Without government support, universities will struggle to provide the education people will need to rebuild their lives after Covid-19
Our universities are a vital and unique part of our society with an importance that far outweighs their considerable economic value. Yet research into the impact of Covid-19, conducted by London Economics for the University and College Union, shows that universities face a black hole of at least £2.5bn in fee and grant income for 2020-21 as students both in the UK and around the world defer or abandon their plans to study here.
The new analysis suggests that over 230,000 fewer students will enter higher education in 2020 as a result of the crisis, over half of which are international students. That fall in student numbers would translate into a drop in income of around £1.51bn from non-EU students, £350 million from EU students and £612 million from UK students opting to stay away.
Universities face a financial storm – that’s why we need government help | Alistair Jarvis
The report lays bare how vulnerable some of our most renowned universities are to falls in international demand, but also how widespread the financial pain might be. All 125 universities in the report would suffer substantial falls in income, leaving 91 (almost three-quarters) in a critical financial position where income only just covers expenditure.
Without a package of financial support from the government, the report’s authors estimate that over 60,000 jobs will be lost, both in universities themselves and in the local economies that surround them. Many of those jobs would be in places where the local university is amongst the biggest employers.
Students, staff and the communities that rely on their local university will suffer unless the government is prepared to guarantee the sector’s income in these unprecedented times.
The total cost to our economy of doing nothing is estimated at greater than £6bn. But this underestimates the problem as universities face further virus-related losses in other areas – for example from research income and activities like accommodation and conferencing. It also assumes that universities will actually be able to deliver teaching to all students from September – something which at this point is far from certain.
The £6bn figure also undervalues the key role that our universities will play in the UK’s post virus recovery. At just the moment when we need to be expending educational opportunities, a damaged university sector would make these hard to deliver.
This report makes the strongest case possible for the government to offer a straightforward guarantee to maintain current levels of funding for institutions, protect jobs and rule out the closure of any college or university.
Critics say that government should wait and see before making such a promise but hundreds of thousands of students, staff and their local communities need confidence now, not months down the line.
As well as the case for government intervention, we need to overhaul our marketised university system.
It is not widely known that our global reputation is powered by an army of university staff who do not have proper job security. Around 70% of researchers in universities are employed on fixed-term contracts, while more than 100,000 university teaching staff are on temporary contracts of one kind or another.
Equally, universities are so focused on competing with each other for bums on seats than they’re unable to build the shared future that would most benefit students and society. As the report makes clear, relying on the market to solve the current crisis would only lead to some universities winning at the expense of others.
UK universities fear huge budget holes as Chinese students stay home
We have already seen that “business as usual” leaves us all exposed. Just over a month ago, many universities insisted on carrying on with face-to-face teaching and even holding open days when staff were urging them to stop. How many institutions still think they made the right decision? We cannot get through this outbreak without far-sighted, responsible leadership.
The current system is not fit for purpose. It disincentivises universities from cooperating for the benefit of society and putting their students first. Yet those are the values that we will desperately need if we are to help everyone recover from the pandemic. We urgently need the government to get behind a coherent solution that protects our whole higher education system.
Jo Grady is the general secretary of the University and College Union