Education — July 30, 2016 at 6:30 pm

BREXIT and Stern: Two Nails in the Coffin of British Academe

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The last few months have clearly been trying on the nerves and confidence of many British academics.  The vote for Brexit, and the divide it revealed between younger and more well-educated voters and those older and less well-educated, has reverberated through the ivory towers and off the red-brick walls of nearly all universities.  Added to this is the recently released Stern Review and its proposed changes to the REF assessment process.  While the Stern Review is, overall, well considered and mostly tweaks to system that UK academics both live by and revile, taken in the combination with Brexit, it will, in my estimation, imply that the UK will increasingly be financially uncompetitive globally and an ever more unattractive destination for academics in many fields.  What I will attempt to do in this article is focus on the combination of these two factors from my perspective as a migrant into the UK academic scene.

The impact of Brexit on British universities has been subject to considerable debate both privately and publicly.  Most considered observers argue that there will be less EU research funding, fewer EU students at all levels, less cooperation between UK and EU institutions and increased costs in recruiting and retaining both staff and students.  No one quite knows what the direct costs to individuals might be, but if my experience with immigration is anything to go by, these costs will amount to several thousand Pounds per person unless the government sees fit to grant resident visas for free to all EU nationals currently in the country.  For those, seeking to enter after Brexit the costs will be very material for those on lower incomes, especially if they have a family.   Within my own university there are already examples of individuals being asked to step aside from EU research grant proposal teams – due to fear of bias from reviewers rather than any retribution from the EU itself, which is on record as saying it will consider all proposals as in the past – and scholars offered jobs who have turned them down because of uncertainty about immigration issues.  In one case, the individual had accepted a position before the vote, only to change their mind after the vote.

However, the indirect impact of the Brexit vote on exchange rates is probably one of the least discussed areas.  It is well known that UK academic salaries in most disciplines are significantly below those paid in North America, Australia and places in Asia such as Hong Kong and Singapore.  In my field, Business and Management, the UK rack rate discount (i.e., the standard salary scale) is about 50 percent at the lower end of scale – lecturers in management, strategy or human resources – to about 75 percent at the upper end of the scale – professors in finance and accounting. With the fall in the exchange rate of approximately 14 percent against the Australian dollar and US dollar, these discounts are even larger.  One of my US colleagues used to call the UK system the “Walmart of academia”; after Brexit it is more like Poundland.  What has held the system in the UK in place (at least at business schools) is that while UK institutions were uncompetitive against the major institutions in places like the US, they were competitive with many institutions in Europe, particularly schools in the East and South of the continent.  In my own school about half the faculty are foreign, with Greeks being the dominant EU source for scholars in the business school; in my specific department – arguably the best in the world in its field of endeavour – 90% of the staff were born outside the UK, with staff from Greece, Ireland, China, India, Poland, Finland, Italy and Romania.  My point is that a system already barely financially competitive at the margin against the best in the world has still been able to play in the global game as long as it has because of its openness to foreign labour.  While we still desire to be open to all, the cost of that openness may soon be prohibitively high.

The Stern Review of the REF can now be added into this discussion.  While most of the proposals make by Lord Stern are variations on current practice, one in particular is germane to the point I am making: Proposal 3 – Outputs should not be portable.  The proposal is basically aimed at aligning the assessment of research output to that of research quality.  The last REF exercise did not allow ‘impact’ case studies to be submitted unless they were based on work done at the institution for which they were submitted.  In addition, there was a view expressed that “[t]here is a problem in the current REF system associated with the demonstrable increase in the number of individuals being recruited from other institutions shortly before the census date. This has costs for the UK HEI system in terms of recruitment and retention. An institution might invest very significantly in the recruitment, start up and future career of a faculty member, only to see the transfer market prior to REF drastically reduce the returns to that investment. This is a distortion to investment incentives in the direction of short-termism and can encourage rent-seeking by individuals and put pressure on budgets.”  What Stern proposes is to replace rent-seeking by individuals with rent-seeking by institutions, effectively shackling academics to their current employer and encouraging individuals who have effective scholarly records to capitalise on those records overseas rather than in the UK.

I will admit, in the spirit of open disclosure, that I was a REFugee, recruited into what the University of Leeds called a University Leadership Chair.  I arrived right before the REF census date.  However, according the logic of Stern, I was engaging in blatant rent seeking.  Nothing could be further from the truth.  In actuality I took a slight pay cut to move to the UK (which is now a much larger pay cut given Brexit) and the only reason I moved was that Leeds was willing to accommodate my ‘rent seeking’ by paying me something closer to my market worth rather than the Walmart-UK discounted salary dictated by the salary scales.  However, I have stayed faithful to the institution for 4 years now and one would assume that the University is satisfied with this arrangement (as well as the dozen or so others who joined under the same scheme).  However, the reality is that without Leeds accommodating that ‘rent seeking’, I would never have even considered moving (indeed, in the past I did not even bother talking to UK institutions because the arrangements they could offer were generally substandard).

Stern’s logic on portability is flawed on a number of dimensions, two of which I will emphasize.  The first is that it is the institution making the investment.  Institutions do not do research, individuals do research.  While there is co-investment, this investment can vary massively from faculty-to-faculty and individual-to-individual.  In the physical sciences there can be huge fixed investments on the part of the institution, while in business and other social sciences that investment may be trivial.  To argue that the individual cannot carry their intellectual capital to another institution is akin to saying that the institution’s claim on the intellectual property (from a REF perspective) is 100 percent no matter what their material investment may have been.  The second flaw is related to timing.  In some fields it is easy for individuals to generate publication outputs.  While in others the process can be quite slow and the number of publications expected from the best scholars can be quite small.  In my field, the time between submission of a manuscript and its ultimate publication ranges from 3-5 years, with a typical paper having to go through 3 rounds of reviews.  Hence, given the natural review processes an individual will basically be stuck at their institution for a period of indenture that can amount to 5 years or more.  No school will hire them away since they lack REF value (indeed, given Stern’s proposal that all staff be assessable, newcomers may impose a real burden on staff already at the institution).

So what does this imply?  Brexit requires that foreign academics thinking of coming or staying in the UK rethink their position in light of real material decreases in their financial position, as well as potentially increased costs of being an immigrant.  Add to this the fact that the Stern Review proposals imply that if an individual chooses to move to or stay in the UK they are effectively indentured to their institution and you have very strong incentives for scholars to rethink the UK as possessing an environment where they can most effectively build and enhance their intellectual and professional capital while ensuring that they are paid consistent with the value of human capital.

 

 

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