Undergraduate recruitment – no justification for cuts?

Executive summary:

The basis of the prediction that we all – UCU, the employers and those of us in the union organising a fightback – have been working to was that we faced a small but significant drop in student numbers (around -2%) pushing some universities into financial difficulties.

This prediction has turned out to be false.

We face questions of how students are allocated to universities following the A level U-Turn, but overall, the predicted financial crisis facing universities has shrunk to what UUK and Million Plus say is a £100m hole for some universities that have lost out in the post U-Turn scramble for places. This figure is tiny in comparison with overall sector finances, and could easily be met by a government that earmarked £500bn for furlough.

No justification for job cuts predicated on student recruitment

Looking at the UCAS website, we can get a rough idea of where home undergraduate student applications are in student enrolment. At this stage UCAS data (home and EU) indicates undergraduate applications are 2-3% up from last year overall. Given that most universities were planning on the basis that student numbers would fall with Covid this is notable.

As Anna McKie, writing in Times Higher Education comments, “predictions of swathes of students wanting to defer because of [Covid-19] have not materialised”.

  • 652,790 students were registered as applying for university through UCAS in June 2020. By contrast, in 2019 there were 638,030 students in the system (an increase of over 2%). What no-one knows for sure is whether this trend will be reflected in more students coming through Clearing, but signs are positive. At the end of Clearing last year, 495,620 students were placed.
  • As of Sept 2nd, of those 652,790 students, 503,410 have confirmed places. If current trends are maintained, that figure should rise to around 510,000 by the end of September.
  • For those folk who like a graph, see below. The graph compares student enrolment rates through Clearing, sampled at the same point over the last ten years.
  • Thus we can see that, breaking down data by country of origin, UCAS data shows international student placements up by 20% on the average of the last 10 years, and 6% up from 2019. (However, some caution is needed. UUK report that most international students do not apply through UCAS, so these figures may simply reflect an increase in the use of UCAS.)
  • Scottish applications are up; Welsh applications are slightly down. But by far the largest proportion of UCAS placements are from English students (364,500), not shown in the graph. Their numbers are up by 2% on a 10-year average and 3.3% on last year.
UCAS data, year-by-year comparison, at the same 20-day enrolment point, excluding England (at around 10x the amount, this is off the top of the graph). Source: UCAS
UCAS data, year-by-year comparison, at the same 20-day enrolment point, excluding England (at around 10x the amount, this is off the top of the graph). Source: UCAS.

Employers’ bailout call falls to £100m, as expected crisis diminishes

The employers’ organisations UUK and Million Plus are now lobbying the Government to call for a more straightforward bailout system, John Morgan reports in the Times Higher Education.

They estimate as little as £100m would be needed even if every “lost” student’s fees were paid in full for each year of a three year course. The employers are calling for grants not loans, and for the abolition of the ridiculous strings that the Government was seeking to impose.

To set this number in context:

  • A bailout of £100m would obviously be trivial compared to the £500bn the government set aside for furlough and support for the self-employed.
  • Useful points of comparison within sector finances are the £12.6bn paid out in tuition fees for home students in 2019 (out of a total of £18.9bn), or the student loans written off by the Treasury each year as unrepayable (about £7bn, or 70 times the amount).

So what should we conclude?

I heard a number of times during the VP and LGBT+ hustings from other candidates that (a) the Higher Education sector is in dire financial straits and (b) we shouldn’t press for a pay rise, and that perhaps some job cuts are inevitable.

The London Economics Report for UCU has influenced many. In that report, the authors predicted a 2% fall in undergraduate domestic student recruitment this year:

  • Combining these estimates with the above OBR economic forecast (indicating that UK GDP growth in 2020 will be approximately 14.8 percentage points lower than in the previous year (i.e. in the absence of the pandemic), we estimate that, on average, there would be a 1% increase in first-year full-time enrolments in 2020-21 (compared to the baseline), an 8% decline in part-time enrolment, and an overall 2% decrease in domestic students enrolling in higher education institutions (equivalent to 11,550 students).

The authors then plotted the impact on university finances. This is not the only factor looked at by London Economics, but it is a key one.

The reason is obvious. Undergraduate student fees are backed by the Treasury, and provide income over three years. At a rough cost per student of ~£7,000 each per year, they yield a healthy surplus. Given the many fixed costs for a university, a 1% difference in student numbers has a far greater impact on finances.

But on the basis of enrolments we are now looking at a 2-3% rise, a difference of more than 25,000 students.

This is a very big deal. More students means more fees, but also full halls of residences (with all the social distancing problems that arise, but full nonetheless).

I always opposed the idea that we should trade pay for jobs. But now that student enrolment data are coming in, any argument for members making concessions on the basis of an expected fall in undergraduate student numbers has collapsed. True, we don’t know what will happen to postgraduate recruitment, but the signs here are also quite positive, with a small number of students seeking to defer. For some students, the idea that teaching will be possible online is making universities more attractive, not less. But it is too early to be sure.

UCU could simply support the straightforward bailout system posited by the employers. The Higher Education sector would carry on doing what what it does so very well, research and education.

But I think we should go further, and call for a programme of additional emergency student places and funded bursaries for students from working class backgrounds.

As professor of government practice at the University of Manchester Andy Westwood said, ministers who have attacked Higher Education expansion and criticised “low value” courses should remember two key aspects of the work done by lower-tariff universities when considering a support package.

  • First, these universities were bailing out young people and ministers in that initial phase after exam results were published.
    Second, these are universities serving towns, cities and communities that need all the help they can get. This, of course, is the [Government’s] ‘levelling up’ agenda and the need to find ways to revitalise communities, incomes and life chances in towns and cities particularly in the north and the Midlands.
    So, there are issues of both honour and political pragmatism here.

Given a looming rise in unemployment, it is time to campaign for Higher Education as an essential public good.

Or, as the National Union of Students used to say, “If you think education is expensive, try ignorance.”

In the meantime, UCU members should be prepared to fight for every job. The money is there. We want our share.

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