Linking funding to employment could have perverse consequences

Posted By TEU on Jul 22, 2010 |

TEU Tertiary Update Vol 13 No 27

Data recently released by the Ministry of Education highlights some of the dangers in the minister of tertiary education’s proposal that funding be linked to employment outcomes. Statistics relating to the impacts of tertiary education on life after study show, for instance, that people with masters level qualifications have a lower employment rate that those than people with honours qualifications. Likewise, the employment rate of people with doctorates is no higher than those with honours qualifications.

TEU national president Dr Tom Ryan says it would be absurd to assume that there is limited value in masters study just because there is not an easily quantifiable employment outcome – yet that may be the signal that a poorly designed funding mechanism could send to tertiary institutions.

Such a development would be especially unfortunate given the Tertiary Education Commission’s current focus on encouraging, and even rewarding institutions for, increases in the numbers of post graduate students.

However, Dr Ryan suggests that the greater concern would be an unintended pressure on institutions to abandon their equity goals.

Currently Māori, Asian and Pacifika peoples with tertiary education qualifications have lower rates of employment than their Pakeha peers with the same level of qualifications.

While it is unlikely that any institutions would want to start enrolling Pakeha students  (who have statistically higher employment outcomes) over students from other ethnic backgrounds, that is a potential outcome of a funding system that would reward tertiary institutions on the basis of employment outcomes.

“The minister will need to be careful to avoid the unintended consequences of a proposal that sounds good as a sound-bite, but in practice could well be inherently complicated and unfair,” said Dr Ryan.

“Mr Joyce also needs to remember that his government’s Tertiary Education Strategy specifically calls for increased numbers of Māori and Pasifika with tertiary qualifications, not for fewer”.

Also in Tertiary Update this week:

  1. Employment law poses risks for tertiary institutions
  2. Tertiary education not just about employment
  3. Enrolment caps spelling end for equal access
  4. NZ and US move closer to trading private education

Other news

Tenders for the first public private partnership schools could be called as early as next year, it was announced today. Education minister Anne Tolley and infrastructure minister Bill English said the private sector would be responsible for financing, building, managing and maintaining the school property for a set term, while the Government would still own the land and the board  of trustees would remain in charge of its governance and day to day running – Stuff

Postgraduates and overseas students have slated a key discussion paper that canvasses reducing overseas student numbers from specific countries to counter race attacks. “It’s tantamount to advocating a return to the White Australia policy of the early 20th century,” Council of International Students Australia president Robert Atcheson said –The Australian

Female students wearing a full face veil will be barred from Syrian university campuses, the country’s minister of higher education has said. Ghiyath Barakat was reported to have said that the practice ran counter to the academic values and traditions of Syrian universities – BBC

Even as they cope with diminished budgets, Irish universities also face increasing enrollments, driven both by demographics and the recessionary trend of people returning to education in the absence of jobs. The combination has prompted warnings that, when the academic year begins this autumn, students will encounter overcrowded lecture halls and curtailed student services. Financial constraints also risk imperiling Ireland’s success at attracting top international talent, which has been deemed a central plank in the country’s “Smart Economy” strategy for fostering economic revival through research, innovation, and commercialization –The Chronicle

A huge chunk of the Universal College of Learning’s (UCOL) student services fee subsidises the library, computers and health care. Tertiary Education Minister Steven Joyce has questioned the legitimacy of student fee rises across the sector. He has cautioned institutes against using the add-on charges to subsidise core services that should be funded through tuition, including library and internet services. Tertiary institutes have bitten back, saying fees rises are essential as demand for services increases – Manawatu Standard

NZQA is targeting 42 PTES that have not met a June 30 deadline for filing papers relating to their accounts and quality processes. If they don’t supply the data they might lose their registration –Education Directions

TEU Tertiary Update is published weekly on Thursdays and distributed freely to members of the Tertiary Education Union and others. You can subscribe to Tertiary Update by email or feed reader. Back issues are available on the TEU website. Direct inquiries should be made to Stephen Day, email:

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