All Posts Tagged With: "2009 Recession Cuts"
The academic labour market never gets any breathing room
It wasn’t that long ago when the Association of Universities and Colleges of Canada was predicting that we would need tens of thousands of extra PhD graduates. It was reasoned that growing demand for university combined with a mass exodus of baby boomer professors, would create a glut in the academic labour market. The message to government was fund more grad school spaces. The message to students was, forget about all that negative talk of spending five years in a doctorate program only to wind up in temporary sessional appointments. Now is the time to get that PhD.
It is not very novel to point out that, in light of the past year-and-a-half, this scenario seems like a sad joke. Students are indeed piling into grad programs, but largely as a relief from a brutal job market. As financial trouble appears to be dialing down in other sectors, problems continue unabated in the higher education sector. Universities have been making changes in response to economic realities that will ensure that a tight academic labour market will remain the norm long after the overall job market recovers.
As one illustration, the Modern Language Association recently reported that there has been a 51 per cent decline in available English positions over the past two years.
Many institutions have said that they will leave open positions unfilled, which can be accomplished by relying on sessional instructors and eliminating small classes, while they wait to see what their respective provincial governments do with respect to funding.
Some universities are picking fights with faculty unions. And unions are having none of it. At Queen’s, the administration requested that faculty take a two per cent pay cut, which was rejected by a vote of 89 per cent earlier this month. Last week, the Lakehead Faculty Association protested administration imposed furlough days, stating in a release: “Employees should not be made to suffer because administrators are unable to manage university finances.”
Unfortunately, this unwillingness to make concessions may lead to even more drastic measures. Forget pay cuts and furlough days, the days of “voluntary” retirement have already returned. Only a couple of weeks after the faculty union at the University of Alberta agreed to discuss the possibility of unpaid days off, the administration announced that it will be offering voluntary retirement packages, the Edmonton Journal reported on boxing day. The U of A has not ruled out outright layoffs, as have happened at other schools.
For example, the British Columbia Institute of Technology has announced that it will layoff five per cent of its staff in the coming year. Layoffs have been announced at the University of Calgary, and Guelph to name a couple others. We should expect much more carnage in the spring as universities finalize their 2010-2011 budgets. While it is easy to blame the economy, or the government, universities while crying cash poor over the past decade have, apparently, not taken many steps to prepare for downturns.
Though voluntary retirement may seem more humane than outright layoffs, it signals much deeper financial troubles than a simple trimming of the labour budget. Begging people to give up their jobs is never a good sign.
The voluntary retirement package was a common theme of the 1990s that, combined with leaving positions unfilled, led to a 10 per cent reduction in the total number of faculty across the country. It took years for the academic labour market to recover. The hiring spree across campuses during the early and mid 2000s was largely a move to reinstate positions lost during this period. The AUCC thought that this trend would continue well into the next decade. That’s just not going to happen.
This is compounded by the fact that, when given the choice, baby boomers simply won’t retire at the rate we have expected them to. It hardly bears mentioning that one of the great ironies of the recession is that while it has encouraged students to recede into PhD programs, it has also ensured that they might not have anywhere to go when they finish.
Justifying the university means justifying what universities do, not what we want them to do
Over at University Affairs, deputy editor Léo Charbonneau, recently asked his readers for their thoughts about protecting universities against the possibility of massive cuts to higher education. He asks, “What’s the best line of argument to protect universities from the cuts to come?”
Charbonneau poses the question after reviewing an article by Paul Wells written for the alumni mag at Wells’ alma mater (see here, page 46). Wells, one of the few national columnists who thinks higher education is worth talking about, admonishes the idea that university administrators should take a pragmatic approach to protecting their funding.
Administrators like to emphasize the economic impact of higher education. Universities are special, they argue. Not only do they contribute to economic activity in the here and now (like every other large employer) but they make our workforce more productive, and contribute to job creation across the entire economy, and in the long term, in ways that no other sector can. Give them more money and we will get more economic growth as a result. ( The Association of Universities and Colleges of Canada made this very argument in its pre-budget submission to parliament’s finance committee).
