Irish universities contribute €8.9bn to the economy but is this under threat from a decade of underfunding?
Irish universities have become the lifeblood of the country by fuelling our cultural and social development, feeding the workforce with skilled workers and boosting the exchequer by €8.9bn a year.
We’re living in a digital age where it is vital that our educational institutions provide a talent pipeline for the knowledge economy if we want to stay competitive as a nation. However, it can be easy to underestimate the invaluable economic, cultural and social benefits that the seven Irish universities provide to the state.
Our universities contributed a massive €8.9bn to the economy in 2017/2018, according to a new report by economic consultants, Indecon. That included a €1.5bn boost from research and innovation alone.
Not to mention the fact that Irish universities support a total of 21,801 full-time equivalents, making them a huge employer in their own right. Plus the estimated total annual export income for the Irish economy from international students studying in Ireland was an impressive €386m.
However, the Indecon report took a new and impartial look at the net impact that universities have on the national economy and on the social and cultural fabric of the nation. It revealed some surprising details about how far-reaching the economic and social benefits are to both individuals and the state.
An island of scholars
Third level education is now within reach for more Irish people than ever before. More than half of Irish students leaving school can now expect to pursue third level education, which is testament to how far we have come as a nation.
The report from Indecon shows that Ireland is the most highly-educated member state within the European Union, with 46pc of 25 to 64-year-olds holding a third level qualification. The EU average is just 31pc.
Having a highly skilled and educated workforce has solidified Ireland’s reputation as a great place to do business but it also helps to foster and grow employment within the value-added sectors of the economy. Some sectors of the Irish economy now have 65pc graduate employment.
This has a clear economic benefit to individuals and the state. It generates employment and boosts local industry while supporting higher income levels and better living standards for graduates.
Individuals who qualify with an undergraduate degree enjoy a €106,000 net gain in lifetime earnings. This rises to €146,000 for master’s degree holders and €222,000 for those with a PhD. A highly educated populace obviously enjoys the financial and social benefits on a personal level but this also translates into an increased tax income for the economy.
The report predicted that there will be a net lifetime gain of €1,606m to the economy from the student cohort that entered university in 2017-2018 alone.
It also investigated social and community engagement by Irish universities, their staff and their students. More than two million visitors attended events or attractions hosted in or organised by Irish universities, showing the important role they play for tourists and oversees visitors.
Universities are part of the social and cultural fabric of the communities in which they are located, contributing to everything from sport and culture to entertainment and the arts. Universities are the breeding ground for the people who drive our cultural and social development, in many cases.
The report found that a majority of people in arts-related occupations have a degree or higher, including over 80pc of authors, writers and translators.
Three quarters of university graduates surveyed by the report believe that universities have a very positive/positive impact on facilitating social mobility, developing cultural activities and providing skills for creative activities.
Universities also foster social engagement, with 17,500 university students from the 2017-2018 academic year engaged in a variety of volunteering activities. That represents three million volunteer hours being freely given to communities, with an estimated value of €28.4m.
Could these benefits to Irish society be under threat?
There has been a 50pc increase in university enrolments since the year 2000, and it continues to grow, but there has not been a corresponding growth in investment from the government. A total of 78,000 students enrolled in university in 2000 but this number grew to 120,000 in 2017.
“Ireland cannot continue, as we have been, increasing student numbers without a commensurate increase in investment,” claimed an Independent Expert Panel appointed by the Department of Education and Skills on ‘The Review of the Allocation Model for Funding Higher Education Institutions.’
The Irish Universities Association (IUA) has warned that the lack of funding could not only threaten the gains that we have made as a society but could also result in a shortfall in places for future students. That in turn would impact on the ability of employers to find skilled, trained workers to continue driving our economy forward.
The gains that have been driven by Irish universities may be impressive, but they are by no means irreversible.
In 2016, the Cassells report recommended that the government find extra funding of up to €600m annually by 2021, rising to €1bn by 2030. This recommendation has not been implemented, leading to the formation of the IUA’s Save Our Spark campaign.
The campaign is looking to highlight what is now recognised as a “funding crisis” and it is asking the public to put pressure on their local government representatives to pursue sustainable funding options for Irish universities.
Jim Miley, Director General of the IUA, adds that a lack of investment could result in dropping standards or less opportunities for students.
“If the higher education crisis is not addressed by Government urgently, then we risk a serious drop in quality or a shortfall in places for students in the future,” says Mr Miley.
“For the first time ever, all seven Irish universities along with business, trade and student unions are coming together to demand urgent action on the funding crisis, as we need substantial investment to accommodate the extra students that are expected to enter the system over the next decade.
“The Government simply can’t continue to ignore this crisis. It’s time to take action now and we’re encouraging students, their parents and everyone with an interest in the future of the country to visit the Save Our Spark website and contact public representatives about the issue.”
You can download the full or summary version of the Indecon Independent Assessment of the Social and Economic Impact of Irish Universities on the Save Our Spark website.