With the Q3 GDP rate falling and even businesses calling for budget measures to increase jobs and look for ways to make the middle class confident and spend again, one crucial area missed most economist’s radar — education. Or rather, the impact of dropping consumption on the nation’s higher education pursuits.
“The declining middle class is a major issue from the standpoint of higher education since it has an immediate effect on families' capacity to finance higher education and their access to high-quality education,” Vivek Kumar Gupta, professor at Sharda University told THE WEEK. “A greater percentage of the population is experiencing financial strains that make it more challenging for them to pay for the expenses of higher education while the middle class keeps shrinking. In addition to limiting prospects for personal growth, this poses a risk of sustaining intergenerational cycles of inequality.”
While the general tendency has been to view the slowdown in consumption through the prism of economic growth, these angles make it clear how it can have very real problems for the future. When incomes stagnate, as is believed to be the trend post Covid and the K-shaped trajectory the economy has taken, middle-class and lower middle-class families find it tougher to demarcate money for schooling.
This is especially the case with food inflation, the price of essential items, that has been on the boil in recent months. In such scenarios, scrimping on money meant for education becomes the casualty.
“Many students who would otherwise benefit from higher education are unable to attend quality universities due to the financial burden on middle-class households,” added Gupta. “Income inequality is also being exacerbated by the widening gap between the upper- and lower-middle-income groups. Access to social mobility through education is progressively curtailed as the wealth gap grows, which restricts prospects for upward mobility and exacerbates societal divisions.”
The union budget in July had allocated 1.48 lakh crore rupees for education, employment and skilling. It also had some unique provisions like a scheme for internship at major corporations for fresh graduates, as well as schemes for skilling, and upskilling. It also had provisions for R&D labs in universities, and a thrust on private sector participation.
However, with the massive turmoil being caused by AI, many experts have called for a more radical approach to education and research, and a more dynamic approach to skilling to deal with the fast-changing scenario.
Gupta listed out the needs of the hour. “The current per-student spending in India is significantly lower than that of China. Enhanced financial support for institutions is crucial to provide quality education and foster innovation. Expanding scholarships and creating targeted programs for underrepresented groups will ensure equitable access to higher education,” he said, adding, “Investments in research infrastructure, faculty development, and industry-academia collaboration are vital to compete on a global scale.”
Last but not least, he said bridging inequality is paramount to achieving educational excellence in the future. “Bridging the digital divide through rural broadband expansion and building new campuses in underserved regions are critical to increasing enrollment and improving the quality of education,” he signed off.
