Public University an Anchor for Economic Development and an Educated, Engaged Citizenry

Numerous researchers have pointed to the benefits of a strong public university system. First and foremost, we often think of the individual benefits of providing an affordable education to the state’s citizens so that more can join the middle class. North Carolina took this role so seriously for its public university system that the idea of an education that is “free as far as practicable” is inscribed in the state constitution. But there are other broader benefits of a public university system that are equally important: universities serve as a hub for research & development that can spark private sector innovation and improve the quality of life for millions, they also support community economic development by serving as an anchor around which private and public investments can take hold and revitalization can be planned.

Some have said that the successive cuts to the UNC system have had no measurable impact on the quality of its education or its ability to serve these additional goals of supporting local economies. The reality, however, is that the state’s investment continues to remain far below pre-recession levels by 9.4 percent. Since the recession ended, lawmakers have ordered the Board of Governor to cut $1.1 billion through management flexibility, nearly equivalent to the operating state budget of the entire community college system. And North Carolina is one of just four states that made additional cuts to higher education this year, while other states began to reverse cuts made during and after the recession. The reductions to the UNC system have had an immediate harmful impact and will hamper the state’s future economic potential.

Here are three reasons why continued cuts to the UNC system will harm us all.

1.  Fewer students can afford a UNC education. North Carolina’s workforce will increasingly need to have post-secondary education to compete for the jobs of the future and increasingly post-secondary education is the only pathway to middle-class security. The cuts to the UNC system have meant the costs to students and their families for securing a place on that path to the middle class are higher. State cuts to the UNC System have been accompanied by a nearly 40 percent increase in tuition and mandatory fees when adjusted for inflation from 2008 to 2014. The cost of a UNC system education on average represents roughly a quarter of the household budget for a low-income family, a formidable barrier to attendance and completion. A more educated citizenry is the strongest predictor of economic well-being and a contributor to economic growth overall.
2. Research is hamstrung and findings are not broadly shared. In combination with the decline in federal funding as a result of sequestration, cuts to the core operating budgets of UNC campuses have reduced funding for research and development as well as the potential for researchers to share their findings broadly through conferences and trainings. This reduction has the immediate impact of limiting hiring for research projects and reducing contracts with private sector companies. In the long-term, it can also mean forgone developments in fields like medicine, engineering and improvements to our understanding of how societies can work best to support not only a strong economy but a strong democracy. And ultimately, without the ability to share research findings broadly, the research findings today can’t inform the next wave of questions to improve our understanding. One bright spot in the budget is a modest $3 million for “game-changing research” to support investments in faculty, research and product development in areas such as advanced manufacturing and marine and coastal sciences. While this is certainly an important recognition of the role that UNC plays in research and development in the state, it is unclear whether this investment, alongside cuts in other areas, can truly support meaningful research and product development.

3. Faculty is leaving for positions at other institutions. While much maligned by legislators, it is clear that the key asset of the university system is its faculty. These leaders in their fields provide the knowledge and training to students, build the reputation of the system as a whole and conduct the research that makes significant contributions to their disciplines. And yet, faculty has been hit hard by budget cuts. They are being asked to teach more students with less equipment and support from assistants, they have fewer opportunities to attend conferences and exchange ideas with their peers, and they have not received a significant pay increase since the start of the recovery. Of the more than 300 faculty who received offers from other institutions, UNC was only able to keep 25 percent. The result is not only the loss of talent but oftentimes research dollars. Moreover, the UNC system estimates that the cost of the hiring process alone for each non-medical faculty member is more than $900,000. Without faculty to teach and research, the UNC system will be hard pressed to maintain its reputation as an institution delivering a world-class education and contributing to the global marketplace of ideas.

The final budget fails, once again, to rebuild a stronger UNC system. Students, their families and faculty will feel the brunt of the impacts in higher costs, larger class size and fewer dollars and less time for research. But it is also clear that the UNC system will play a diminishing role in its capacity to support economic development as cuts continue. For that, we will all suffer.

This is the fourth post in a series that takes a detailed look at the final budget passed by North Carolina lawmakers during the 2014 legislative session. The first post provided an overview and examined how North Carolina’s investments post-recession have not bounced back nearly as much when compared to previous recessions. The second post explored the inadequate early childhood education budget. The third post shows how the budget spends more of the state’s limited resources on programs rooted in ineffective job creation strategies. See the rest of the series here.