Universities are in a state of flux and they are strategically reweighting their priorities in the current funding environment. This has adversely impacted on the availability economics courses and subjects – the latest cuts at La Trobe are a case in point. We must also acknowledge that in competitive student markets we have not fared well compared to the business, management and marketing disciplines. This mirrors what has happened in the high schools. In 1989, 21,211 candidates undertook the Economics examination in NSW across the three courses in the subject (39% of the total candidature). Economics was the third largest individual subject, after English and Mathematics. By 2013 out of the 75,168 students enrolled in the NSW Higher School Certificate, only 5,335 students studied Economics (63% male, 37% female). Business Studies (a course not available in 1989) had 16,020 candidates (51% male, 49% female) for the 2013 NSW Higher School Certificate, and was ranked the 4th most popular subject by course enrolment.
Reviving economics enrolments at the high school level is likely to be at least one way to make the study of economics more attractive at the tertiary level. But how do we change student preferences? What can be done to make the economics offering more interesting and attractive? What are the factors that weigh on the minds of high school students when making subject choices? University academics have enough trouble trying to understand university students, let alone those in high school. The Australian Curriculum, Assessment and Reporting Authority, however, have brought together both primary and high school teachers and university academics, as well as curriculum and assessment specialists, to produce Foundation to Year 12 Australian Curricula. In the case of business and economics the proposed national curriculum covers year 5 through year 10.
It is to be hoped that the new proposed curriculum will reignite a passion for the study of economics. This Australian Curriculum provides an interrelated and an integrated approach towards the study of economics and business. It develops an understanding of how decisions about the use of resources affect the creation and distribution of wealth and how this is related to the wellbeing of individuals and countries. It provides the skills that allow students to make informed decisions that will enable them to make the most of opportunities meet their goals and secure their financial wellbeing, while also contributing to the prosperity of the Australian economy. The new curriculum makes sense of the world through investigating and developing an understanding of the Australian economy and its interactions and relationships with the global economy, in particular, the Asia region. It allows students to appreciate how the business sector plays an integral part in the economy: it is a driver of innovation, competition and job creation within the economy. Moreover, new technology and globalization opportunities are transforming the business environment. One consequence is that the nature and type of jobs available to young people is changing faster than ever. The proposed curriculum communicates the message that a study of economics and business is vital for development of the skills and knowledge that individuals need to effectively manage their life, learning and work roles in the 21st century.
In Years 9 and 10 there is an opportunity to provide students with a richer and applied context to deepen their understanding of economic and business principles. While the units of work deal with a particular economic or business area, schools will have a choice within them. For example, when looking at markets, schools will be able to choose which particular market they study. For example, purely for illustration purposes, the units of work might include any of the following
Housing and the property sector
For most Australians the main component of their household wealth comes from housing. The supply of housing has barely kept pace with the increase in underlying demand leading to significant increases in house prices. Issues relating to housing – prices, rent levels, home ownership rates and housing affordability, mortgage debt levels and interest rates – are always a source of public discussion and commentary. Students learn about the main players in the property industry – the construction firms, property developers, real estate agents, mortgage providers – and how the nature of work in the sector has changed in the digital age where, for example, Asian buyers can acquire real estate without even physically visiting the property. Financial literacy is applied in developing student’s appreciation of mortgage debt, fixed and variable rates, and by utilising various readily available internet calculators that can easily show how the loan amount affects the repayment requirements and length of the loan at various interest rates. Choices about housing (buying, renting, location) are crucial lifestyle and investment decisions while housing affordability problems and indigenous housing issues concern policy makers. Ultimately, what we do with our land in terms of urban congestion and the spread of cities onto formerly agricultural land to cater to the extra demands for housing from migrants and native-born Australians, will also have environmental implications.
