Marketisation of Education in the Globalised Economy

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The two main ideas of this paper are, firstly, that the material, economic circumstances push the education systems in advanced capitalist countries towards marketisation; and secondly that we should understand this concept of marketisation in a broad sense: marketisation means not only privatisation, transforming education into a new market; it means also adapting narrowly education to the present, very specific, demands of labour markets; and it means using education systems as an instrument to stimulate some markets, especially the ICT-markets. The paper is essentially based on the study of national reform programs in European countries and on reports published by international organizations like OECD, World Bank and the European Commission.

This paper was presented at the
Worldwide Forum for Comparative Education, “Globalisation of Education : Government, Market and Society”, Beijing Normal University, August 2005 and at the European Conference for Educational Research, Dublin,, September 2005.

Main evolutions in the education systems

When we look at the evolution of compulsory education in industrialised capitalist countries, especially in Europe, we notice several important common trends.

The first, and in my opinion the most obvious of these trends, is decentralisation and deregulation. The former centralised education systems, run by state, are transformed into networks of flexible, competitive schools, often managed by local authorities or non-governmental groups. There is given more local power for developing own programs, own teaching methods. In a report published eight years ago, the European research institute on education, Euridice, noticed already that “ the reforms in European education systems can be summarized as a progressive movement towards decentralization and reducing the central power of the state” (Eurydice, 1997).

This evolution is strongly supported by industrial lobbies, like the European Round Table: “We must encourage manners of training that are less institutional, more informal (…) As industrialists we believe that educators themselves should be free to conduct the same kind of internal searches for efficiency without interference or undue pressures exerted from the outside” (ERT, 1995).

But, as we will notice in some of the next points, this decentralisation and deregulation in the field of management, goes often together with a stronger central state-control on certain specific achievements and on the definition of the objectives of education (skills, work-related learning, preparation for life-long learning).

Secondly, the very fast growth of educational expenses that characterised the fifties, the sixties and the seventies has been dramatically slowed down in the 80’ and the 90’. In the European Union, the public expenditures for education stagnate since more than ten years around 5% of the GDP (with the notable exception of Scandinavian countries whose expenses remain at a high level, about 7% of GDP) (Eurydice, 2005). In some countries, like Belgium for instance, relative expenses have even been severely reduced while the number of students in higher education continued to grow.

Thirdly, when we look at the school-programs, at the objectives of education, we see that the emphasis is now not more on knowledge or “general culture”, but more and more on skills destined to prepare for “life-long learning” : professional skills (mastering a second language, or ICT-related skills) and vague transversal skills (like problem solving) or so-called “social skills” (like adaptability). (OCDE, 1994; CEC, 1995; ERT, 1995; CEC, 1996; Reiffers, 1996; ERT, 1997; OECD, 2001)

The fourth common trend we observe since about 15 years is a growing social inequality in school. National as well as international studies show that the educational gap between higher-class and lower-class children is widening again in many countries (Thélot and Vallet, 2000; Albouy and Wanecq, 2003; GERESE, 2003; Nicaise et al., 2003). The process of generalising comprehensive education that marked the 60’s and the 70’s has been stopped. We notice a return to a stronger and a sooner selection, which turns often into a social selection. The aim to democratise the access to general higher secondary education has often been abandoned for a so-called “second chance” education, which usually means a work-oriented vocational training.

And precisely, the fifth trend is a growing work-orientation of education. More emphasis is put on vocational training, on work-related teaching, on developing partnerships between schools and private companies, on promoting “entrepreneurship” in education. (CEC, 1995; CEC, 1997; CEC, 2000b; CEC, 2001b; OECD, 2001)

Not only do schools go to business, business comes also into school. We notice a tremendous growth of diverse forms of commercial presence in the schools : putting advertisements on the school-walls or upon teaching-material, sponsoring of activities by private companies (GMV-Conseil, 1998). Or even using education to sustain the market of IC-technologies, as the European Union decided in Lisboa five years ago. (CEC, 1996; CEC, 1997; CEC, 2000a; CEC, 2000b; CEC, 2000c; CEC, 2001a)

And so we come to the last common trend, where we see education becoming itself a new profitable market: private teaching, private schools, private management of schools, on-line learning, in one word: Education business. The American consulting group Eduventures writes that “the 1990’s will be remembered as a time when the for-profit education industry came of age. The foundations for a vibrant 21st century education industry – entrepreneurship, technology innovations and market opportunities – began to coalesce and achieve critical mass” (Newman, 2000) Following the analyses of Merril Lynch “the situation is ripe for a vast for-profit privatisation of education”. Although this statement could seem somewhat exaggerated in respect of most European countries, where this extreme form of marketisation relates at this moment almost only to higher education and long-life learning, we notice that in other parts of the world the evolution towards privatisation goes much faster (Johnstone, 1998; IFC, 1999; Patrinos, 1999; World Bank, 1999; Robertson et al., 2001). This is especially the case in Far-East and South-East Asia. In South Corea, the private expenses for education have recently surpassed the public expenses (Bray, 2004).

