Leveraginghighered

ByPeteDalyonApril30,2012
TheMichiganTurnaroundPlan,aspresentedbythestatewidegroupBusinessLeadersforMichigan,includes highereducationasoneofitskeybuildingblocksthefocusofaMay7BLMleadershipsummitinLansing calledGrowingaHigherEducationMarketplace. OnewayhighereducationcanhelpMichiganbuildastrongneweconomyisbyattractingandproducingthe talentMichiganneedstobecompetitive. "Michiganisgoingtoexperienceatalentshortageofover1millioncollegeeducatedworkersoverthenext10 to15years,"saidDougRothwell,president/CEOofBusinessLeadersforMichigan."Attractingmoreoutof statestudentstoattendMichiganuniversities,solongasthereisnolossofaccessforinstatestudents, benefitsourstateintwoways:TheywillhelpuscreatemorejobsinMichiganbecausetheycanhelpusfilljobs wecan'tbyrelyingonMichigantalentalone,andtheywillbringhundredsofmillionsofdollarsintoourstate eachyear"inpayingforaneducationinMichigan. JimHackett,president/CEOofSteelcase,willbefacilitatingoneofthepaneldiscussions,"HigherEducation TheTalentEngine."HenotesthatthenewpushtorecruitmoreoutofstatestudentstoMichiganuniversities "comesfromtheeffectofthestatefunding(forhighereducation)declining." AgraduateoftheUniversityofMichigan,HackettnotedthatstateappropriationstoUM"havebeenreduced dramaticallyfrom10yearsago"andheaddedthatallofthestate'shighereducationinstitutionsareinthe sameboat. HackettsaidtheonlywayMichigancollegesanduniversitiescanprotectresidentstudentsfrom"super inflatedtuitionistobalanceitwithoutofstatetuition." "Fortheuniversitiestoperformattheirhighestlevelpossible,theyaregoingtoneedthis(increased)ratioof outofstatestudentsinorderforthattohappen,"headded. Inotherstates,henoted,suchasNorthCarolinaandGeorgia,"there'samuchhigherratioofsupportbythe state"forhighereducation. HackettagreesthatthestateofMichigansufferedmightilyintherecessionandthatitisunderstandablewhy allsectorsofgovernmentareunderpressure.But,hesaid,"wecan'tbecuttingourfuture"becauseofshort termbudgetrealities,andheaddedthatthehighereducationcuttingwasgoingonlongbeforethefinancial crisishitMichigan'sstategovernment. Hackettsaidit"frustratesmedeeplythatthelegislatureislosingtrack"ofwhatittakestocompeteinthenew knowledgebasedindustriesandthereasonsuniversitiesneedtobesupported. "Ifyouareproducingknowledgeworkersforthefutureindustries,youhaveashotatcompeting,"hesaid.

