationships.  We see a lack of inputs and immediately try to work out how to increase them rather than asking i) do these inputs actually matter or ii) why are they low in the first place (actually, the only redeeming feature about this article is that it doesn’t make any recommendations, which given the quality of the analysis is really a blessing for all concerned).

Could Canada do with a few more engineers?  Probably.  It’s the one field of study where incomes of new graduates are still rising in real terms, which suggests the demand could support a greater supply.  But the causal link between Engineers and innovation is a vast oversimplification.  If we want better policy in this country, we need to start by improving the quality of the discourse and analysis.  Policy Options has done us all a disservice by letting this piece go out under their name.

September 30

Fields of Study: Some International Comparisons

Stop me if you’ve heard this one before: “We really need to have more STEM grads in this country.  Really, we ought to be more like Germany or Japan – fewer of these ridiculous philosophy degrees, and more of those lovely, lovely engineers and scientists.”

Personally, I’ve heard this one too many times.  So, just for yuks, I decided to take a look at the distribution of degrees awarded by field of study across the G7 countries, plus (since I’m overdue in throwing some love in the direction of the blog’s antipodean readership) New Zealand and Australia.  The data is from the OECD, and is valid for 2012 for all countries except France, where the data is from 2009, and Australia where it is from 2011.

I started with the percentage of degrees that came from the Arts and Humanities.  The result was… surprising.

Figure 1: Percentage of All Degrees Awarded From Humanities Fields

1

 

 

 

 

 

 

 

 

 

 

 

 

Germany leads the pack with just under 21% of all degrees being awarded in humanities, and Canada and Australia bring up the rear with 11.6% and 11.1%, respectively.  So much for the narrative about Canada producing too many philosopher baristas.

But as we all know, humanities are only half the story – there’s also the question of applied humanities, or “Social Sciences” as they are more often known.  The Social Science category includes business and law.  It turns out that if you add the two together, the countries cluster in a relatively narrow band between 47 and 56 percent of all degrees granted.  No matter where you go in the world, what we call “Arts” is basically half the university.  We should also note that Canada’s combined total is essentially identical to those of the great STEM powerhouses of Japan and Germany.

Figure 2: Percentage of All Degrees Awarded From Humanities and Social Science Fields

2

 

 

 

 

 

 

 

 

 

 

 

 

Let’s now look directly at the STEM fields.  Figure 3 shows the percentage of degrees awarded in Science and Engineering across our nine countries of interest.  Here, Germany is in a more familiar place, at the top of the table.  But some of the other places are surprising if you equate STEM graduates with economic prosperity.  France, in second, is usually not thought of as an innovation hub, and Japan’s third place (first, if you only look at engineering) hasn’t prevented it from having a two-decade-long economic slump.  On the other hand, the US, which generally is reckoned to be an innovation centre, has the lowest percentage of graduates coming from STEM fields.  Canada is just below the median.

Figure 3: Percentage of Degrees Awarded from Science and Engineering Fields

3

 

 

 

 

 

 

 

 

 

 

 

 

Last, Figure 4 looks at the final group of degrees: namely, those in health and education – fields that, in developed countries, are effectively directed to people who will pursue careers in the public services.  And here we see some really substantial differences between countries.  In New Zealand, over one-third of degrees are in one of these two fields.  But in Germany, Japan, and France – the three STEM “powerhouses” from Figure 3 – very few degrees are awarded in these fields.  This raises a question: are those countries really “good” at STEM, or do they just have underdeveloped education/heath sectors?

Figure 4: Percentage of Degrees Awarded in Health and Education Fields

4

 

 

 

 

 

 

 

 

 

 

 

 

So, to go back to our initial story: it’s true that Japan and Germany are heavier on STEM subjects than Canada.  But, first, STEM-centricness isn’t obviously related to economic growth or innovation. And second, STEM-centricness in Germany and Japan doesn’t come at the expense of Arts subjects, it comes a the expense of health and education fields.

June 09

STEM and STEAM: The “Two Cultures” and Academic Incentives

About a month ago, I wrote about whether institutions would adjust their program mix if it would help improve economic growth.  Nearly everyone that wrote me implicitly assumed that the “right” mix for economic growth implied a switch to a more STEM-heavy system, before going on to say something like “but what about the humanities?”  I found this kind of amusing, because I actually don’t automatically assume that STEM (Science, Technology, Engineering, and Mathematics) degrees are where it’s at in terms of growth, and there are a couple of quite high-powered papers out that support this view.