Such a line of argument would be great for universities if it were true, or, if it is true, if it could be proven. Unfortunately this is not really the case. As Wells writes:
The problem with that line of argument is that in a really nasty economic environment, governments on a tight budget will take that as a cue to go hunting for anything a university does that doesn’t, demonstrably, simplistically, generate the ideas that drive a new economy. Whatever they find that looks like a ‘frill’ by that definition will be in danger of getting cut. And frankly, most of what goes on at a university is hard to justify as part of a job-creation mill.
Charbonneau takes issue not with Wells’ analysis, but with Wells’ conclusions that universities “need to go back to basics and talk more … about the intrinsic value of knowledge, scholarship, beauty, contention, and an environment that urges scholars toward ambition and accomplishment.” Charbonneau finds Wells misguided, and says he doubts “whether it’s the type of argument that our current governments will buy into.”
Though Charbonneau does not come right out and say it, it seems obvious that he sides with the view that universities should adopt a pragmatic approach and tell governments what they think governments want to hear.
It should be obvious that Wells is correct on this question.
Of course current governments are not going to buy into the argument that universities are justified by their core activities of teaching and learning. No one ever bothers to make the case to them. Instead universities act ashamed that they investigate the origins of the universe, or competing views on Milton’s Paradise Lost, and emphasize what are in actuality only incidental outcomes of higher education.
The logic of academia is internal, meaning its impact on the rest of society cannot be predicted or planned. And, if we start trying to plan it, then what made academia unique withers away. Taking the pragmatic approach does not convince governments to value higher education, it concedes the terms of debate to those who think intellectual pursuits are all about direct economic outcomes. What happens when people start looking for this return?
A more appropriate way to view universities might be something similar to how we view public spending on the arts. As a certain prairie based education writer put it earlier this week:
[T]he public is not stupid, and universities should not be so sheepish about what they do. If universities announced that they were no longer going to study ancient history, or the origins of the universe, or Shakespeare, then the public would likely be distressed.
After all, we support public funding for the arts because of the intrinsic good they are thought to confer on the community. Why not teaching and learning? Like the arts, higher education is a luxury of wealthy societies to be appreciated, not as a means to solve all our problems or to be debased on utilitarian grounds.
If schools want to justify themselves, or demonstrate their relevance, they have to show us what it is that they uniquely do.
To be sure, such reasoning puts schools at risk of being dismissed as frivolous, but it doesn’t have to. Higher education advocates should learn to own the debate and not be afraid to talk about what they actually do.
Budget deficit years in the making
Come January, five per cent of jobs will be axed at the B.C. Institute of Technology to make up for a $12 million budget deficit. According to the Vancouver Sun, BCIT president Don Wright broke the news to the school’s 1,700 full time staff at a meeting Wednesday afternoon. The cuts will affect 82 positions from all sectors, including faculty, support staff and management, but exactly which jobs will be eliminated is yet to be determined.
“Salary and benefits are a little more than 70 per cent of our budget. It would be pretty hard to imagine how we could eliminate a deficit without eliminating some positions,” Wright told the Sun. While enrollment is up at BCIT the province has said it will not provide any additional funds in 2010.
However, unlike administrators at other institutions, Wright is reluctant to blame the government for the Institute’s financial woes, and recognizes that internal decisions related to resource allocations need to be rethought. He was quoted in Burnaby Now saying, “I would not blame government for this and we have more students this year than last year. Some patterns of spending have been developed over a number of years, and now we need to try and correct them.”
Stephen Howard, communications officer for the B.C. Government and Service Employees’ Union told the Sun that the cuts are a “contradiction.” He says that “the economic downturn is upon us and more and more people are turning to post-secondary institutes like BCIT in greater numbers to get the training they need to try and get employed as the economy rebounds, and now key courses and services at this institution won’t be available to them.”
U of T has seen a 12 per cent increase in financial aid applications
The number of requests for student financial aid is on the rise in Ontario after a dismal economic year for young people, and university officials say it could be just the start of a flood of applicants that will wash over universities this fall.
“The messages we’re getting from students and their families is that the parents may have had full-time jobs in the early part of 2008, but things happened in 2009 and parents now have lower incomes this year,” said David Sidebottom, manager of financial aid services, admissions and awards at the University of Toronto, as he explained one reason for the increase.
The university has seen a 12 per cent increase in financial aid applications for the school year.
“Parents’ incomes have taken a hit in some cases,” said Sidebottom, who has been fielding calls from anxious students who’ve also struggled to find jobs to pay for their pricey education.