Panelistson"HigherEducationTheTalentEngine"willbeDewayneMatthews,vicepresidentofpolicyand strategyattheLuminaFoundation;GeorgeRoss,presidentofCentralMichiganUniversity;andTimothy Nelson,presidentofNorthwesternMichiganCollege. Thehighereducationsummitmeeting,whichwillrunallafternoonattheLansingCenter,willbekickedoffby J.PatrickDoyle,president/CEOofDomino'sPizza.Doyle,whohasanMBAfromtheUniversityofChicagoand anundergraduatedegreeineconomicsfromMichigan,willfocusonwhyhighereducationissuchapowerful potentialgrowthengineforthenewMichigan.BeforejoiningDomino'sinthelate1990s,Doylewasavice presidentandgeneralmanageratGerberProductsCo.'sU.S.babyfoodbusiness. Alongwithbeingatalentengine,higheredisalsoaninnovationengine.AccordingtoBLM,theresearch conductedatAmerica'suniversitieshasproducedsomeofthegreatestinnovationsoverthelast50years, includingcomputers,theInternetandMP3players.Thesecondpanel,facilitatedbyMarySueColeman, presidentoftheUniversityofMichigan,willexploretheleadingroleMichigan'suniversitiesplayindriving innovationthatiscriticaltoeconomicrecoveryandlongtermprosperity.PanelistsincludeAndrDua,senior partnerandcoleader,educationpracticeinNorthAmerica,McKinsey&Co.;HunterRawlings,president, AssociationofAmericanUniversities;andWilliamWeideman,executivevicepresidentandCFO,DowChemical Co. Thefinalpanelofthedaywillbefilledbythreenoteworthyrepresentativesofhighered:WilliamGoetz, chancelloroftheNorthDakotaUniversitySystem;ThomasRoss,presidentoftheUniversityofNorthCarolina System,andThomasHaas,presidentofGrandValleyStateUniversity. AccordingtotheBLM,Michigan'suniversitiesmakeasignificantcontributiontothestate'seconomy,witha correlationbetweeneducationalattainmentandpersonalincomegrowththatiswelldocumented.Yet Michiganhasdramaticallycutitsannualinvestmentinthehigheredassetoverthepastdecade,andpublic attitudesaboutthevalueofhighereducationremainmixed.Thispanelwillexplorethestrategiesemployedin twostatesNorthCarolinaandNorthDakotatoincreasehighereducation'seconomicimpactinthose statesandwhatMichiganneedstodotogrowtheeconomicimpactofitsuniversities. WithsupportfromtheBLMstaff,McKinsey&Co.producedareportinDecemberentitled"GrowingtheNew MichiganHigherEducationMarketplace."ItconcludesthatMichigancanleverageitscompetitiveresearch universitiestodevelopahighereducationmarketplace,becausethestate'sresearchuniversitiesarealready recognizednationallyandinternationallyintheireducationalexcellenceandresearchcapabilities. ThereportnotesthatthestatesoutperformingMichiganinprojectedGDPgrowthinhighereducationfrom 2010to2020includeNevadaat9.25percentandNorthCarolinaat2.64percent.Thelowestinthetop10 statesinthiscategoryisSouthCarolinaat1.59percent.Michigan'sprojectedGDPgrowthinhigheredisa paltry0.43percent,accordingtoMcKinsey&Co. McKinseyoutlinesfouropportunitiesinwhichMichigancangrowuniversityenrollmentandexpanditshigher educationmarketplace:

Becomealeaderinscienceandtechnologyeducation; Attractandretainthebestoutofstateandinternationalstudents; Bethepreferredresearchpartnerforfederalinstitutions; Drivecommercialimpactofinnovation.

AccordingtoMcKinsey,lessthan7.7percentoffreshmenatMichigan'shigheredinstitutionscomefromout ofstate,comparedtothenationalaverageof20.1percent.Atleastsixstateshaveapercentageratehigher than40NorthDakota'sis44.7. "Outofstateandespeciallyforeignenrollmentisagrowingeconomicopportunity"forMichigan,accordingto thereport. AccordingtoRothwell,BLMisdeterminedtopersuadethestategovernmenttoensurethatMichigan'shigher educationsystemisabletorankinthetop10amongallthestates.Akeysteptowardthatgoal,hesaid,isto restorethe$1billioninfundingthatwaswhittledawayfromthehigheredbudgetinMichiganoverthefirst decadeofthenewmillennium. Rothwellsaidhighereducationcanbeaneconomicengineinandofitselfifweincreaseouroutofstate enrollment. "Weareunderenrolledinouroutofstatestudents,"hesaid,addingthatanadditional$2millionintuition revenueflowingintoMichigancollegesanduniversitieseachyearfromoutofstatewouldincreasethestate's GDPby2to4percent. OvertheyearssincetheMichiganeconomybegantostallafter2000,Michiganhighereducationfacedbudget cutafterbudgetcut,andabsorbedthosecuts.Now,saidRothwell,tuitionisrisingtocoversomeofthatlost statefunding,withtheresultthat"it'sthemiddleclasskidsseeingtheirdebtload(foraneducation) skyrocket,"andtheuniversitiescan'tdoanythingaboutit. HacketttoldtheBusinessJournalthathewouldnotleaveK12educationoutoftheequation. TheBLM,hesaid,isalsoconcernedaboutthelossoftraditionalfactoryjobstootherpartsoftheworldwhere laborcostsarelower.K12educationnowmustensurethateveryoneisaswellpreparedaspossibleforhigher education. "Theobligationwehaveistolookattryingtoemploythosefolksinevermoredemandingjobs,intermsof learnedcapabilities.Thesimplefactis,if(afactoryjob)doesn'trequireanykindofspecialskill,thenthe competitionforthat"willbebasedsolelyonthelowestcostoflaborandsomeotherpartoftheworldwill getthework. "Sowewanttocommittothatworkforcethatwecanhelpthemcontinue,asayoungster,togetbetterK12 educations,iftheyarenotgoingtogointocreativeclassjobs,"hesaid,becausethefactoryjobsthatdo remainintheU.S.arepredictedtoentailincreasinglymoreengineeringandprecisiontechnologythatrequires math,scienceandreading.