after decades of building a world-class higher education system,
Michigan has been under-investing in our universities and community
colleges for years. Since 2000 state funding for higher education has
been cut. Policy makers have consistently ranked higher education as a
lower priority than tax cuts, k-12 education, prisons and health care.
If that’s not bad enough, within the higher education budget the trend
has been to fund more generously the non-research universities, rather
than the three major research universities. From an economic
development perspective, this makes no sense.
Its time for a change!
We need civic, business and political leadership (as they are doing in
leading edge communities across the planet) to put research
universities at the center of our economic growth strategy.
There are other more predictable ways research universities boost our economy:
Forget spin-offs, research universities themselves are major job
creators. Higher education is one of the fastest growing areas of
long-term, good-paying employment growth. And within higher education,
research universities are the most important because they are
export-based enterprises. Rather than just selling goods and services
to each other, research universities are growing the wealth of the
state/region by bringing $ from across the country. In total Michigan
universities--mainly the three research universities--bring in more
that $1 billion annually of federal funds and employ thousands of
• Higher education’s importance in preparing talent for a knowledge
economy is clear. But it also is one of--if not the--most important
assets in retaining and attracting talent.
Our universities--particularly the research universities--are among the
few enterprises in the state that attract talent from around the world:
students, faculty and researchers. And they are anchors of the kind of
neighborhoods that young talent wants to live in: mixed use, high
density, walkable, culture and entertainment rich. Those kind of
neighborhoods are essential to keeping recent college grads here rather
than Chicago, Seattle, etc. It's no accident that such neighborhoods
are growing around the University of Michigan and Wayne State.
• Knowledge-based employers are increasingly locating where they find
knowledge workers. And that means around research universities. If you
want to attract world-class enterprises like Toyota, Google and Pfizer,
as Ann Arbor has, it helps a lot to be the home of a world-class
And yet, for some reason, even though in the University of Michigan we
have one of the great research universities in the world and in
Michigan State and Wayne State two others that rank in the top 100
nationally, Michigan policy makers have never viewed major research
universities as a key economic resource. This needs to change!
emphasize enough, in a knowledge economy, the strategic importance of
our major research universities. Communities across the globe,
recognizing the importance of research universities, are trying to
replicate what we already have here.
One can make a strong case
that the most productive state and local economic growth policies over
the past several decades have been public investments in research
universities in Austin, San Diego and North Carolina's Research
Triangle. The payoff in each case has been huge.
Bill Gates in a 2005 presentation to the National Conference of State Legislatures said it best:
take the two big leading industries, industries around biology and
medicine, that's one, and industries around computer technology, that's
two. The job creation and the success for those industries have been
overwhelmingly in the locations where there is a great university.
There's an almost perfect correlation between the number of jobs in a
region and the strength of the universities. And, that will continue,
whether it's new fields like nanotechnology, or those two fields I
mentioned, on the ongoing strength that they'll have. And so for this
country, we have to have the best universities.
wisdom has it that the most important contribution that research
universities make to the economy is by spinning off for
commercialization new knowledge. No question places where new knowledge
is being created have a big edge in being the places where new
technologies are commercialized. But there are no guarantees. It's hard
to turn an idea into a commercial success. And when you do, often there
aren’t many jobs or they go elsewhere.
How to revive our
economy is Topic A. When you look at the places across the country with
the strongest economies the answer is clear: talent!
distinguishes economically successful areas from Michigan is their
concentrations of talent, with talent defined as a combination of
knowledge, creativity and entrepreneurship. Quite simply, in a
knowledge-driven and entrepreneurial economy, the places with the
greatest concentrations of talent win.
If you want to grow a
high prosperity economy here, the priority is to prepare, retain and
attract talent. Nothing else is close.
As we assess the assets
Michigan has to concentrate talent, our higher education system rises
to the top of the list. That is particularly true of our major research
universities. So the most important thing business, civic and political
leadership can do for the future economic success of Michigan and its
regions is to ensure the long-term success of a vibrant and agile
higher education system.