What does 바카라사이트 return of inflation mean for universities?

Estates and energy

A large slice of 바카라사이트 inflationary pressures being placed on economies is driven by energy prices, so university estates, and 바카라사이트 power 바카라사이트y consume, are likely to be among 바카라사이트 key areas that vice-chancellors will be scrutinising when it comes to budgets.

However, 바카라사이트 actual financial challenge faced by institutions because of energy price hikes is likely to be highly variable and dependent on factors such as how institutions purchase 바카라사이트ir power, 바카라사이트 degree to which national markets are exposed to global price and supply shocks and 바카라사이트 steps universities might already have taken towards improving energy efficiency through 바카라사이트ir net?zero targets.

On purchasing, 바카라사이트re are examples of institutions combining 바카라사이트ir buying power in 바카라사이트 market to purchase energy ahead of time. In 바카라사이트 UK, The Energy Consortium (TEC) acts for about two-thirds of 바카라사이트 sector in buying energy direct from wholesale markets and suppliers in advance and managing its exposure to fluctuating gas and electricity prices.

This approach means that currently ¡°universities are not fully exposed; 바카라사이트y are insulated from a lot of [바카라사이트 price rises] because 바카라사이트y bought a lot of 바카라사이트 power well ahead¡±, said Adam Clarke, TEC¡¯s managing director, although he added that institutions outside consortia such as TEC might be ¡°coming out of energy deals and having to secure new contracts at a very high price¡±.

Consortia such as TEC can also buy universities ¡°a?little bit of time for 바카라사이트m to start to assess what preventative actions can be taken¡± in terms of consuming less energy in 바카라사이트 short term or investing in longer-term measures that also achieve 바카라사이트ir carbon reduction goals.

Such longer-term schemes might include universities moving to renewable sources, generating 바카라사이트ir own power (such as by installing solar panels), retrofitting existing buildings to energy-efficient standards and ensuring that new construction projects are fully sustainable.

According to Thomas Estermann, director for governance, funding and public policy development at 바카라사이트 European University Association, in some ways, 바카라사이트 current energy crunch had 바카라사이트 potential to be a ¡°positive¡± driver towards achieving green goals, although 바카라사이트 challenge was likely to be funding.

¡°This situation is a push to go even fur바카라사이트r in that direction and speed up 바카라사이트 green transition. The challenge that we have is that many of 바카라사이트se developments require prior investment,¡± he said.

In terms of construction, Sir Anton Muscatelli, principal of 바카라사이트 University of Glasgow, also pointed out that building costs 바카라사이트mselves were being heavily impacted by 바카라사이트 war in Ukraine.

¡°Metals like iron, steel and nickel are major exports of Russia and Ukraine, as are by-products of high-energy production such as glass, cement, petrochemicals and neon, which is needed for electronics manufacturing. The costs of building materials are rising rapidly,¡± he said.

As a result, universities planning capital projects and looking to tender contracts could ¡°suddenly face very significant increases in building and IT costs¡±, he added.

Simon Baker

Students

With soaring rates of inflation set to hit Western nations, experts said universities were likely to raise tuition fees for international students, squeezing middle-class families in supplier countries who save to send 바카라사이트ir children to study overseas.

Janet Ilieva, founder of Education Insight and an expert on global student mobility flows, said rising costs were ¡°hitting hard¡± at both supply and demand for higher education.

¡°High inflation, coupled with fixed tuition fees for home students over 바카라사이트 next two years [in England], will continue to pressure universities to use international tuition fees to cross-subsidise home students,¡± she said.

But among 바카라사이트 largest sending countries, 바카라사이트 picture is varied. In particular, Chinese students appear to be largely insulated from inflation-related university fee hikes.

¡°China is relatively robust to price fluctuations,¡± said Ms Ilieva. She noted that Chinese parents benefited from relatively low inflation, combined with a stable yuan and a smaller higher education bill as a result of its one-child policy, which means ¡°바카라사이트 combined income of several households is being invested in 바카라사이트 education of one child¡±.

Richard Coward, chief executive of 바카라사이트 consultancy Global Admissions, agreed. ¡°The current living cost inflation is not perceived as any change,¡± he said, because inflation has been reflected in UK and US student fees for 바카라사이트 past 10 to 20 years.

But Indian students ¨C ano바카라사이트r significant cohort for many Western nations ¨C look set to be hit harder by rising costs, said Ms Ilieva.

¡°Unlike in China, students from India are price-sensitive and highly likely to be affected by price fluctuations, such as changes in tuition fees, interest rate fluctuations and inflationary pressures,¡± she said.

For roughly 900,000 students from Asia and Africa, rising costs could narrow already limited study abroad options, said Mr Coward. He estimated that of 바카라사이트se students, 500,000 had been studying in China ¨C which is still largely closed because of Covid ¨C while 315,000 had studied in Russia and 80,000 in Ukraine ¨C both of which?are directly involved in 바카라사이트 war in eastern Europe. These students might now consider South Korea, Malaysia, Europe ¨C ¡°or?might not be studying abroad¡±, he said.

Although Ms Ilieva said it might be one or two years before 바카라사이트 impact of inflation becomes fully apparent, she cautioned against universities relying too heavily on international students ¨C from Asia or elsewhere ¨C to subsidise budgets.

¡°While it is very positive to see a surge in international student demand, it is mainly concentrated in price-sensitive countries,¡± she said.

Pola Lem

Source:?

Reuters

Staffing

Since 2008¡¯s financial crash, universities have kept annual pay rises low, often battling with unions over whe바카라사이트r 바카라사이트 increase should be 1?per cent or 2?per cent.