The first, Revisiting the STEM Workforcecomes from the National Science Board in the US.  This publication makes a couple of sensible points, the most important being that STEM skills and STEM degrees are not the same thing.   Lots of STEM graduates end up in non-STEM employment; conversely, many STEM-field jobs are held by people who are not themselves STEM graduates (Steve Jobs, famously, went to Reed College and was self-taught as far as computers went).  Basically, the link between higher education credentials and labour market skills is nowhere near as tight as people tend to assume.

The second new STEM report, from the Canadian Council of Academies, makes an even more important point: namely, that STEM skills are a necessary condition for innovation, but not a sufficient one.  The panel that wrote the report (led by former Bank of Canada Governor David Dodge) did not go quite as far as Don Tapscott did in his plea to replace a focus on STEM degrees with a focus on STEAM degrees (i.e. STEM + Arts).  They did, however, point to a number of other types of skills, such as communication, team work, leadership, creativity, and adaptability, which they felt were at least as important as narrow STEM skills.  The panel also made the point that the best way to meet future human resource challenges is to focus more broadly on skill acquisition from pre-primary to higher education, across a range of subjects – because, frankly, you never know what kind of labour market you’re going to need.

Both reports say we need to get over our obsession with STEM, a conclusion that typically brings cheers from the humanities’ defenders.  But be careful here: even if you buy the “more STEAM” conclusion, it says nothing about the number of Arts degrees that should be produced.  Companies are not dying to hire more Arts grads so they can add that little something of creativity and communication to existing teams of STEM workers.  What they are looking for are individuals who can integrate all of those skills.  It’s a call for more crossover degrees involving both Arts and STEM.  It’s a call to get beyond C.P. Snow’s Two Cultures.

The real problem is that universities genuinely do not know how to deliver programs like this.  Fundamentally, they are designed to focus on degrees rather than skills. Sure, programs can cross departmental lines; however, programs that cross faculty lines are the red-headed step-children of higher education.  As a result, “real” programs – read: prestigious programs – more or less follow disciplinary lines.  Within universities, faculties count success by how many students are “theirs”, but cross-faculty programs exist in a kind of no-man’s-land: they simultaneously belong to everyone and no one.  With no incentives, there’s simply no pressure from below – that is, from faculty – to embark on the arduous journey of creating a curriculum, and working it through the academic approval process.  In other words, STEAM only works for Arts at a resource level (and hence a political level) if it means more Arts degrees; if not, then forget it.

It would all be so much easier if institutions were built around what we wanted students to learn; instead, they are organized by academic disciplines that are necessary guardians of research quality, but in many respects actively hinder the development of balanced graduates who can succeed in work and society.  Finding ways to mitigate this problem is one of the most important questions facing higher education, but we can’t seem to talk about it openly.  That’s a problem that needs solving.

June 05

Articles of Faith

Further to Tuesday’s blog about STEM panics, I note a new report out from Canada 2020, a young-ish organization with pretensions to be the Liberals’ pet think tank called Skills and Higher Education in Canada: Towards Excellence and Equity.  Authored by the Conference Board’s Daniel Munro, it covers most of the ground you’d expect in a “touch-all-the-bases” report.  And while the section on equity is pretty good, when it comes to “excellence” this paper – like many before it – draws some conclusions based more on faith than facts.

Take for example, this passage:

Differences in average literacy skills explain 55 per cent of the variation in economic growth among OECD countries since 1960. With very high skills and higher education attainment rates, it is not surprising to find Canada among the most developed and prosperous countries in the world. But with fewer advanced degree-holders (e.g., Masters and PhDs), and weak performance on workplace education and training, it is also not surprising to find that Canada has been lagging key international peers in innovation and productivity growth for many years.

The first sentence is empirically correct, but things head south rapidly from there.  The average literacy rates do not necessarily imply, as the second sentence suggests, that higher education attainment rates are a cause of prosperity; Germany and Switzerland do OK with low rates, and Korea’s massive higher education expansion was a consequence rather than a cause of economic growth.  The final sentence goes even further, implying specifically that the percentage of the population with advanced degrees is a determinant of productivity growth.  This is flat-out untrue, as the figure below shows.

