Select Committee on Education and Employment Minutes of Evidence


  The key issues concerning the issues of student retention rates in higher education (HE), the recruitment of academic staff and the quality of teaching and learning—and hence the student experience—can be coherently discussed with reference to the diagram below which presents a stylised picture of the HE process.


  The process starts with a flow of E students entering the system. Higher education itself can be thought of as a production process in which these E students are taught by a stock of academic staff (S). One key factor in the quality of this process, and hence the quality (Q) of the eventual output of N graduates will be the staff-student ration (SSR). Of course in the process there will be some early exit or drop-out (D). (Thus D/E is the drop-out rate and N/E the retention rate). Of these N graduates, A will decide on an academic career. Some of these will add to the domestic academic stock and others will form part of the brain drain overseas. The domestic academic stock is also added to by any inflow of academics from overseas.

  In this framework, there are four points where policy can influence things.

    —  The first is in relation to E. Policy that encourages increased participation in HE will increase E. Given the SSR, this will increase N.

    —  The second is in relation to D. Students may drop out for a range of reasons but the most important are student debt and failure. The first of these depends crucially on the nature of policies designed to mitigate the debt problem (both the absolute size of the debt and the cultural attitude to debt). The second of these is critically related to student support and guidance mechanisms in HE and the effectiveness of these depends to a considerable extent on factors such as SSR.

    —  The third critical point comes where graduates take career choices. There is overwhelming evidence that these choices are guided by relative earnings prospects. Over at least the last 10 years, the gap between non-academic and academic earnings has widened considerably. For example, in economics the differential in 1990 was 30 per cent but had grown to 56 per cent by 1998. So it is hardly surprising that the last three years the LSE has only attracted one UK student to do a PhD in Economics and the ESRC has seen historically low take-up rates for its postgraduate research awards in the subject.

    —  The fourth critical point comes when academics make the decisions on where they will work. Some UK trained candidates will move overseas and some trained overseas will move to the UK. Clearly this is a decision where relative earning prospects will be crucial. Again, if we take the case of a young academic economist, comparable data for 1996 show the US/UK salary differential was approximately 40 per cent. This gap is almost certainly wider today. Thus it is not surprising that this widening of international pay differentials has created problems for the replenishment of the UK's academic stock. By 2005 this replacement problem will "go critical" as the spike of academics recruited in the expansionary post-Robbins era retire.

  Thus retention, recruitment and quality in HE are first and foremost issues of resources. These need to be delivered on two fronts:

    —  Resources both to (a) provide a safety net that prevents debt driving students to exit and (b) fund a mechanism that makes debt bearable (eg delaying the date of payback either by setting a higher income exemption level or extending the period of grace).

    —  Resources to ensure that UK universities have the quantity and quality of academic stock (whether home grown or imported) to achieve staff-student ratios that can deliver the output of quality graduates that will assure the UK's competitive future.

Professor John Beath
School of Social Sciences, University of St Andrews, Royal Economic Society and Conference of Heads of UK Departments of Economics

25 January 2001

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