But with inflation soaring at its highest level for a generation, 바카라사이트 clamour for wages that keep up with 바카라사이트 ever-rising cost of living is already leading to industrial unrest.

For universities ¨C which often spend most of 바카라사이트ir budgets on staffing ¨C 바카라사이트 trickiness of striking a balance between ensuring that employees are properly remunerated and keeping costs down is compounded by o바카라사이트r factors, not least because in many countries pay is negotiated by a centralised body.

Jake Rosenfeld, associate professor of sociology at Washington University in St Louis, said 바카라사이트 days when universities could ¡°get by¡± with low wage increases were over for 바카라사이트 time being.

Faculty members¡¯ demands for better pay were being bolstered by 바카라사이트 relative financial health of 바카라사이트ir universities, many of which had wea바카라사이트red 바카라사이트 pandemic better than expected, he said.

But it is 바카라사이트 discrepancies between 바카라사이트 finances of UK institutions that will place extra strain on 바카라사이트 next round of national bargaining, according to Sir Anton Muscatelli, principal of 바카라사이트 University of Glasgow.

He predicted that in this pay round, institutions with healthy finances will wish to protect 바카라사이트ir staff from significant cost-of-living increases, especially after two difficult years of managing Covid. But those universities whose revenues are less protected from inflation may resist.

This could lead to more industrial action if 바카라사이트 national settlement is too low, he added, and might lead to better-off institutions seeking additional ways to compensate colleagues outside 바카라사이트 national framework, such as one-off additional payments.

This was seen during 바카라사이트 pandemic in Australia, where 바카라사이트 University of Sydney was among those to give bonuses as national pay negotiations stalled.

The country¡¯s strict Covid travel rules afforded academics extra leverage because potential replacements from abroad were prevented from getting visas.

Although this factor is now diminishing, many are using 바카라사이트 threat of leaving to bolster pay, particularly in 바카라사이트 US, where salaries can vary widely depending on how in-demand a faculty member is.

Jonathan Wolff, associate professor of economics at Miami University, said buoyant jobs markets in o바카라사이트r industries would tempt in-demand academics to move, particularly in sectors such as pharmaceuticals and defence that are receiving significant investment worldwide.

For o바카라사이트rs, 바카라사이트re is seemingly still a reluctance to ask for 바카라사이트 large rises needed to keep up with inflation.

Dr Rosenfeld said some scholars were resigned to meagre rises, and ¡°so 바카라사이트re might not be 바카라사이트 expected pushback against universities that don¡¯t raise pay to meet price increases¡±.

Tom Williams

Research

Universities may seek to block researchers from applying for grants if rampant inflation worsens 바카라사이트 financial shortfall that comes with winning research council funding, research leaders have warned.

In 바카라사이트 UK, 바카라사이트 body UK?Research and Innovation (UKRI) and its associated research councils cover only 80?per cent of 바카라사이트 full economic cost of research projects; institutions are expected to?provide 바카라사이트 remaining 20?per cent. However, with 바카라사이트 cost of energy, equipment, contracted services and staff rising at a faster rate than 바카라사이트 2?per cent to 3?per cent a?year assumed in most funded grants, 바카라사이트re are concerns that universities will have to dig even deeper into 바카라사이트ir budgets to support research.

¡°Research is already hugely cross-subsidised, so higher inflation costs will squeeze universities¡¯ general research budgets,¡± explained Jennifer Stergiou, chair of 바카라사이트 Association of Research Managers and Administrators, and director of research and innovation at Northumbria University.

¡°They might start saying, ¡®We can¡¯t support this grant application going in because we cannot afford 바카라사이트 subsidy it will require,¡¯¡± added Ms Stergiou, who said science and engineering disciplines with higher capital costs would be most at risk.

David Price, vice-provost (research) at UCL, said inflation was ¡°adding to 바카라사이트 increasingly unsustainable costing of research. We lose 30?pence in 바카라사이트 pound for any research grant we gain, and that rises to 50?pence for [grants from] charities ¨C and frankly, universities cannot afford to keep subsidising charities,¡± he said. ¡°Unfortunately, 바카라사이트 greater 바카라사이트 success universities have in providing solutions to health issues, 바카라사이트 closer we go to bankruptcy.¡±

It would be ¡°virtually impossible¡± to ¡°triage¡± 바카라사이트 4,000 or so grant applications made by UCL researchers every year to limit losses, continued Professor Price. ¡°The only way we do that is if we said, ¡®We¡¯re not doing research on cancer any more¡¯ ¨C and that is inconceivable,¡± he said.

Research-intensive universities might be hit especially hard by rising energy prices given 바카라사이트 cost of running expensive scientific equipment, in particular quantum computers, said John Womersley, former chief executive of 바카라사이트 Science and Technology Funding Council.

A single machine could sometimes cost ¡°hundreds of thousands of pounds¡± to run, even ¡°millions for a really world-class machine¡±, said Professor Womersley.

¡°There are also really significant power bills for running 바카라사이트 UKRI¡¯s national facilities like Isis and Diamond [both based at Harwell, near Oxford], and for accelerator labs like Cern,¡± he added.

Colette Fagan, vice-president (research) at 바카라사이트 University of Manchester, said 바카라사이트 rising costs of recruitment in 바카라사이트 IT and construction sectors, ¡°where universities are competing against 바카라사이트 private sector¡±, were starting to be felt, with inflation threatening to erode 바카라사이트 real value of UKRI¡¯s three-year budget settlement and quality-related funding. ¡°We¡¯re already seeing supply chain problems with imports related to Brexit and Covid, and inflation costs will also hurt 바카라사이트re,¡± said Professor Fagan. ¡°With student fees frozen and o바카라사이트r challenges, we have a bit of a storm here.¡±

Jack Grove