Enrolment share in deregulated higher ed markets

Andrew Norton2 Comments

With the supply of Commonwealth-supported places to be largely deregulated from next year for public universities, there is considerable anxiety at some institutions about how this will turn out. My theory is that a market without price signals will be bad for lower-prestige universities. But what about markets with price signals? The 2010 enrolment data can give us some guidance.

For domestic fee-paying students (mostly postgraduate coursework students), three university types have greater market share than they do for CSPs: the Group of Eight, the Australian Technology Network Universities, and the New Generation Regional Universities (groupings defined below, taken from the categorisations in this paper). Charles Sturt is very strong in postgraduates, helping to explain the strong showing of that group.

For international students, the Group of Eight and the ATN again have market share exceeding their CSP market share, with the New Generation Regionals having about the same share of internationals as CSPs. This is largely due to the entrepreneurial activities of Central Queensland University and the University of Ballarat, which are both highly competitive on price and recognising that students will not come to them, go to the students.

Clearly the Group of Eight and the ATN start in strong positions. But only two universities have less than 10% of their students from overseas, and there is lots of variation within broad university types. Mission and management can make a big difference.
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The university gender gap

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My semi-regular piece in the higher education section of The Age was this week on the gender gap at universities, with women making up 58% of domestic enrolments. The figure below shows the post-WW2 trend. Since 1957 there has been only one year in which women did not gain enrolment share, and that was last year – men picked up 0.08 percentage points of total enrolments.

My initial intuition was that this imbalance was a serious problem, but in the end I was a bit equivocal. Higher education’s loss has been vocational education’s gain, and though fewer people with voc ed than higher ed get very high salaries, upper-level vocational qualifications are as good as insurance against unemployment as a degree.

Due to the relative reluctance of female graduates to work full-time, the uni gender balance clearly has major implications for workforce supply. But apart from the health professions the policy of flooding the labour market with graduates has meant that shortages are occasional and cyclical rather than chronic.

Long ago I suggested that the imbalance was contributing to a shortage of suitable male partners for university-educated women. It’s certainly impossible for every female graduate to find a husband who is also a graduate, though at the time of the 2006 census female graduates were only slightly less likely than male graduates to be partnered.

For male uni students and graduates the imbalance is probably a plus, due to less competition in labour and marital markets.

For the guys doing well enough at school to at least get a certificate III or IV the overall situation is not a disaster. It’s the men with no or lower-level qualifications who are in trouble.

Are high student:staff ratios bad for retention?

Andrew Norton2 Comments

According to the Universities Australia productivity paper, high student:staff ratios have a negative effect on retention. The citation for this claim is to a 2001 American academic journal article. But what does the local evidence suggest?

The figure below shows the student:staff ratios reported by Universities Australia and the attrition data reported by DEEWR for domestic commencing students (so retention is 100% minus the attrition rate).

Now there are problems with both sets of numbers. Actual teaching capacity is understated and actual attrition is overstated because of problems with the way the data is collected. But I don’t think those problems can explain away the trend evident in the figure. If the UA hypothesis was correct for Australia, student:staff ratios and attrition should be positively correlated: if SSRs go up, so should attrition. Instead, they are negatively correlated: as SSRs have gone up, attrition has gone down.Read More »

Teaching funding and teaching costs

Andrew Norton4 Comments

A new Universities Australia lobbying document released today (The Australian‘s report is here) contains some not previously publicly released information on university costs, based on information from six universities. The data is presented in a slightly confusing way, as UA have made the assumption that 25% of Commonwealth subsidies paid on a per student basis is for research, creating separate funding ‘gaps’ for teaching and research.

However, what it shows (if you get your calculator out) is that teaching-driven Commonwealth funding of $16,068 per average EFTSL and teaching-driven expenses of $16,151 per average EFTSL are pretty much in alignment. This helps explain why so many universities are significantly ‘over-enrolled’ – once the demand-driven funding system is fully operational they expect to at least break-even by avoiding research costs.

The funding ‘gap’ varies significantly between fields of study:

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Will third party campaign finance law increase or decrease political participation?

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Today The Conversation website published an article by me criticising regulation of third parties, and another by Marian Sawer partly critiquing my article.

My article was mainly about what I regard as the systemic effects of third party regulation, which is how restricting third parties affects the overall balance of political influence. This is principally about the big third parties, the organisations capable of reaching and potentially influencing a mass audience. These include unions, business, environmental groups, and GetUp!. At the systemic level, the most important aspects of third party regulation are the caps on expenditure, and to a lesser extent the caps on donations.

