By Azeem Ibrahim
The recent news that education budget cuts in the UK will be the deepest since the 1950s raises alarms at many levels. A 14% cut in spending on public education is closer to 20% in real terms and will have a devastating effect on the long term prospects of young people's exam results and earnings potential. Researchers at the Institute for Fiscal Studies have calculated that this projected fall in funding is the largest drop in over 70 years and marks the end of a commitment to enlightened education spending under previous governments.
While the economies of Europe and the US are still stagnating with slow growth and an even slower recovery from the 2008 global economic crisis, there seems to be a growing chorus of economists calling for austerity budgets and cuts in public spending.
Yes, the UK debt needs to be cut, and yes, deficit reduction is an important goal but why should it have become the dominant international issue when significant evidence indicates that austerity measures without a comprehensive growth plan will only increase unemployment and further depress the economic recovery?
Any debate over measures to improve the economy should begin with the question – how many jobs will it create and how will it help the country? The notion of "expansionary austerity" has been thoroughly debunked by the Economist and the IMF, yet governments continue to promote it. Instead of cutting social programs, governments should be investing in job-producing programs; education is surely the most important investment into future jobs that a country can make.
The education budget should be inviolate instead of consistently on the chopping block. An education budget is a jobs budget and it is fiscally irresponsible to slash spending on education, thinking it will help to boost a sluggish economy.
The erosion in quality of a nation's public education does not make sense in an economy which increasingly is a global knowledge economy. How will students starting school now be able to compete with their international peers? Investments in education are known to yield high returns through increased economic output, which is why China and India have both dramatically increased their education funding. What would be the point of a balanced budget in 20 years time, if Britain has been overtaken by a better educated Asian workforce, better prepared for the global economy of the 21st century?
We need to build a knowledge economy, as the fastest growing industries, such as information, professional and business services and health care all need at least some higher education.
The new approach to commercialising research in British universities, to utilise private funding rather than taxpayer contributions, is another dubious argument in cost effective strategies. Where university vice chancellors are being transformed into chief executives, the quality of pure research would seem to be subverted by the new "managerialism". Short-term gains may have long-term disadvantages, just as temporary savings will harm education in the long term, especially in the field of technology.
Investment in technology in schools and universities must keep pace with the rapid changes and innovations in the industry, so that students entering the workforce will not be at a disadvantage compared with their international peers. Already the brain drain is operating in unforeseen ways, as knowledge work can be done anywhere in the world and white collar globalisation is on the increase.
Britain is trying to attract educated immigrants to meet the national demand for higher skill levels and is seeing its own educated workers wanting to leave for more advanced centres of research and development. Many students view an investment in an international education as a ticket to migration and more than 50% of international students from Asia eventually secure permanent residence in a developed country. This could change however, as technology companies are increasingly setting up foreign operations to absorb these new graduates.
India already has 520,000 IT engineers, and China graduates twice as many mechanical engineers each year than the US. Where once the concern was that manufacturing jobs were disappearing overseas, now the globally integrated knowledge economy is moving also to developing nations. Corporations are outsourcing IT service and engineering work, financial and customer care at a rate that is only going to accelerate. The theory is that western countries have the education and the research and development funding to continually innovate, with talented people adapting as they always have. But this will only work is there is a corresponding commitment to investment in education at all levels.
The UK, like other western countries, will have to compete with the explosion of college graduates in low-wage countries and some experts say that the big job migration has only just begun. Right now, developing countries are the winners as they can offer investor friendly policies and ample cheap college graduates.
The UK government's refusal to see that investment in education is necessary will have serious consequences. Exactly what those will be, we will soon find out.
Dr Azeem Ibrahim is a Fellow and Member of the Board of Directors at the Institute of Social Policy and Understanding and a former Research Scholar at the Kennedy School of Government at Harvard and World Fellow at Yale.
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