Economic globalisation

The above sketched evolutions coincide with the process of economic globalisation and the emergence of the so-called “knowledge society”. It seems thus likely — and following a Marxist framework for analysis it seems even obvious — that the developments in the field of education should be linked with the evolution of the economic environment. To develop this point, we have to characterise some aspects and contradictions of economic globalisation. (For a more in-depth analysis, see (Hirtt, 2004))

Since the middle of the eighties, the economy of advanced capitalist countries faces two major challenges.
Firstly, we have an exacerbation of economic competition, which resulted initially from the economic crisis in the late 70’s. This means great instability, high unemployment rates, heavy pressure on public expenditures and a continuous pursuit of competitiveness.
Secondly, industry and services have been entering the era of new technologies, especially information and communication technologies.
These technologies lead to new forms of labor-organisation, with more flexibility, just-in-time production and a fast internationalization of production and exchanges. But it means also more unpredictability, more instability, more unequal development, which in return feeds the exacerbation of economic competition. (CEC, 1997; Field, 1997)
So, while technological development is stimulated by investors, by companies and by governments as a way of solving the problem of competitiveness at the local or national level, it becomes a key-element in keeping up an exacerbated economic competitive environment at an international level

Now we have the global economy on one side, and a global evolution of education systems on the other side. But how does the first entity produce the second ?

The three axes of school-marketisation

An exacerbated economic competition has one indirect and three direct consequences for the education systems.

Let’s begin with the indirect-one. To improve competitiveness of national or local industries and services, governments are urged to diminish fiscal pressure. “Less taxes”, is one of the main demands of their national companies. And less taxes means less financing of public services, especially one the most costly, education. This is, obviously, the first and main explanation for the relative decline of public educational expenses we noticed above. I call this link “indirect”, because most of the representative organisations of business and capital are not actually demanding to reduce the education-budgets. The European Round Table of industrialists even asked for an increase (ERT, 1989). But at the same time their members ask each national government to reduce taxes. This is a characteristic contradiction between global and individual interests of capitalists. We will see later why, in this case, the individual interest (cutting taxes to improve competitiveness) is the winner of the contradiction.

Now, let us see what are the direct consequences of globalised competition, the three main axes of school-marketisation.

Firstly, the exacerbated economic environment means that investors are constantly looking for new profitable markets. And of course, now that many of the public services in advanced capitalist countries are already privatised, the two billion dollar worldwide education expenses are regarded as a new Eldorado (Patrinos and Ariasingam, 1997; Larsen and Vincent-Lancrin, 2003).

Secondly, it means that companies will try to use the vast commercial opportunities represented by hundreds of millions of students and pupils, by reinforcing their commercial presence in schools. And when it concerns sectors that are considered as strategic by governments, as it is the case for ICT-markets, then we see the European Commission itself plead the cause of using education as a mean of stimulating that market: “It is doubtful if our continent will keep hold of the industrial place which it has achieved in this new market of multimedia if our systems of education and training do not rapidly keep pace. The development of these technologies, in a context of strong international competition, requires that the effects of scale play their full role. If the world of education and training does not use them, the European market will become a mass market too late” (CEC, 1996).

Thirdly, the heavy economic competition means that governments are put under pressure to adapt swiftly and narrowly the contents and structures of education so that they respond better to the changing demand of skilled workforces.

This explains, of course, the trend towards a more work-oriented education. But not only.

As we have seen, globalisation is more than just international competition. It is also a new organization of labour, which means more flexibility and a less predictable environment. Therefore, education is asked to attach less importance to knowledge, which “is nowadays, in our fast-moving societies and economies, a perishable product” (Cresson, 1998), and to put more emphasis on those skills that can guarantee flexibility and adaptability of the workforce. An OECD-report puts that very clearly: “It is more important to aim at educational objectives of a general character than to learn things which are too specific. In the world of work, there exists a set of basic competences – relationship qualities, linguistic aptitudes, creativity, the capacity to work in a team and to solve problems, a good understanding of new technologies – which have today become essential to possess to be able to obtain a job and to adapt rapidly to the evolving demands of working life” (OCDE, 1998). The really important thing, in school, is not more to learn, but to “learn to learn”, to be able to adapt quickly to the fast changing technological environment and to the rapid rotation of labour force in industry and services. “The advocacy for lifelong learning rests on the idea that preparation for active life may not be considered as definitive and that workers must (follow) training during their professional life to remain productive and employable” (OCDE, 1997).

