Universities, researchers and the recession

12 July 2009

By Tristram Hooley

Dr Tristram Hooley trawls the web to find out how the recession is impacting on universities

I’m not an economist, but I know what I don’t like. What I don’t like is being bamboozled and terrified about the recession by twenty-four hour news channels and newspapers. See The Guardian's Media Talk podcast on reporting the recession.  I'd like to be able to get away from a general sense of dread about recession and move towards a better understanding of how it is going to impact on me and the things that I care about. This is difficult as most of the news reports on the recession that I've seen have either been pretty general e.g. 'Economy tanks - shocker!' or focused on industries that have been hit in pretty straightforward and obvious ways 'Orders for widgets drop to fifty year low - widget manufacturers lay off staff.'  Coverage of the recession is frequently bizarre, focusing on subjects as diverse as cosmetics,  baby booms, and suicide and murder.

For those of us who work in and around higher education it is difficult to work out exactly what effect the recession is going to have on us. So I thought that I'd pull together some coverage from a variety of news sources and try and work out what it was telling me. As I said at the beginning, I'm not an economist, so this is just the best guess that I can give you. I'm hoping that it will spark off hundreds of more informed replies telling me where I've got it wrong.

The Times Higher provided a less than upbeat summary of the situation on the 9th July with a headline that screamed Restructure or die, funding chief tells cash-hit universities. This article reports on a recent speach by Steve Eagen (deputy chief executive of HEFCE) who stated that VCs are expecting 5-10% cut in their funding and argued that universities were going to have to "cope with less public money", focus on their core areas and face up to the possibility that some universities might close. Scary stuff, but is there any evidence to back it up?

At the end of June a conference took place in Copenhagen Business School entitled 'Higher education at a time of crisis'. The PowerPoints from that conference give a pretty good flavour of how some of the most powerful and informed people in the education world are seeing the recession and its impact on higher education. A particularly interesting presentation came from Dirk Van Damme of the Centre for Education Research and Innovation at the OECD (Organisation for Economic Co-operation and Development) who makes the following points:

• There is a strong chance of cuts in public funding to universities
• Despite the aging population the level of participation in higher education will maintain at the current level or increase as people enter education to remain outside of the labour market.
• Non-governmental income for universities is likely to decrease as tuition fees hit a ceiling and endowments and R&D spending from industry are hit by the recession
• Universities will see increased competition and many will attempt to diversify into new areas. However there is also competing pressure to focus activities around clearer institutional missions (e.g. are you a research or teaching institution)
• Universities will face challenges with relation to their staffing and may look to reduce recruitment, restructure or even make redundancies. Take a look at the THES article on current job threats to see that this is not just idle speculation.

This summary doesn't do the presentation justice so you might want to view Van Damme's presentation for yourself.

Van Damme isn't a lone voice in arguing that higher education is going through some major recession induced change. Educational charity the Sutton Trust has recently published their Young People Omnibus 2009 suggesting that more current 11-16 year olds want to go to university than at any time in the last six years. The message of increased student demand is picked up elsewhere with BBC News noting this report alongside a rise in undergraduate applications and calls from Liberal Democrat MP Phil Willis to lift the cap on student numbers. Recent surveys by milkround.com and the Association of Graduate Recruiters have found that this trend is likely to manifest in postgraduate applications as well. How higher education is going to cope with this increase and whether they will be turning to researchers to help out, remains to be seen. 

Obviously this kind of economic prediction is far from an exact science, but if even some of it is true it is likely to mean an increasingly competive jobs market for researchers in the next few years. Gaining a tenured lectureship looks like it might become more challenging than ever. What is more a Google news search on 'recession r&d' shows that there is also quite a bit of anxiety about how the recession is likely to hit industrial research. However, again this is not a foregone conclusion, with many, including the European Commissioner for Science and Research, Janez Potočnik, arguing that strong R&D spending is a key way to bring an economy out of recession. See University World News. 

So what is a researcher to do? Well the old story about the two men who see a leopard coming to attack them comes to mind here. One man quickly starts putting on his running shoes while the other berrates him saying that he'll never outrun the leopard. "I don't have to outrun the leopard" he replies, "I just have to outrun you."

If the predictions of doom mongers like Dirk Van Damme are right, and the man clearly knows a lot more about the global economy than I do, the next few years are going to be pretty tough. It seems to me that the more you keep your eyes open for opportunities, the more aware you are about the economy and the trends in higher education the better chance you are going to have. You might also have to be willing to be more flexible in your career aspirations and to recognise that the recession might change both the number and nature of opportunities that are available to you. This might feel unsettling at the moment, but in ten years time you might be looking back and thinking, if it wasn't for the recession I never would have ...

It may be a fallacy that the Chinese word for crisis is the same as the word for opportunity (see wikipedia) but your career will continue through the recession and beyond. How you respond to both crisis and opportunity is the one thing that you can definately control.

Anyone think I'm barking up the wrong tree?

By Dr Tristram Hooley, Senior manager: stakeholders and networks, Vitae

Vitae would like to thank the author for contributing this article. Vitae would like to remind readers that the information and opinions expressed in this article are those of the author and do not necessarily reflect the views of Vitae or CRAC: The career development organisation.

This article has been published as part of Vitae's Researcher careers and recession online activity in July 2009.  To view other articles on this theme please visit www.vitae.ac.uk/careersandrecession