“Students have been having trouble finding full-time jobs going the whole summer,” said Sidebottom, adding that the municipal strike in Toronto also affected students relying on work with city run programs.
Ontario Student Assistance Program applications are up 5.7 per cent this year for colleges and 4.6 per cent for universities, said Patrick O’Jorman, a spokesperson for the Ontario Ministry of Training, Colleges and Universities.
“It corresponds to the total number of applicants to schools,” said O’Jorman, who said university applications are also up five per cent.
Last week’s job report also painted a bleak picture for young people, showing a record student unemployment rate of 21 per cent in July.
For Rodney Diverlus, a 19-year-old student from Ryerson University, the challenge to find a summer job to pay his $5,500 tuition as a dance major was daunting and the choices were sparse.
Diverlus, who had worked for event planning organizations and NGOs in previous years, said he hoped to return to similar work, but his summer job became obsolete.
He said months of perusing job posting websites and following possible leads yielded scant results.
“There are moments where you get angry, and there are moments where you ask yourself could I have done more, but after applying for so many jobs, I don’t know,” said a frustrated Diverlus, who had no intention of applying for OSAP this year, but was forced to take out a student loan to pay for school.
Most lost jobs expected to be in operations, trades, advisory and technical positions
According to The Calgary Herald, University of Calgary has announced it might have to cut up to 200 job by September.
In an internal memo circulated Tuesday, school president Harvey Weingarten says the university needs to trim its budget by at least three per cent in all units and faculties in light of a $14.3-million shortfall. By law, the university is not allowed to run a deficit.
Weingarten says the cuts have primarily been caused by poor market performance caused by the economic downturn, which has adversely affected return on endowment funds that support various programs, plus the school’s pension fund. The endowment fund is down by $40.4 million, since hitting a last year’s high of $411 million.
“A significant portion of the university budget, approximately 60 per cent, pays for the salaries and benefits of our employees,” wrote Weingarten. “Given this reality, there is simply no possibility of ensuring that a balanced budget, once achieved, is sustainable unless we reduce our number of support and academic staff.”
Weingarten says he anticipates the school will have to cut the jobs of up to 200 people by the fall and that it’s likely there will be more reductions later. He says the actual numbers will depend on many factors, such as future government grants, tuition levels, endowment performance, salary and benefit settlements.
U of C’s faculty association president Anne Stalker told the Herald that staff members are “obviously very worried” about the job cuts and the long-term affect on programs.
“It makes it a less pleasant place to work,” she said. “They also think [the university brass] haven’t been thinking ahead. They should have planned more so it didn’t take everybody by surprise.
The greatest job losses are expected to effect the Alberta Union of Provincial Employees, which represents some 4,265 university staff in operations, trades, advisory and technical positions. “Of course, we don’t like it,” says AUPE president Doug Knight.
“The university has put a lot of their shortfalls on last year’s budget. A lot of the money lost is from the worldwide financial crisis, where it was inevitable something was gonna break. Their funding shortfall is because of endowments and they really shouldn’t be relying on endowment funding.”
For more on this story, click here.
For students 20 to 24, unemployment hits 14 per cent, the highest rate since 1997
In this story, published today, The Globe and Mail’s Elizabeth Church has some great anecdotes about students who are struggling in summer 2009′s tough job market.
Her article is timely, considering two studies that were recently released.
In Statistics Canada’s latest labour force survey, the agency found that compared with June 2008, employment was down 43,000 for students aged 20 to 24 in June 2009. That means their unemployment jumped 4.8 percentage points to 14 per cent, which is the highest June unemployment rate for these students since 1997.
StatsCan also found that the labour market for 17 to 19-year-old students is slumping. Employment for this age group was down 50,000 between June of 2008 and 2009. That brings their unemployment rate to 18.1 per cent, the highest since June 1998.
In another report released last February, the Educational Policy Institute predicted rising youth unemployment will add more than 105,000 new borrowers to the Canada Student Loan Program in the next three years. The study found that a one per cent rise in youth unemployment increases the demand for student loans by about six per cent.
Union offers alternatives to save 130 jobs slated to be cut as low-enrolment courses chopped
According to The Guelph Mercury, the union representing sessional lecturers and teaching assistants at the University of Guelph has presented the school with 14 possible solutions it hopes will save 130 jobs that are on the chopping block.