Figure 1: Productivity vs. PhDs per 100K of population, select OECD countries

image003

 

 

 

 

 

 

 

 

 

 

 

 

Countries in this graph: US, UK, NL, NO, BE, CH, D, SE, FI, O, DK, UK, US, IE, FR, CA, JP

The pattern is one you see in a lot of reports: find a stat linking growth to one particular educational attainment metric, then infer from this that any increase on any educational metric must produce growth.  It sounds convincing, but it usually isn’t true.

It’s the same with STEM.  Munro tells us Canada has a higher share of STEM of university graduates than the OECD average (true – and something we rarely hear), but also intones gravely that Canada lags “key international competitors” like Finland and Germany – which is simply nonsensical.  Our competitive economic position is in absolutely no way affected by the proportion of STEM grads in Finland (it’s Finland, for God’s sake.  Who cares?); as for Germany, since they have a substantially lower overall university attainment rate than Canada, so our number of STEM grads per capita is still higher than theirs (which is surely a more plausible metric as far the economy is concerned.

I don’t want to come across here as picking on Munro, because he’s hardly the only person who makes these kinds of arguments; such dubious assumptions underpin a lot of Canadian reports on education.  We attempt – for the most part admirably – to benchmark our performance internationally, but then use the results to gee up politicians for action by drawing largely unwarranted conclusions about threats to our competitive position if we aren’t in the top few spots of any given metric.   I don’t doubt these tactics are well-meant (if occasionally a bit cynical), but that doesn’t make them accurate.

The fact is, there are very few proven correlations between attainment metrics in education and economic performance, and even fewer where the arrow of causality runs from education to growth (rather than vice-versa).  If we have productivity problems, are they really related to STEM?  If they are related to STEM, which matters more – increasing STEM PhDs, or improving STEM comprehension among secondary school students?

We have literally no idea.  We have faith that more is better, but little evidence.  And we should be able to do better than that.

June 03

STEM, Shortages, and the Truth About Doctoral Education

Harvard’s Michael S. Teitelbaum came out with an interesting new book last month called, Falling Behind? Boom, Bust and the Global Race for Scientific Talent.  Though it’s a very US- focused book, it’s worth a read as a corrective to the occasional hysterics that people have in Canada about our alleged STEM crisis.

The book starts with a wonderful chapter called “No Shortage of Shortages”, which suggests that the current STEM-shortage panic is the sixth in the US since Sputnik.  He also eviscerates the various employer- and research university-led reports that precipitated the most recent crisis talk (Innovate America, Tapping America’s Potential, and Rising Above the Gathering Storm), and shows that the evidence backing up these claims for crisis  simply don’t hold up.  What does hold up are the structural incentives that exist for various groups to claim there is a crisis when there is none: universities get more money, professors get more grad students, and employers get more PhDs, or more H1-B visas to enable the hiring of foreigners.

An interesting question Teitelbaum raises is whether it might be possible to create a board or agency with the responsibility of declaring when certain occupations are indeed in shortage.  He correctly lists a whole bunch of structural reasons why it might be difficult to find a respected neutral body that interest groups wouldn’t immediately try to undermine, but he does raise the interesting example of the UK’s Migration Advisory Committee, which has the responsibility of advising government on when shortages in specific skilled professions has become sufficiently acute to merit changes in immigration law.  Certainly something to think about with respect to our own Temporary Foreign Workers’ Program.

But to my mind the most important chapter – one everyone in higher education should read – is the chapter on the U.S. Academic Production Process.  He makes the point that the production of doctoral students is a function of research grant availability, not of demand for services of doctorally-educated graduates (and certainly not of the needs of academic institutions for new faculty).  Universities want doctoral students (and increasingly, postdocs) because over time, they have become the go-to form of scholarly labour that university research labs require in order to work.  If they have more money – say, if the US government increases the NIH budget by 100% over five years – there will be a huge explosion in the demand for doctoral students, which is entirely unconnected to the labour market demand for doctoral graduates.

This is a simple and unarguable point, but it is rarely stated quite so bluntly.  Eventually, domestic students figure this out, and fewer go into doctoral studies.  But that doesn’t decrease the demand for this kind of labour – so institutions start reaching out more and more for foreign students, particularly from Asia.  For these students, grad student conditions (and those that come afterwards, even in a depressed labour market) still look pretty good compared to what they can get back home.  To his credit, Teitelbaum doesn’t pretend there are any easy answers to this one and, in the end, simply falls back on the idea of requiring institutions to do a better job informing prospective graduate students about the realities of the academic job market – in terms very similar to the ones I proposed back here.

