We’re not in a “higher education” bubble, we’re in a “certainty” bubble

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Peter Thiel, former CEO of Paypal, Facebook investor, and likely fan of Ayn Rand, suggests that the market value of Higher Education is far above any real value, and that we should expect a crash in demand for HE as the market restores itself to equilibrium. Anya Kamenetz has been talking about this for far longer, and I think is basing her position on a similar argument – though I’d argue that she’s saying that HE needs to self-reconfigure to survive a market correction rather than flat out predicting doom and destruction.

The real story here is that the link between higher study and higher earning is breaking down. Do download (and play with) the tables here from HESA. Between 2007-8 and 2008-9, the mean graduate salary for those who graduated from a full-time undergraduate course and found work in the same year was £19,500, whilst the national average salary was around £24,908.

A UK graduate can expect to earn an average of £100,000 more over their lifetime. Under current arrangements, you could offset £21,198 of debt against that, with £9,000-a-year fees taken into account, more like £40,000. Add loan interest on, take inflation into account, and you’re really talking about comparatively little (if any) gain.

At some point we are going to have to stop and ask ourselves whether higher education is an economic good. Whether we can justify individual educational expenditure by economic gains. We will answer no, apart from very specific job-linked training. 

And even then – given the pace of change around technology, the ways in which what we work on and how differs even from the start of the century, these gains are at best temporary. We are entering the age of ubiquitous lifelong learning, not just as a choice but as a requirement. I’d argue that this is a separate sector to traditional HE, and traditional HE may not be best placed to serve it.

Yolande Knight, from the GEES subject centre and EDOR OER project, postulates that what HE is about is uncertainty:

“At its most basic level, it was agreed that it could seem counter-intuitive for students to move from the ‘certainty of knowledge’ that seemed
to be taught at schools to the idea of ‘uncertainty’ that was introduced at university. However, it is important that this perceived ‘lack’ of understanding at school level is not assumed: it seems an easy scapegoat.”
(Knight, Yolande “Knowledge, evidence, complexity and uncertainty: a summary” (Planet no. 17, December 2006)

The recently fashionable Neo-Classical model of economic thought is lead by ideas of certainty and “know-ability” – the idea that all information is available and all risks are calculable (and insurable). I can’t really bring this up without mentioning that this might not have worked very well in recent times, though this feels a bit like a cheap shot. The education market is suffering from this same malaise at the moment – we’re teaching certainty – we’re teaching (or claiming to teach) based on “full and relevant information” (after Weintraub). 

But (and I’m with Keynes here): the world isn’t like that, and neither is education. Especially as we reach the higher levels of education, we (as academic and quasi-academic staff) do not know what it is our students will need to know. Keynes builds uncertainty (and thus flexibility and contingency) into his economic model, not via the management and “measurement” of risk, but via the acceptance of the existence of an unknowable future.   Mark Johnson has been writing about Illych’s idea of “useful underemployment” which seems to be a very relevant model if resilience in this interpretation of education.

What do students need to know? We don’t know. In such a situation, the only rational behaviour is to teach them how to find out for themselves.

And the next stage is to work out how to convince everybody else.

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