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Education for productivity

Stuart Middleton
New Zealand Education Review
Vol. 14 No.29, 31 July 2009, p.16
APN Educational Media (NZ) Ltd.

“Thanks a million!” we say when someone deserves our greatest gratitude. Hundred of thousands watch “Who wants to be a millionaire” and when Lotto gets up into the millions, millions flock to the shop to get their ticket.

“Million” has something of a ring to it. So it is little wonder that the firm belief exists that a successful university college education is worth $1 million over a lifetime to those with such qualifications. You perhaps should smell a rat in all this when the figure is constantly $1 million regardless of whether this is referring to the USA or Australia or even New Zealand.

Debate has burst out in the USA this week as this old hardy annual is challenged.

The belief goes like this. Taking a US high school diploma as the base point, a Bachelors degree is worth $0.9m more over a lifetime, a Masters is worth an additional $1.3m while a Doctorate is way out in front with an extra $2.2m. Of course it matters a little in which discipline the qualification is gained – Engineers earn the most while Education majors earn the least (of the group with degree qualifications).

So decisions about which discipline will affect this ability to earn over a lifetime.

Burleson Consulting claims that “everyone who has been to college knows that if you cannot succeed at pre-med or engineering, students fall back into Business Administration or Nursing. If they fail in Business or nursing they pursue liberal arts or social science (i.e. Psychology, Economics), and if they fail all else, students graduate with degrees in Education and Art History.”

Imagine me at this point, sitting at my desk, assessing whether the nib of my fountain pen will pierce the arteries in my wrist – my degrees are in liberal arts and social sciences and predominantly in Education. How did I miss out on Art History?

The debate that has burst out is to challenge the $1 million benefit – clearly a college or university degree makes a difference but different degrees make different differences! It is being argued that the high cost of gaining a degree now is wiping out the advantage of a higher education qualification. But, it is counter-claimed, that is only when the calculations are undertaken in today’s dollar terms. Over a real life time the dollar changes and the advantage is sustained. Back comes the riposte – getting the highest qualifications sometimes takes three or four further years (and they are at a cost not only in tuition fees etc but also in lost income).

But is this a useful argument to have when increasingly financial barriers perhaps lock out so many before they start? Perhaps, but the real benefits of a tertiary qualification cannot be ignored. All the evidence is that the American dream of a college education was founded on a dream of egalitarianism. OK, it didn’t turn out so well for many.

What is the situation in New Zealand? Education Counts, that wonderful Ministry of Education website that is such a store of information has completed a study of the impact of education on income in New Zealand. Some of the findings are interesting.

Education is certainly reflected in the average median weekly wage. No qualifications and school qualifications sit on and just above $300 per week respectively in 2007 income terms. So there is very little difference. A Bachelors degree will bring home $800 on the weekly wage packet, a long way ahead of no qualification and school qualifications. Already the first key point is clear – in terms of income, a post-secondary qualification is critical.

But here is the surprise. Any tertiary qualification other than a degree, that is a certificate or a diploma or some such, will lift weekly earnings to $600 a week!

This is another powerful argument for getting people through school and into a postsecondary qualification without any obsession on making that qualification a degree. There is clear economic gain to the individual in such a qualification. Economic transformation requires increased productivity and economic transformation for the country starts with the economic transformation of the individual through education. The cost to us all of not accepting the prime need to get young people into tertiary, to get those in our community who are unqualified into tertiary, can only be a symptom of a belief in economic degradation.

Some other findings: returns from higher qualifications are greater for Maori largely due to the higher levels of disadvantage within that group – so Maori students are a sounder investment. Maori women are traditionally remunerated at a lower level when compared with non-Maori but that gap closes with higher qualifications until it disappears completely at the postgraduate level.

This trend, the link between educational qualifications and income, is one which is strengthening – so let’s keep the momentum going. Getting out of the recession better than we went into it in terms of productivity would be to see that we increase the trend towards more highly qualified communities. Of course this assumes that those on higher wages are more productive – oops the hornets are stirring.

But certainly we need at this time to be even more determined than ever to increase pathways into or back into postsecondary education and be rightly tough on spending where this is not a clear outcome. So a blunt policy instrument approach to Adult Community Education funding, or a blanket approach to wiping out the Training Incentive Allowance for Level 4 and up, or taking an uncritical approach to tertiary funding caps might in the long run be simply bad economics.

New Zealand needs to be able to point to its education system as one that produces independent citizens rather than dependent people, productive citizens who contribute rather than those who simply take, people of all ages who add value to this blessed country rather than destroy its peace and contaminate its values.

