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Higher education not enough for economic development

Policies on the accessibility of skills and knowledge, the location of industry and networks of local companies could boost the impact of higher education on economic development, says a report published last month in the International Journal of Educational Development.

The study emphasises a renewed focus on the developmental role of universities to inform global debates around innovation and local economic development.

Recognition of the global knowledge economy has seen higher education enrolment figures going up in the global South – but the absence of external support for higher education has affected research capacity for development in Africa, says the study.

The research, funded by the South African Department of Higher Education and Training or DHET, was led by Dr Glenda Kruss and involved researchers at the Human Sciences Research Council, or HSRC, of South Africa.

South Africa has seen major growth in high skills occupations, but this has been countered by growing unemployment, poverty and inequality, according to the report.

Since 1994, a deliberate set of science and technology policy instruments has promoted the development of a national system of innovation, prioritising big science, technology transfer and the growth of niche competences and capabilities.

The DHET, which was formed in 2009, has promoted the creation of a single post-school education and training sector, with a stronger message about employability and responsiveness than in the past.

Higher education interaction with industry in the forms of collaborative research and development and innovation has been incentivised by the Department of Science and Technology.

The study said that the national system of innovation remains characterised by “islands of innovation”, of cutting-edge activity at the technology frontier in selected niche areas while firms in most sectors struggle to raise their levels of productivity and technological capabilities to compete more.

Sectorial skills

National innovation systems are said to encourage higher education’s developmental role by emphasising the significance of education, skills, work and production for economic development.

To demonstrate this, the researchers looked at case study sectors in South Africa on three levels – primary (sugarcane farming), secondary (automotive) and tertiary (astronomy) – for factors that affect education in each case. The final report excludes the primary sector on the sugar and milling industry: it is less concerned with higher education.

Background research was conducted on value chains, employment patterns and policy frameworks associated with each sector. The actors involved were interviewed to find out more about the skills and strategies needed in each sector.

On astronomy – particularly the huge, international Square Kilometre Array, or SKA – the country was found to have geographic advantage to host radio astronomy telescopes, and the project is strongly linked to global innovation networks.

Highly coordinated skills development efforts that were rolled out from an early stage of the SKA bid process have helped it to flourish. Industry, government, universities, research institutions and funding agencies meet regularly to take stock of the project.

The automotive sector was found to be strongly controlled by global production chains, with research and innovation conducted primarily at multinational headquarters. One industry was found to be located in one of the poorest provinces in South Africa, the Eastern Cape, with high levels of unemployment, poor infrastructure and low levels of educational achievement.

While the Department of Trade and Industry has been successful in setting incentives that have kept the sector alive, it does not provide a model for productive transformation. It fails to include specific mechanisms to promote skills development.

The study concludes that the automotive sector’s interactions with higher education appear fragmented and limited as it fails to fully embrace technological upgrading to strongly link with global production chains and innovation networks.

Multiple processes need to occur during knowledge production, according to the study, and to make technological and industrial progress, developing countries cannot simply import technologies without investing in the technological effort to master, acquire, adapt and improve upon existing technologies.

“Science and technology links and knowledge exchange with universities, research organisations and other organisations are critical for technological capability building, but equally so are linkages to those organisations or actors that build the skills required at all occupational levels of the firm,” the report said.

Key messages

“We need to be less focused on a blanket assumption that higher education simply and unproblematically is a sound investment for participation in a global knowledge economy and more aware about sectoral and national opportunities and constraints,” said study lead author Professor Simon McGrath, of the school of education at the University of Nottingham, UK.

McGrath told University World News that theoretically, the main message is about focusing less on human capital in general and more about how innovation takes place in firms, networks and economies, and how higher education contributes to this.

“This leads to a policy message that higher education can make a difference to economic development but that this difference can be maximised when there is a clear focus on the specifics of sectors and professions that could absorb graduates and which could be engines of development through innovation.”

McGrath said this implies more closely aligned higher education and trade and industry policies, with a strong sectoral and regional focus.

“It suggests that neither the market nor the state is the sole answer for economic developments; rather, both are important but so are networks – and these can be usefully supported through facilitating intermediary organisations. For us, the management, policy and academic messages of the study all intertwine,” he added.

Dr Rushil Ranchod, labour market intelligence partnership research communications manager at the HSRC, said there has been a relatively simplistic link in discussions between education – the development of human capital – and how that leads to economic development.

“What our research shows is the extremely complex sets of interactions between education and training and the economy, and how these interactions may work (or not) in improving economies at the local and sectoral level,” he told University World News.

Ranchod said that at the policy and practical level, this work was increasingly on the South African government’s agenda.

This month in parliament, Deputy President Cyril Ramaphosa was asked questions about the relationships between technical and vocational education and training colleges and industry, particularly around issues of the quality of training and access to jobs.

“This work forms part of that broader process and shows how critical it is for universities (and colleges, as our work also shows) to develop the capabilities to interact with a range of different partners.”

Ranchod said the study could assist government decision-makers to recognise the importance of building networks and linkages between education and training providers and the private sector. To generate the right types of skills, a sector needs to become more competitive.

“This research shows it is important for academic institutions to build internal capability to interact and engage in networks and systems around skills development, rather than a more centralised skills planning system,” he continued.

“For universities, it shows how they can better engage with different actors, across government and the economy, to allow for better alignment of their respective interests.”
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