Weathering the perfect storm
Tanned, svelte and ready to go (ish), The Green Edge is back. And, like much of this summer, we see that universities are facing inclement weather.
As A-Level and Vocational Technical Qualification results are released, universities across the UK are facing a wave of challenges that threaten their financial stability and academic offerings. And, as we return to The Green Edge from our short Summer sojourn, we’ve been thinking about how these challenges might impact degree programs essential to achieving net zero, sustainability, and the circular economy.
Image: Sumanley xulx
Let’s start with engineering: always one of our top interests. By pretty much everyone’s reckoning, engineers are at the forefront of making net zero a reality. They drive innovations in clean technology, sustainable infrastructure, carbon capture, and emission reduction. Engineering disciplines are vital across various sectors, including renewable energy, civil and environmental infrastructure, materials science, and advanced research. Without a strong focus on the education (particularly STEM), training, and development of engineers, the transition to net zero will falter.
Recent surveys conducted for National Engineering Day by the Royal Academy of Engineering reveal that 64% of the public believes engineering jobs are crucial to addressing society’s biggest challenges. The energy sector alone must fill 400,000 roles by 2050, with 260,000 of those being new positions. Additionally, retrofitting efforts will require 30,000 technicians over the next 5-10 years. This sentiment was echoed by Hilary Leevers, CEO of EngineeringUK, in a recent podcast discussion with The Green Edge. Plus, of course, the demand for engineers extends beyond the emerging green economy, with sectors like chip manufacturing also experiencing talent shortages, as highlighted in a recent McKinsey study.
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But the financial challenges facing universities could have a profound impact on the development of future engineers, along with key professions. A perfect storm of issues – declining international student applications, high loan servicing costs, and budget deficits – is forcing universities to make tough decisions. We are seeing redundancies, course cuts, and larger class sizes across the sector. Deferred investments in infrastructure and reduced student support services are also becoming more common. While applications from UK students, still largely made up of 18-year-olds, remain stable, there is a significant decline in mature and international student numbers. This drop is exacerbated by a return to pre-COVID grading standards, which may reduce the number of top grades awarded.
A troubling picture emerges when examining the universities currently undergoing restructuring. A total of 69 of the UK’s 140 or so universities1 have declared redundancies. Engineering and technology departments at institutions like Aston University, Plymouth, and Sheffield are particularly affected2. Additionally, facilities are being mothballed at universities such as Oxford Brookes. The redundancy programs may further reduce the capacity of engineering and technology departments, threatening the pipeline of skilled graduates needed to meet the UK's sustainability goals.
We also know that around 40% of universities are currently declaring a deficit, and this is likely to rise. All in all, the immediate future seems bleak and could directly impact the desire for wider economic growth and social mobility through education.
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Philip Augar, who chaired the 2019 Independent Panel Report on post-18 education funding, recently discussed potential solutions to the funding crisis facing universities. He suggests three main options: raising tuition fees, increasing the strategic grant (his preference), and encouraging greater contributions from employers. Augar emphasised that while cost-cutting is necessary, it does not have to result in a decline in course quality if managed effectively.
The Augar Review also offers several recommendations, including reducing tuition fees to alleviate student debt, increasing funding for high-cost programs like medicine and STEM, rebalancing funding between higher education (HE) and further education (FE), and reintroducing of maintenance grants for disadvantaged students. These recommendations are based on successful international models, such as those in Australia and Canada, which could provide valuable lessons for the UK.
Recent reports from the Higher Education Policy Institute (HEPI) outline four potential scenarios for the future of UK universities: [1] continuation of the current approach, [2] realisation of the 2010 vision, [3] development of a place-based tertiary system, and [4] a differentiated system. We could envisage scenarios three and four happening, even without direct government intervention. And we further note that Sir David Behan said on Radio 4 Today recently that the march of Digital and AI, together with increasing demand for short courses, lifelong learning, experiential leaning, earn-and-learn apprenticeships, and the growth of commuter students, are all playing a big part in how universities will develop over the next few years.
So what do we think? Well, in our view the most likely solutions will come from a larger central funding settlement for universities in England. But this will have to be balanced with universities trimming their costs and offers accordingly. We see the potential shake-up in the post-18 HE market as part of wider post-18 reshaping to boost the role of apprenticeships. If this is the case, then a significant investment in FE is required. This might call for combining FE and HE funding streams, and for decisions to be taken around more balanced post-18 funding. Let’s see. Actions taken on FE and HE are critical for the future development of the UK’s economy and society, and for its ambitions of sustainable growth.
The challenges facing UK universities are significant and multifaceted. The sector must navigate a delicate balance between cost-cutting and maintaining the quality of education, particularly in critical areas like engineering. As we move forward, the actions taken by policymakers, universities, and employers will play a crucial role in shaping the future of higher education and its ability to contribute to a sustainable, green economy.
HESA tells us there are something like 240,000 academic staff across the UK’s universities
A slight wrinkle here is the teacher and lecturer talent pool where engineering and technology is the most dependent on non-UK staff (48% are non-UK of which 30% is non-EU, and 18% is other EU).