Keith Windschuttle

In last month’s budget, the Gillard government announced a $5.4 billion cut to defence spending between 2011 and 2015. At the same time, it committed an additional $5.2 billion over five years to spending on universities. In this edition, Peter Ryan and Harry Gelber examine the consequences of the government’s abdication of duty to our national security. Unfortunately, it is not hard to demonstrate that the corresponding increase in university funding is just as irresponsible.

The additional $5.2 billion for universities is on top of the normal sum of around $5 billion the Commonwealth has recently been providing each year. The extra funds are to pay for the introduction of the system of uncapped places, in which each university rather than the government decides its student intake. Since the policy was announced in 2009, it has already swollen the population of university students by 20 per cent. In 2012, the total number of Australian university undergraduate places has, for the first time, exceeded 500,000.

This is one of the most radical pieces of social engineering ever attempted in this country. The Gillard government has a specific target: to increase the proportion of twenty-five-to-thirty-four-year-olds in the population who hold a bachelor’s degree to 40 per cent by 2025. To reach it, they want to enrol large numbers of young people from disadvantaged backgrounds. “The Labor government set the ambitious target,” Tertiary Education Minister Chris Evans says, “to ensure that 20 per cent of people enrolling in an undergraduate course are from low socio-economic backgrounds by 2020.”

The program is aimed not only at social change but also institutional transformation. Evans and Gillard want to inject egalitarianism into what they call the old elitist universities. They say “it is unfair to lock people out of university” and they will open them up so that “a university education is accessible for all … not just the privileged”.

Their rationale is that the future Australian economy will be dependent on a high proportion of graduates. Evans argues that the current level of 29 per cent of twenty-five-to-thirty-four-year-olds with degrees is too low for the high-skilled economy of the future, where industry-linked research will drive innovation and boost productivity, and where scientific research will produce practical applications. Hence the need for a dramatic change now. “An elitist model of university education,” says Evans, “will consign Australia to second rate economic growth.”

The government’s egalitarian ambitions have already borne fruit. In an analysis of the 2011 applications data, Andrew Norton has shown the strongest growth in university acceptances was among those students who scored between 50 and 70 in their final Year 12 results. The proportion of this cohort gaining entry was up from 14.4 per cent in 2004 to 23.6 per cent in 2011. There was a time, before the expansion of the system in 1989, when scores this low would not get an applicant into any Australian university.

The result today, however, is that universities that target this low-scoring cohort have radically increased their intakes. The most dramatic outcome is that the University of Western Sydney (founded 1989) has this year leaped over the University of Sydney and the University of New South Wales to become the biggest in the state, with 26,419 Commonwealth-supported student places. In fact, UWS now has the second-largest number of students in Australia, just behind Monash University’s 27,586. For academic administrators with grandiose ambitions, tapping into this new pool of applicants is obviously the way to go.

However, this apparently promising scenario also has its downside. The reliability of the predictions about the needs of the Australian economy for future graduates is highly questionable. Chris Evans relied on several reports, in particular the government body Skills Australia, which mostly took their cue from the Bradley Review of Australian Higher Education in 2008. In her report, the principal benchmark used by Professor Bradley was not the predicted skilled labour needs of the Australian economy but our ranking in the list of higher education providers among OECD countries. She urged government to spend more to catch up with the OECD leaders, which included Sweden with 50 per cent of those under twenty-five undertaking degrees, Finland 40 per cent, UK 43 per cent and Ireland 55 per cent. These figures, however, were all published before the GFC of 2008, which subsequently showed little mercy to several OECD economies, especially Ireland, whose high proportion of graduates provided no protection against economic collapse.

In Australia, the employment outcomes of university graduates since 2008 do not augur well for the future. The annual surveys by Graduate Careers Australia show that across a range of fields new graduates have endured high rates of unemployment and even higher rates of failing to find jobs in the areas for which they trained.

The Graduate Careers survey in mid-2008 (made before the GFC crash) showed 14.8 per cent of bachelor degree graduates from the previous year were still seeking full-time employment and either had no job or only part-time or casual employment. Since the GFC, the surveys have found this rate as follows: 2009 20.8 per cent; 2010 23.8 per cent; 2011 23.4 per cent.

What is worse, this is not a short-term phenomenon. A longitudinal study of the graduating class of 2007 found the problem persisted over the next four years. The proportion seeking full-time employment in this period was: 2008 16.9 per cent; 2009 10.2 per cent; 2010 9.0 per cent; 2011 7.2 per cent. In other words, even four years after they completed their course, 7.2 per cent of graduates from the class of 2007 could still not find a full-time job.

Among these statistics are indicators of the consequence of choosing the wrong course. In 2011 the academic fields with the highest rates of new graduates under twenty-five still seeking a full-time job were: Visual/Performing Arts 47.8 per cent; Life Sciences 42.3 per cent; Social Sciences 39.7 per cent; Psychology 36.9 per cent; Humanities 36.3 per cent; Agriculture 35.5 per cent; Languages 35.5 per cent; Mathematics 33.1 per cent; Chemistry 30.2 per cent (all fields 25.7 per cent).

Moreover, these raw figures mask an even more disturbing reality. Many of the graduates who actually gained full-time jobs were not working in the area for which they trained. Fields where the qualification gained by graduates in 2008 were not important to the job they eventually held in 2011 were: Natural and physical sciences: 46.1 per cent; Creative arts: 44.9 per cent; Society and culture: 29.8 per cent; Information technology: 29 per cent; Management and commerce: 28.9 per cent; Agriculture and environmental studies: 27 per cent. In other words, a vast amount of education and training is being vocationally misdirected.

Even more tellingly, when the class of 2008 was asked in 2011 whether, if given the hypothetical chance to study the same degree at the same institution again, they would do so, large numbers said they would not. Among those still unemployed, it was not surprising that 58.7 per cent said no, as did 55.1 per cent of those still in part-time or casual jobs. But even 38.1 per cent of those in full-time employment said they would not do the same course again.

In short, if you believe, like the Gillard government, that the central purpose of universities is to provide skilled and professional workers for the economy then the current system is already failing its students. Yet there is no sign that those in charge either recognise there is a problem or have any idea what to do about it.

It doesn’t take much statistical expertise or need any computer modelling to pick the most likely group in the future to fare the worst in the competition for graduate jobs. It will be those young people in that big new group who Gillard and Evans have just enticed into university with Year 12 scores between 50 and 70. They will swell the pool of existing unemployed, partly-employed and disaffected graduates. Instead of Gillard’s vision of liberation through education, with children of the poor and disadvantaged being elevated to the professions, we are probably witnessing a tragedy in the making: a generation of young people promised a world that cannot be delivered.

At best, the most that the 40 per cent degree target will generate is the phenomenon of credentialism, where jobs that once required only a little on-the-job training are upscaled to degree status. The public sector has been doing this in administrative positions for a long time now, and will continue to be the chief offender. At worst, Australia will eventually produce its own pool of resentful young people, especially in the outer suburbs, bitter about how they were duped and angry at the world, just like their university-educated counterparts in Europe and the Middle East.

The most serious outcome of all this, though, will be the further corruption of the university, an institution that is essentially elitist, and whose admission standards should not be easy but difficult. Universities that enrol students on the basis of socio-economic status abandon their traditional and only proper goal, the pursuit of scholarship, and become little more than expensive institutions for social therapy. They should not be surprised to find one day that they have thereby undermined not only their former status but also the demand for their services.