The CUPE Local 3913 members met with university administrators Tuesday morning and presented 14 solutions that they say are designed to minimize “negative impacts on union members.”
“We are hoping [the university] will come back with even better [suggestions],” says union chair Trudi Lorenz.
The cuts are slated in courses that have seen low enrolment. The university notified the union in May that the jobs would be eliminated.
The group’s staff representative, Toni Xerri, says many sessional lecturers rely on the jobs, which they have to apply for every four months to keep. “This comes as a devastating blow.”
The university has yet to respond to the union’s requests.
School dodged “Yale model” in favour of conservative investing and a secure cash flow
The Wall Street Journal is reporting on the curious case of one U.S. university that has avoided the crushing losses to its endowment fund suffered by other schools like Harvard and Yale. (And Canadian universities, too.)
That school is the 150-year-old Cooper Union for the Advancement of Science and Art, which charges no tuition, and is headquartered in New York City’s East Village neighbourhood.
From the sounds of it, the recent financial meltdown hasn’t made much of a dent — the school has nearly finished construction on a new $150-million academic building, is hiring for a new biology program, is launching an environmental-design institute and will soon debut a master’s degree program in architecture.
More: Endowments for Dummies
Three years ago, particularly keeping in mind the tech bust and 9/11, the university’s administration decided to reduce the risks in their endowment fund. They renegotiated a property lease to ensure an steady income, sold some land, raised some money and hired some conservative investment managers. The school’s $600-million endowment has subsequently stayed about the same — and may even be up a bit at the end of the school’s fiscal year.
Those results are markedly different from schools that used what a Cooper spokesman calls the “Yale model,” in which schools eschew stocks in favour of alternative investments like private equity, commodities and timber.
In comparison, most Canadian and U.S. universities are dealing with endowment losses between 20 to 30 per cent.
For more on this story, including more information on Cooper’s high-profile land holdings, click here.
Despite attempts to save money, university cites “extraordinary financial challenges”
The Boston Herald is reporting that, in the wake of a 30 per cent drop in its endowment, Harvard University will be laying off 275 employees over the next week.
“Difficult circumstances have called for difficult decisions,” wrote Harvard president Drew Faust in an e-mail, citing the school’s “extraordinary financial challenges.”
Since January, the school’s administration has tried to save money by cancelling travel spending, reducing discretionary spending, and freezing the salaries of 9,000 employees. Buyouts were offered to 1,600 workers; 500 accepted the offer.
According to an e-mail from the school’s vice president for human resources, the layoffs will be split between administrative and professional positions as well as clerical and technical workers. Forty other employees will see their hours cut.
“These steps have helped to keep the number of involuntary reductions as small as possible,” reads the HR e-mail. “Unfortunately, further cuts are needed in order for Harvard to adjust to the institution’s new economic reality.”
Golf, rugby, figure skating, cheerleading and baseball will be pay-to-play
According to The Record, Wilfrid Laurier University has decided to cut funding for eight of the schol’s less-popular varsity teams.
“If they are going to chop our budget, then the team is dead,” says volunteer golf coach Mike Belanger, who says he’s put about $30,000 of his own money into the team to keep it afloat. “We’ve donated our time and money for years to keep our costs down. I just don’t think we’d be able to cover and manage the whole thing on our own.”
Earlier this year, the university’s administration asked all departments to trim spending by five per cent this year and six per cent next year as the university tries to cut its operating budget by about $25.7 million.
Although the athletic programs will still be offered in the fall, golf, men’s and women’s cross-country running, men’s and women’s rugby, figure skating, cheerleading and baseball will be pay-to-play starting in the fall.
According to the school’s athletic director Peter Baxter, those cuts will save the school about $380,000.
For more on this story, click here.
University needs to find $1.2 million in cuts to balance its budget
According to the Winnipeg Free Press, Brandon University is going to leave five per cent of its professor positions vacant for the next school year.
Jobs won’t be eliminated, but 11 of 220 faculty positions will be left vacant next year, according to the school’s vice-president of finance.
The university needs to cut about $1.25 million, and is attempting to balance its budget by leaving the jobs vacant, digging into reserve funds and making a variety of small cuts across the school’s campus. For more, click here.
Under Schwarzenegger’s new plan, 77,000 grants totalling $180 million would be cut
The L.A. Times is reporting that California’s financial assistance program, which gives cash grants to low and middle-income university students, could be on the chopping block as the state faces a skyrocketing deficit.