Sawer’s article is mainly about what I call the participation effects of third party regulation, the opportunities that individuals and small groups have to get involved in politics. Unless many of these third parties spontaneously pursue the same causes, I don’t think they are likely to have much effect on political outcomes. But in a liberal democracy, people being able to have their say is important in itself.

According to Sawer, third party regulation could be positive for participation. The argument here seems to be that there is limited space for political communication, and to the extent to which attention is grabbed by a few big players this denies smaller groups their opportunity to be heard. Read More »

Does higher education reduce crime?

Andrew Norton5 Comments

One argument made for higher education – at least when arguing for more funding – is that it helps reduce crime. A visiting OECD official recently made the reduced crime claim for higher education, citing Walter McMahon.

Graduates are likely to have quite low conviction rates – I have not been able to find precise statistics, but in 2009 only 14% of 25-34 year old prisoners had completed year 12, compared to 63% of the general population in 2006.

But it seems more plausible to me that graduates are people who were always at relatively low risk of offending, regardless of whether or not they pursued higher education. This low risk would be a function of better socialisation, and the ability to earn a reasonable income without breaking the law. Education is likely to have whatever preventive effects it is going to have well before higher education.

The broad historical trends would also seem to count against any straightforward link between higher education and crime. Australia’s crime statistics don’t lend themselves to easy long-term time series, but crime and education both escalated significantly from the 1970s. The figure below shows crime and higher education attainment increasing from the mid-1990s to around the turn of the century, before crime started trending down again (as also occurred in other countries).


Sources: Education and Work, Australian Institute of Criminology

My theory would be that a third factor at least partly explains both trends, though I think crime is a more multi-factor phenomenon than higher education. The collapsing labour market opportunities for men with little education over the last 30-40 years made both crime and higher education more profitable relative to the alternative of welfare/insecure jobs. So crime and higher education both increased.

But there is no direct relationship between crime and higher education, and increasing the latter will not decrease the former.

Which slopes are slippery?

Andrew Norton12 Comments

Near the end of his anti-gay marriage article in today’s Age, Ted Lapkin does get to some substantive reasons why he thinks gay marriage is a bad idea. But much of the article is devoted to the slippery slope argument that once we have gay marriage we will slide into things we really don’t like, such as legal recognition of polygamy and decriminalising incest.

I don’t disagree with Lapkin that issues can develop their own logics, and that one change can make another change more likely. I think we are now nearing the base of a moderately slippery slope on gay issues. Once the state gave up on the idea of actively persecuting gay people for acting on their sexual desires, it became harder and harder to defend all the other ways in which the law disadvantaged them.

Lapkin himself says that everyone, gay or straight, is entitled to identical protections from the law – something that few conservative defenders of the family would have said until quite recently. Once you are sliding on the slippery slope, it can be hard to stop. The last conservative stand on gay issues at the Marriage Act is no more likely to succeed in the end than any of the other battles along the way.

The question then is not whether slippery slopes exist, but whether you can slide from one slope to another in any kind of deterministic fashion (“The floodgates will inevitably open to a further slide down the slippery slope of social disintegration”.) Read More »

The workforce supply of female graduates

Andrew Norton8 Comments

I’m writing a piece for The Age on the feminisation of Australia’s universities. In 2009, 59% of domestic commencing students were women. Overall the proportion of students who are female is a little lower, as there are strong male biases in education in some source countries for overseas students.

The gender shift in enrolments has big implications for the future labour supply of graduates. Though the 2006 census is getting a bit out of date, the figure below is striking. After their 20s, only a minority of female graduates work full-time except for age 50-54, when 51% are full-time workers. Obviously parenting responsibilities are a major factor in this, but even childless women are much less willing to work full-time than men.

I thought these numbers might offer some insight into the finances of the HELP loan scheme, but the ATO tax statistics don’t support this hypothesis.

Women owe 56.6% ofthe outstanding HELP debt, much what we would expect given their share of the student population. The average female balance of $12,361 in 2008-09 is lower than the average male balance of $13,914. I can think of a couple of possible reasons: the strong female majorities in cheap (to the student) courses such as education, nursing and arts; and a larger number of female than male graduates who have old unpaid debts, but at lower totals due to cheap HECS rates in the past.

If the gender age-work patterns persist, it does however raise questions about what happens if student contributions increase. Historically, the average repayment time for HECS/HELP debts is about 8 years. So on lower student contribution amounts, women who graduate in their early 20s could clear all or much of their debt by the time they leave full-time work to raise kids. But if initial debts are larger, that may not be the case.