Natural resource management
The rapid expansion of the minerals sector, on the back of strong Chinese demand for resources, is a key factor driving the Australian economy. It has clear implications for disparities in income growth across states and regions, macroeconomic management and the exchange rate, and the shifting demand for work towards the resource-rich regions. Economic management of resource revenues is a challenge but so are sustainability issues relating to the environmental consequences of resource depletion and regeneration. Mineral exploration and extraction often have a direct impact on indigenous communities and so indigenous land rights issues are a further important dimension. Yet the discussion is not limited to minerals but also forestry in Tasmania and elsewhere, water management, land degradation and electricity generation. The demand for, and often the limited and fragile supply of, natural resources is studied and students are made aware of the importance of the concept of discounting future benefits and the role this plays in rates of extraction and environmental conservation, and how taxes can be used to spread the benefits of resource development. The often foreign-owned resource companies are studied along with the skill and capital-intensive nature of the work environment.
The health care business
Australia’s population, like that of most developed countries, is ageing as a result of sustained low fertility and increasing life expectancy (see Australia to 2050: Future Challenges, January 2010 (Intergenerational Report 2010), Attorney-General’s Department). In the past Australia was a relatively youthful country. Over the next 40 years, the proportion of the population over 65 years will almost double to around 25 per cent. At the same time, growth in the population of traditional workforce age is expected to slow to almost zero. This is a demographic challenge for health care in this country. While these overall demographic considerations will drive national outcomes, there will be differences between regions. In addition, the demographic profile of indigenous Australians is strikingly different. More than half of the indigenous population (57 per cent) are under 25 years of age. We will identify the main health care providers and the type of care they provide. Health care service sector employment issues will be discussed in the context of the increasingly technology-based nature of curative care health care providers. Aged care is of particular interest, with its often complicated financial dimension, in the context of the implications of an ageing population on the Australian economy, the sustainable supply of health care and the growing international market for health care services.
The sports industry
It is sometimes said that Australians are obsessed with sport. Although sport provides entertainment and excitement to countless millions of enthusiasts, it is important to remember that behind the scenes, there is an entire industry which is rarely, if ever, seen by sporting fans. Like any other industry, the sport industry needs first class management. Sport managers and administrators are expected to be multi-skilled, bringing to the workplace a strong work ethic, broad business-based knowledge, and a propensity and ability to be proactive and creative. They must possess numerical and technical competence and have the ability to communicate effectively in a variety of media and genres in the areas of event management, sport venue management, and the management of athletes and sporting teams. There are numerous aspects to explore from an economics and business perspective including such topical themes as gender disparities in pay, indigenous participation, exorbitant salaries, corruption and gambling issues, the inflated crowd figures often reported and the net benefits, if any, from major sporting events like the Olympics or World Cup.
Topical issues and questions
- What do we mean by our standard of living, well-being or happiness? How do we measure it and how does it compare with other countries?
- Businesses create value for its customers and generate profits in a competitive environment that spurs innovation and growth of income and production. What are some of the key challenges that confront global business in the twenty-first century? This may involve a study that explores the innovative ways global businesses seek to be competitive particularly in the context of digitisation (products and services becoming electronic); disintermediation (with intermediaries disappearing as customers connect directly with suppliers via the internet); and unbundling (products are increasingly disaggregated into discounted components and sold separately).
- Prosperity in the context of environmental limits and global resource constraints may involve shrinking our environmental footprint through shifting to renewable energy. Financial instability and changing work patterns, including concerns about precarious employment, also affect our well-being. How effectively are we responding to these issues? This may involve evaluating the notion of corporate social responsibility in the context of an increasingly competitive global market, sustainability concerns and heightened community expectations about ethical business behaviour.
This is only a snap-shot of where the new curriculum may lead. Whether this new curriculum will turn the tide in terms of economics enrolment has yet to be seen, as its full implementation may still be some time off. Yet something clearly needs to be done to reverse the current situation with respect to economics study in schools and subsequently universities.
Professor John Lodewijks was a member of the ACARA Economics and Business Curriculum Advisory Group.