Anyways – pick up Teitelbaum if you get a chance.  It’s a rewarding read.

November 09

Is Higher Education Oversold?

Alex Tabarok at Marginal Revolution recently asked an interesting question that has spread quickly across the blogosphere – is college oversold? I think this question is going to get asked a lot more as the economic slowdown wears on, so it’s worth examining.

Basically, Tabarok notes that U.S. enrolment in STEM (science, technology, engineering and mathematics) subjects has been stagnant over the last couple of decades, whereas enrolment in “softer” subjects with allegedly (no data is provided) lower rates of return, such as psychology, visual arts and journalism is way, way up. On this basis, he suggests that “college has been oversold.”

This is an interesting way of phrasing the problem to say the least. Who is doing the alleged overselling, exactly? And what motives might they have for doing so?

Let me suggest some alternate theories that might explain this phenomenon:

1) Perhaps it’s a symptom of colleges being underfunded. Government dollars have been tight even while demand is increasing. Perhaps American universities – like universities almost everywhere in the entire world – have reacted to this problem by bulking up on social science programs that are cheap to deliver while keeping a lid on more expensive science and engineering programs.

2) Perhaps it’s just universities reacting to demand. When we curse crappy reality TV for things like Jersey Shore, we don’t just blame the networks for airing it; deep down that what we’re really cursing is the taste of the viewing public. Same thing here: maybe the consumers of education, not the producers, are to blame.

3) Perhaps it’s students looking at ROI in terms other than dollars. Prestige, for instance. Decades of over-production of lawyers haven’t dimmed the allure of law degrees in Latin America, because of the prestige factor; maybe the same thing’s going on with journalism in the U.S. Or “fit”: students don’t feel connected to science and engineering when they apply to university so they discount the potential monetary gains by thinking about how much, deep down, they hate lab work and how much they’d give up to avoid it.

4) Finally, maybe students are just acting like rational consumers. Returns to engineering – especially computer science – have been highly volatile in the last two decades. Plus, as we’re repeatedly told, Indian programmers can kick Americans’ butts at a tenth the price. Does that sound like an industry to which you’d want to commit your future?

I’m not saying any of these are necessarily full explanations for the problem of overproduction of graduates in fields with low ROI. I’m just saying they are valid – but less emotive – hypotheses to rival the “we’ve been sold a bill of goods” line of argument. They deserve equal billing.

August 31

Why is there an “S” in STEM?

Governments love to talk about STEM (science, technology, engineering and mathematics) programs. They were given prominent space in the last Canadian federal budget, and the acronym permeates U.S. educational policy discourse. It’s conventional wisdom that increasing the number of STEM graduates is essential to economic growth. You might think that the chief purpose of the modern post-secondary institution is to churn out graduates in STEM fields – and that as a corollary, arts students are some sort of vestigial leftover from a bygone era, kept around only to avoid the pain of their excision.

The full-court press to jack up STEM graduate production rates overlooks one important detail – the STEM fields are hardly a monolith, and there are some very important differences among them. Indeed, sometimes it’s unclear why these fields are grouped together at all. The issue, in large part, lies with the “S” – an undergraduate science degree is much less likely to get you a job.

Take a look at labour force status of the class of 2005 two years after graduation, courtesy of Statistics Canada’s 2007 National Graduates Survey. For comparison, we’ve left in data for the humanities – a field that is seldom lauded as the ticket to immediate success in the job market.

It becomes quickly apparent that one of the STEM fields is not like the others. Graduates in the physical and life sciences have extremely low employment. Barely half of them have a full-time job, only two-thirds are employed at all, and almost a quarter are not in the labour force – two years after graduating. Moreover, they have the highest rate of unemployment (11%). Students in engineering or math and computer science, by contrast, have full-time employment rates of around 80% and employment rates around 85%, with unemployment under 8%. Based on short-term employment outcomes, the sciences have little in common with the other three. It makes you wonder: if “TEM” sounded half as good as “STEM,” would we be so quick to lump in the sciences with the rest?

Of course, the sciences still offer great value to their students and society – even if that value doesn’t pay off as employment in the short term. And should science’s showing on these graphs make it feel lonely, there’s another field that might be its friend. As the data shows, a science student’s employment prospects are rather similar to those of a humanities graduate. And that’s something we shouldn’t hide behind an acronym.