The plan emerged in testimony by the state’s administration at a hearing today following Gov. Arnold Schwarzenegger’s turnaround on a week-old plan to borrow $5.5 billion to help balance the state’s budget. One nonpartisan analyst estimates the deficit at around $24 billion (USD).
Under the new proposal, 77,000 new grants costing $180 each year would be cut, but savings would eventually grow as high as $900 million as students graduate and the grants are phased out entirely.
Other programs at risk include the state’s main welfare program and health insurance for low-income families.
Fees will go up by 3 per cent, all departments will suffer budget cuts
Tuition at the University of Saskatchewan is going up by an average of three per cent.
The Saskatoon-based university also says it’s cutting costs to help slash an estimated operating budget shortfall of $10 million. The reduction means almost all academic and administrative departments will see cuts in their budgets.
Brett Fairbairn, a university spokesman, says the reduction is necessary because of the global economic downturn which has led to income shortfalls.
The university says tuition fees would have increased regardless of its financial situation.
Between 15,000 and 20,000 full and part-time students attend the university.
- The Canadian Press
Decision was made to protect what’s left in the school’s endowments
The Victoria Times-Colonist is reporting that investment losses at the University of Victoria have prompted the cancellation of bursary and scholarship payments for 40 per cent of the school’s endowment funds.
The decision was made to protect what’s left of the endowment funds’ principal, in order to ensure that UVic students will be supported over the years to come, says Shannon von Kaldenberg, associate vice-president of alumni and development.
This means that 60 per cent of the nearly 1,000 funds will continue to pay out in the next calendar year, until 2010. The remainder will be reassessed that spring.
The Times-Colonist estimates that hundreds of students will be affected. Last year, the university’s foundation paid out $5.4 million, but the annual return on investments used to pay for those awards have dropped about 18 per cent.
One donor, David Pollock, says he is “shocked and upset” to learn of the cancelled payouts. His bursary, set up in honour of his grandmother, has dropped from $64,000 to $55,000. If the university wanted to save capital funds, says Pollock, it shouldn’t have put the money in risky investments.
Spending limited resources helps rich students as much as poor
This year’s award for Worst Spin by a Politician in a Post-secondary Performance goes to …. insert drumroll… Premier Shawn Graham of New Brunswick!
According to a front page story in last Wednesday’s Times & Transcript, the province’s Liberal government is considering scrapping a planned universal $2,000 grant for first-year N.B. university students.
The grant was a campaign promise when the Liberals won the 2006 provincial election.
The fact the government is giving post-secondary education a hard look as it searches for ways to save money isn’t a surprise, nor is it a scandal. What is shocking, however, is the complete ignorance shown by the Premier in addressing the file and his lack of understanding of how to effectively spend public funds in order to improve access to education.
The Premier claims he has “an $8-million budgetary envelope” to spend in additional funds for post-secondary access. The Times & Transcript quotes him saying that money would be better spent on a tuition freeze.
New Brunswick’s student unions are calling on the Premier to aim that money towards those who need it most by creating a debt cap in the province. Capping debt was a recommendation from the government’s Commission on Post-Secondary Education, which recommended a cap of $7,000 per year.
Graham rejected the idea point-blank, saying his government can’t afford it. “New Brunswick would have been the only jurisdiction in Canada to move forward on such an initiative,” he told Times & Transcript.
The provinces of Ontario, Alberta, and Newfoundland and Labrador already have debt caps. The claim by Graham that New Brunswick would be the only province with such a cap is incorrect. Actually, using this as a measure, New Brunswick is lagging behind the other provinces.
Saying his government can’t afford to provide targeted support to students is incorrect as well. It’s not that he can’t do it, it’s that he prefers to provide the same levels of support to all students—from the richest to the most-needy—by freezing tuition and providing tax credits. Taking that limited pot of money and devoting more of it to lower-income students would make more sense.
This is another example of what’s wrong with post-secondary education politics in this country. Instead of good public policy, politicians try to win votes and get photo-ops from money that should be spent improving access.
Starting with this post, I will be tracking attempts by the provincial governments to save money during the recession by cutting post-secondary education. Doesn’t it feel like the early 1990s? Follow the tag: 2009 Recession Cuts.