The last 50 years have seen many countries climb out of developing-country status. Could a country slip backwards?
Based on the status of its universities, New Zealand seems to be at risk of doing just that. The vice chancellor of the University of Auckland, Stuart McCutcheon, gave a presentation about New Zealand higher education last week at a meeting of Universitas 21, the international university consortium. The key image in his presentation: A cow so starved that its ribs showed.
New Zealand’s economy has grown more slowly than many others in the last couple of decades and the value of its currency has dropped. As I write this, the New Zealand dollar is 80 cents on the U.S. dollar, while the Australian dollar is at $1.05.
“New Zealand is becoming one of the poorer developed countries,” one university international director told me last year when I visited the country. That was before the Christchurch earthquake, which has been overshadowed by Japan’s natural disaster, but is sapping New Zealand’s economy. The New Zealand federal budget, released last week, gave the universities a 2 percent increase.
Manufacturing jobs are leaving New Zealand, as companies headquartered there move factories to Asia, Mexico, and South America. As manufacturing jobs leave the country, one opportunity remains for New Zealand universities: research and development jobs. New Zealand-based companies and multi-national corporations still seem to have faith in the innovation and design skills of the country’s researchers. New Zealand scientists say that their relative poverty has made them highly efficient, with low overhead, and that they are having relatively good success getting grants from U.S science agencies.
Some innovation is cramped because of the cost of access to the Internet. While universities have their own networks, private access can be expensive. One downtown hotel charged $30 a day last year—not a totally fair price indicator, but an indication of how expensive access can get. The saying “don’t try this at home” is true for broadband in New Zealand.
Much of the government’s money and support goes to students instead of to the universities, in the form of capped tuition, living stipends for students, and no-interest loans that wind up costing the government money over time. With New Zealand higher-education participation rates high, the cost to the government for its generosity to students is also very high, leaving little money to go to the universities to actually teach those students. The government’s position is that its aid to students helps foster economic and ethnic diversity in academe. (The cynical explanation is that the policy wins votes.)
The universities can charge more for international students, but with tuition and fees low for domestic students, universities feel like they can only charge international students so much without incurring resentment. With a small federally-fixed market of eight universities, New Zealand is highly vulnerable to any sudden changes that affect international student recruitment—swings in currencies, or incidents, like the ones that have occurred in both Australia and the United States, where unscrupulous private colleges stain the broader reputation of national higher education.
New Zealand is also vulnerable to headhunting. Australian universities in particular see New Zealand universities as a good place to search for talent, and Australian institutions can often offer better salaries. Imagine getting paid in a highly valued currency, and then going home to a cheap country.
On the international-relations circuit for universities, administrators watch what is happening in New Zealand with pained expressions. There’s much to like about the country and its academics. They are smart yet humble and were racially tolerant long before a good many developed countries: New Zealand has fostered a network of Maori universities and programs. The country has a varied and stunning landscape that could turn a lot of academic couch potatoes into outdoors buffs. But how long New Zealand universities can survive on what they label as a starvation diet remains to be seen.