Low unemployment and border closures take a toll on tertiary education
AUT vice-chancellor cites a significant drop in international students, alongside growing inflation, economic pressures and a “buoyant employment market” as driving a proposed restructure.
Mōrena and welcome to The Bulletin for Tuesday, September 6, by Anna Rawhiti-Connell. Presented in partnership with Z Energy.
In today’s edition: why it took so long for victims of abuse in state care to be heard; Pharmac responds to independent review; the United Kingdom has a new prime minister; but first, what’s being blamed for the plan to make 5% of staff at AUT redundant.
AUT's city campus, Auckland (Photo: Supplied)
Drop in international student numbers and economic headwinds given as rationale for job losses
On Friday, prime minister Jacinda Ardern was at the University of Auckland to welcome back international students. A couple of hundred metres down the road, vice-chancellor of Auckland University of Technology (AUT) Damon Salesa was likely preparing for yesterday’s announcement that outlined restructure plans in which 5% of staff at AUT may lose their jobs. Salesa cited a significant drop in international students, alongside growing inflation, economic pressures and a “buoyant employment market” as driving the proposed restructure. The Herald’s Akula Sharma breaks down which departments are being asked to reduce staffing numbers.
Risk of reliance on international students flagged in 2019
It’s a marked contrast to 2019, when AUT reported a 9% increase in international student numbers and mentioned the construction of student accommodation as important in its bid to continue to attract international students. Almost every annual report from every university in 2019 cites similar increases and drives to continue international student recruitment efforts. In 2019, then tertiary education union (TEU) president Michael Gilchrist said such a high level of foreign enrolment posed serious financial risks. In some accurate foreshadowing, Gilchrist also said: "There's the risk of shocks such as the Asian crisis or a financial crisis or bird flu or something like that.”
Low unemployment rate driving lower enrolments at tertiary institutions
None of this foreshadowing will be comforting to the staff that face job losses. TEU president Tina Brown said staff were shocked and said it was short-sighted at a time when we’re needing to grow the number of skilled workers. A tight labour market means people can hop straight into a job or a funded apprenticeship. It’s a challenge Australia is also grappling with as this Australian Financial Review article points out. The low unemployment rate was given as one of the reasons for Te Pūkenga’s deficit. Staff at Te Pūkenga are still awaiting their fate after consultation wrapped up last week. National’s tertiary education spokesperson Penny Simmonds said any new structure through which savings will be achieved was likely to involve redundancies.
$230m for apprenticeships while AUT says it needs to cut staff costs by $21m
The correlation between tertiary qualifications, productivity and wage growth was challenged by a BERL paper in 2021 titled “Does New Zealand need so many young people studying for a degree?” It found little correlation between being tertiary qualified and growth in productivity or wages, while also noting shortages of skilled labour have persisted. Research done by BERL in 2019 found people who had completed a technical apprenticeship had significantly greater earnings than those who had gained a Bachelor of Science after 15 years. The government has had a big focus on apprenticeships lately, extending the apprenticeship boost scheme until the end of 2023, with a $230m investment in a pre-budget announcement this year. AUT’s restructuring proposal is based on having to cut staffing costs by a tenth of that figure.
This month we’re celebrating eight years of The Spinoff. We’ve come a long way since 2014 and that is in no small part thanks to our members – we literally wouldn’t be here today without them. Their generous support underpins all our work and has meant we are able to cover more areas of life in Aotearoa, to tackle more stories about our people and issues impacting our communities. From our ongoing coverage of inequality and the cost-of-living crisis, to political reporting and our focus on te ao Māori, it’s important mahi and we can’t do it without you. Let’s keep a good thing going - tautoko mai, donate today.
The quarter million
Today we launch the first of a year-long series looking at the royal commission of inquiry into abuse in care. It’s named for the 250,000 children and young people estimated to have been abused and neglected by state and faith-based institutions between 1950 and 1999. The Spinoff’s Reweti Kohere has spent months working on this comprehensive piece that, with compassion and rigour, examines how we got here, why it’s taken so long for the inquiry to take place and the history of state care. As Kohere writes, the ongoing public facing hearings are not an exercise in questioning the validity of survivor experiences but an examination of why child abuse persisted as a stain on Aotearoa New Zealand for so long. It is detailed, thorough and important work. It may also be difficult to read, so take care.
