The revolution to reinvent the university has begun according to the Economist, the UK’s weekly newspaper. Three forces are reinventing the university: rising costs, changing demand and disruptive technology.
Higher education, The Economist argues, suffers from Baumol’s disease – the tendency of costs to soar in labour-intensive sectors with stagnant productivity. Whereas the prices of cars, computers and much else have fallen dramatically, universities, protected by public-sector funding and the premium employers place on degrees, have been able to charge ever more for the same service. For two decades, the cost of going to college in America has risen by 1.6 percentage points more than inflation every year.
The second driver of change is the labour market. In the standard model of higher education, people go to university in their 20s: a degree is an entry ticket to the professional classes. But automation is beginning to have the same effect on white-collar jobs as it has on blue-collar ones. According to a study from Oxford University, 47 per cent of occupations are at risk of being automated in the next few decades. As innovation wipes out some jobs and changes others, people will need to top up their human capital throughout their lives.
By themselves, these two forces would be pushing change. A third – technology – ensures it. The internet, which has turned businesses from newspapers to music upside down, will upend higher education. Now the MOOC, or Massive Open Online Course, is offering students the chance to listen to star lecturers and get a degree for a fraction of the cost of attending a university.
See article: Hard lessons ahead for higher education, the Australian Financial Review