Flexibility and unpredictability mean also that education systems themselves have to develop their capacity of adaptation, by becoming more autonomous, more competitive, less dependent from central regulation. “We must encourage manners of training that are less institutional, more informal”, pointed the European Round Table of industrialist in 1993 (ERT, 1993). Two years later, the European Commission proved to have learned that lesson: “The most decentralised (education) systems are also the most flexible, the quickest to adapt and hence have the greatest propensity to develop new forms of partnership” (CEC, 1995).

Of course, there is a big danger in these last evolutions. Emphasis on work-oriented skills, rather than on general knowledge, less regulatory barriers, and above all budget-cuts in education can lead quickly towards inequality in education. There we find again the contradiction mentioned above : how can education be more effective in producing the workforces needed by the knowledge-society, if it has less financial means and if it evolves towards a social polarisation which will leave a great part of future workers without any high-level qualification ? Some people on the left do even believe that the growing demand for high-skilled workforces will be sufficient to force governments to invest more in education and to push education systems towards social democratization on the long term.

Unfortunately, this is an excessive optimistic idea. Actually, it is a misunderstanding of the concept of “knowledge society” to believe that the future economy will only need high skilled workforces. On the contrary, in all advanced countries where statistics are available, we notice a polarised evolution of labour market. In the US, for instance, when we look at the 30 occupations with the largest job-creation, we see that 22% of them require indeed a very high level of education (a bachelor or doctoral degree), but on the other hand we see that almost 70% of these jobs require only a short-term or a middle-term on-the-job training : cashiers, cleaners, waiters, truck drivers, security guards, home care aides, etc (Braddock, 1999).
The same evolution is noticed in France, where the number of unqualified jobs has grown from 4.3 millions to 5 millions in the last ten years, while it had constantly been reduced during the previous decades (Chardon, 2001).

Polarisation of the education levels needed by the labour market: that is the reality behind the myth of the “knowledge society” in the industrialised countries. And it makes us understand how these societies can manage with social polarisation, with deregulation and with budgetary cuts in their education systems. And why the European Commission can make propositions that would have shocked everybody twenty or thirty years ago : “Education could be rationalised by providing a shorter period of general education which is better tailored to market needs” (CEC, 1993).

There are of course many other interconnections than those presented here. But it would be impossible to develop them in this short presentation. Let me just add two points.

We have to observe that all of the six first trends in education policy contribute to stimulate the last one: privatisation. Less regulation opens the door to private investments in education; the emphasis on skills and labour-oriented teaching and the reluctance of public education systems to adapt to this demand makes private education more attractive; social polarisation and budget cuts in education contribute also to make private education investments profitable.
As the European Commission pointed in the White Paper on Education and Training, “There are many today who think that the time for education outside school has arrived, and that the liberation of the education process which it would make possible will result in the control of education by providers who would be more innovative than the traditional structures” (CEC, 1995).
And finally, we have, among the main forces of economic globalisation, the fast development of Information and Communication technologies. By allowing new forms of distance-education, hence new niches that are not controlled by the state, ICT is another very important catalyst of education-business. “The development of different sources of information and knowledge is going to bring about a rapid decline in the monopoly of educational institutions in the domain of information and knowledge” (CEC, 1997).

Conclusion

The above analysis has shown that the present evolutions of education systems in advanced capitalist countries are not only the result of political choices. The neo-liberal agenda in education is also, and more fundamentally, a product of objective, material, circumstances in capitalist economy. In my opinion, those mutations mark a new identity between school and business, namely: the transition from the historical era of “massification” of education to the era of “marketisation” of education. Unless the emergence of a radical and worldwide movement to stop this development, to defend a public and democratic school for all and, above all, to change the economic (dis)order which is generating that evolution, education will quickly evolve towards a polarised system, where “public authorities will only have to ensure access to education for those who will never constitute a profitable market and whose exclusion from the society will grow while others will continue to progress” (OECD, 1996).

The three main aspects of this marketisation mean that the pupils and the students will be regarded as future adaptable producers for industry and services, flexible consumers on the worldwide market and good clients for the emerging education business. But what about educating critical citizens, armed with the knowledge that will make them capable of understanding the world they live in and capable of participating in the transformation of that world ?

To contact the author : nico.hirtt@ecoledemocratique.org
Website of APED : www.ecoledemocratique.org

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Nico Hirtt est physicien de formation et a fait carrière comme professeur de mathématique et de physique. En 1995, il fut l'un des fondateurs de l'Aped, il a aussi été rédacteur en chef de la revue trimestrielle L'école démocratique. Il est actuellement chargé d'étude pour l'Aped. Il est l'auteur de nombreux articles et ouvrages sur l'école.