This article is more than 2 years old

Universities’ role in economic recovery

For James Coe, as the sector contemplates returning to business as usual it must also consider our responsibilities to the recovery of the wider economy.
This article is more than 2 years old

James Coe is Associate Editor for research and innovation at Wonkhe, and a partner at Counterculture

It is difficult to appreciate the impact of huge social upheaval while you are living through it. As the daily tragedy of the Covid-19 pandemic absorbs our national attention an economic catastrophe lurks around the corner.

As the economic impacts of Covid-19 become more apparent attention has already begun to turn to how we might recover from its effects. But the sector also has responsibilities in the recovery of the wider economy. The Resolution Foundation highlights that universal credit claimant numbers have increased dramatically, those in work are increasingly having their hours cut, there is a rapid contraction of GDP underway, and sectors with the lowest pay will bear the brunt of any future downturn.

Beyond the immediate impact there will be foundational changes to our economy. Almost a million small businesses are at risk of going bust, government borrowing could rise to levels well above the financial crisis peak, and anticipated problems with the graduate employment market could have significant impacts on social mobility.

Following UUK’s call for measures to stabilise the sector it is important to ask not only how universities themselves can recover, but how they can support wider recovery.

The Challenge

The almost inevitable and ongoing economic downturn will be caused by the restriction of movement and its knock-on impact to business. Or as Policy Exchange put it:

In the present circumstances, the principal purpose of public policy is to slow economic activity in order to reduce social contact as part of the public health agenda of reducing morbidity and mortality from the virus. The economic challenge is to find policies to encourage people to stay at home, and to encourage employers to discourage their employees from going to their places of work for as long as necessary.”

This is a useful frame in which to think of universities. The challenge before us is to consider how our practices can not only stimulate local economic activity but to reconnect people after, in some cases, a prolonged period of social isolation.

The People

In Liverpool, we believe students contribute £342m to the regional economy which – in turn – has supported over 3,000 jobs. To put this into perspective, our share of the Liverpool City Region’s GDP stands at over 2.2 per cent. At a government level, as calls grow for further direct fiscal interventions, now could be the time for a temporary increase in student maintenance funding. This would help ease part of the concerns of a drop off in home student numbers, and provide a stimulus to local economies.

Locally, universities will be acutely aware of the need for hardship funding as student loans catch up with a rapid change in circumstances. As bursaries are often based on last year’s income institutions will be forced to plan for both a sudden change in student circumstances, and potentially reconsider how they may support students to study during an economic recession. This might mean building flexibility into the system but should also include consideration of how funding can be targeted toward those most likely to drop out. It will require careful assessment of not only the amounts of funding deployed but the ways in which it is deployed whether that is grants, materials, or access to facilities.

As well having uneven personal impacts, any financial downturn will not be spread evenly by region. As we’ve all seen on twitter there is now daily reporting of which companies have done well by their staff, customers, and communities. As with after the last financial crash, we may well see a focus on local suppliers and supply chains, both as symbolic gestures of solidarity but also, as a tangible measure to support recovery. Only recently, Homebaked, a local bakery based in Anfield, talk about how this may force a revaluation of community endeavour. Universities, as huge purchasers, may take time to reflect where we buy and our criteria for doing so.


The value of translational research has never been more important. The ability of the sector to redirect its resources, collaborate, and work at pace, has been facilitated by an open approach to sharing expertise, materials, and data, toward a greater good. This way of working has been vital in times of crises but it also speaks to our shared capacity for change and for collaboration.

As discussions of an MIT of the North have ebbed we may consider in its place a new digital infrastructure which we can harness. The digital infrastructure for research collaborations could be radically enhanced to encourage virtual working, data sharing, and better integration of systems. Cross sector partnerships will be integral in driving new innovations, and stimulating future economic activity.

Equally, the move to online teaching not only asks us pedagogic questions but of ownership of materials. UUK’s suggestion of providing the full economic cost of research is right in terms of university support but, equally, we will be forced to ask how we commercialise knowledge which supports economic growth, sector stability, and equality of outcomes, in an HE environment where information has been increasingly open.

Creative Engagement

Finally, universities provide important infrastructure in the places they are based. Commercially, they attract businesses and events, but they also contribute to the cultural heritage of a place. Beyond economic harm one of the greatest long-term consequences of Covid-19 will be the impact on our shared cultural lives as we build new habits, discover new technologies, and begin to meet each other again.

Universities have undergone an online transformation of their own and this should extend to their cultural offerings. The drive to offer virtual open days could be replicated to make our artefacts, folios, and treasures, equally accessible to the public.

Once we meet again this crisis will force questions on the nature of the university estate and who it is for. Many institutions undertake admirable initiatives to bring groups on to campus for lectures, performances, and outreach activity. These efforts will be important as people reconnect with our institutions but it will also be for our institutions to reconnect with our cities. This will mean delivering resources in communities, thinking of facilities beyond the campus, and collaborating with those groups we’ve always meant to get in touch with.

As we continue to grapple with the rapidly changing picture on our news screen, attention will soon look toward how we’re going to rebuild after the crisis. As we engage with our town, cities, regions, LEPS, chambers of commerce, MPs, and others, the task in front of us is not only how we rebuild now, but enhance our position as economic drivers and local champions.

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