Pharmac respond to review
Three months after an independent review of Pharmac was released, the agency has responded. Pharmac chief executive Sarah Fitt spoke with Stuff’s Rachel Thomas. The review found Pharmac needed to substantially lift its performance and outlined 33 recommendations for change. The government accepted 31 of the 33 recommendations made in the review. Fitt said Pharmac will supercharge its commitment to Māori and diverse communities but that change needs to be funded by the government. The agency is currently working on costings to implement the recommendations ahead of a bid for Budget 2023.
In this week’s edition of Stocktake, The Spinoff’s business newsletter, Chris Schulz looks at an award-winning New Zealand export business that is 'the ultimate barbecue conversation starter'. For insight, inspiration and news you can use if you’re in business, sign up to Stocktake. A new edition, fresh out each Tuesday. Subscribe now and it will be in your inbox at 8.30am this morning.
In Truss Britons do not trust
As expected, Liz Truss is the new prime minister in the UK. Toby Manhire has a two minute guide to the woman Tories have installed at No 10 and what it means for New Zealand. Truss won the Conservative party leadership race with 57% of the vote from party members beating out former Chancellor of the Exchequer Rishi Sunek. As Manhire writes, polling by YouGov published this week suggested only 12% of Britons think Truss will be a great or good prime minister. More than half expect her to be poor (17%) or terrible (35%). Prime minister Jacinda Ardern extended friendly congratulations to Truss last night. But have we seen the last of Boris? Manhire thinks not.
Click and collect
Calls for bowel cancer screening age to be dropped to 45.
Te Pāti Māori calls for independent inquiry into emergency housing in Rotorua.
To infinity and beyond: government make $16m investment in aerospace sector.
Crown delivers closing statements in political donations trial.
The world's loneliest tree and how it’s helping advance climate change research.
Got some feedback about The Bulletin, or anything in the news? Get in touch with me at thebulletin@thespinoff.co.nz.
If you liked what you read today, share The Bulletin with friends, family and colleagues.
A formal apology to the big worm we said should go "straight to hell" in Live Updates last week. Tom Logan of the University of Canterbury explains his project ranking New Zealand's most walkable towns and cities. Jonny Potts delves into the mascot situation in the children's ward of Wellington Hospital as beloved "Hospi the lion" faces the chopping block. Ruth McKie has some easy actions that can lead to big change this Conservation Week.
Cricket!
I’ve batted my way through rugby analysis to bring you news of the one-day series that starts tonight between the Black Caps and Australia. Cricket at this time of year is somewhat unusual but fans of small round ball sports will be grateful for a drop of rain in an oval-shaped desert. The series was originally scheduled for early 2021 but has been postponed twice because of Covid border restrictions. Play starts at 4.20pm (NZT) in Cairns. Stuff’s Andrew Voerman writes that we haven’t won an ODI in Australia in a decade and it could be the last chance for many current Black Caps to have a crack at winning the Chappell-Hadlee Trophy.
“Eats, hops and breeds”
That headline is a work of art and, I assume, a homage to grammar extraordinaire Lynne Truss. It’s from a feature by The Guardian’s Eva Corlett on New Zealand’s worsening wallaby plague. Corlette heads out with hunter Pete Peeti as he tries to make a small dent in a wallaby population that's now estimated to have infested 1.5m hectares in the South Island. Up to half a million hectares in the North Island are also infested with the imported marsupial that was brought to our shores by governor Sir George Grey.
Universities have not adapted their product to the changing world fast enough. The fact that they are charging for a product which does not result in a better outcome vs those who do not buy their product is not acceptable. I could have learnt all of my marketing qualification content, for free online in six months, and that was 20 years ago. Now, the quality of education available online for the softer skills such as management, marketing, commerce etc is high - but you dont' get the 'stamp of approval' at the end.
They also keep creating qualifications which serve only to benefit them not the student - outdoor adventure qualifications for example. they will never pay off with a well paid job, but my creating a qualification, it means employers think a candidate should have it. Whereas in reality, I imagine one could 'apprentice' this type of job along with many others.
Problem is, it's the worlds socially acceptable Ponzi scheme.