That postsecondary qualification is the marker of such people.

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A role for education

Stuart Middleton
New Zealand Education Review
Vol. 14 No.10, 20 March 2009, p.16
APN Educational Media (NZ) Ltd.

We have been left in no doubt that as far as economic crises go; this is a big one, overshadowed in terms of scale only by the Great Depression and in terms of government intervention, only by the Second World War.

Inevitably, just like all the men and women on the streets, education will be hit and will have a role to play.

During the Great Depression of the 1930’s education spending was reduced through closing the Auckland and Dunedin teachers colleges. Dental clinics and kindergartens were also closed and the school starting age put up to 6 years old. Teacher numbers were reduced which resulted in larger classes. Public servants took a 10% wage cut.

Expenditure on education fell by about 30% between 1930 and 1934 – so it was pretty savage.

The latest economic crisis is not likely to see such a response from any sort of government in New Zealand these days since it would be counter-productive. But education can be expected to both take a hit of some kind and to be required to play a role.

In the 1930’s the response was to seek to find work of any kind for those out of work. Some had to travel to remote places to undertake useful work such as the Te Anau / Milford Road. Others stayed closer to home to engage in less obviously useful work such as the construction of stone walls such as those around Ellen Melville Park and Newmarket School in Auckland. Those left at home had simply to fill the gaps and get on with it.

Despite the disappearance of training from the 9-day fortnight at this early stage, it is clear that education and training will be the work camps of this crisis. Those who cannot be employed fully and especially those who cannot be employed at all should be given access to free education and training. We know with certainty that on the other side of any downturn is the swing back up. Placing those who take the negative impact of this downturn into a position where they can make the most of the upswing is the only decent thing to do.

But this will require tertiary education providers – Institutes of Technology and Polytechnics, Private Training Providers, Wananga and Universities – to think a little differently about how they work in terms of scheduling courses, how they accommodate more students around the margins at little cost, how they make ends meet without seeking a student contribution from those already struggling.

This is not a time for intra-sector squabbles (names are withheld to protect the guilty) – it is rather a time for unity and co-operation. Nor is this a time for esoteric arguments about the “cap” and other interesting issues of funding from either the government or the providers. It is a time for unity and for spending as much or as little as is required to lift the skills and the spirits of those bearing the impact of the financial pressure.

Schools will similarly feel some pressure. Tony Simpson’s wonderful chronicle of the great depression – The Sugarbag Years – notes various impacts of the times on schools. There was a clear decline in the rolls of private schools which placed pressure presumably on the state system. There were fewer resources but remember that this was a time when the schools relied heavily on teaching and student resources provided centrally. There were the cutbacks and closures mentioned at the start of this piece.

Perhaps the biggest contribution schools can make is to work on the pleasing increase in senior rolls reported this year to ensure high levels of students leaving to continue their education and training.

Schools might also have a capacity to entice back young people who are doing nothing. Boot camps might sound all very well to some people but boot-strap camps sound better! Increasing the use of facilities and offering teaching to groups of these young people out of conventional school hours and terms and in different ways, might have some attraction to the layabouts who think that the world owes them a living but now see that the world doesn’t even feel obligated to give a living to decent good people who are prepared to make an effort.

The first Chairman of the Board of Trustees at the then Nga Tapuwae College in Mangere was Brian Edwards, son of Jim Edwards, the famous workers’ leader through the depression years of the 1930’s. Brian had seen plenty of struggles in his younger days and he knew that education was critical if people were to avoid the worst and most brutal vulnerability brought about by economic deprivation. Skills and the ability not only to be employed but also to be employable were at the heart of his view of the school and all that it did.

He was perplexed by the seeming disengagement that was already then becoming apparent. I recall him saying to a group of young people “You have to work hard now so that you will be OK when things get tough.” He knew that those who filled the ranks of the low-skilled and the unskilled were the ones most at risk. He knew that inevitably tough times were always waiting up ahead.

While that is now a little simplistic, essentially it remains a truth. New Zealand is being presented with an opportunity through this crisis. It can reposition the skill sets of many who are already in the workforce. It can tackle the issues of the leaking educational pipeline. It can lift the levels of literacy skills, of technological skills, or managerial skills.

Perhaps the crisis will also teach us that simple lesson, the only lesson that will address issues of productivity: we will all have to work harder. And if we want to work shorter hours (as do the French) then more of us have to be ready and equipped to work.

If education hasn’t got a role to play in all this then I will eat several hats!

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