The last two articles in the Innovating Ireland series have been on development hubs for flying things and building things. This week we return to some first principles for the economy and discuss education. Sadly, there is no way of dressing this up: our education system does not represent the modern world and seems decades away from doing so. 

The 20-year target this week is for us to have the world’s best education system for life-long learning. Believe me, this is a Herculean task and arguably our greatest challenge as an economy. Thankfully, it comes with the greatest upside if we succeed. 

Why invest in education?

To quickly re-cap why it is worth investing, there is arguably no better Government investment than education. Improving average education levels through well-applied spending has been seen to drive GDP throughout the modern age. 

Association between test scores and long-run economic growth after controlling for baseline GDP and years of schooling (Hanushek and Woessmann, 2010)

Not only this, addiction, teenage pregnancies, large family sizes, child deaths, violence, corruption and anti-democratic practices are all seen to decrease when average education rises. This is to the point that in almost any problem zone globally, you will find low average education levels. 

I also emphasize the word “average” – elite education for a small volume of the population does not work as effectively as a high national average. In this regard, trickle-down education is about as effective as trickle-down economics. 

The impacts of education provision are so profound that of everything I write in the Innovating Ireland series, if I could do just two things, they would be increasing education spending as a per cent of GDP while also improving the quality of education provided. (Those readers who have seen or heard of the Koh Samui Cup may appreciate the two do not necessarily go hand in hand!) 

Unfortunately, as you can see from the expenditure chart below, our government is currently doing the opposite. More cost-effective methods of teaching and managing administrative load are being ignored, while many policy papers are written about what we might do to modernise education. In fact, all the tools we need are here today and we need to transition to them rapidly, as they will improve our education quality while also making it cheaper to educate. 

One of the reasons governments are slow to focus on education development, in spite of the obvious upside, is that it takes a generation to change. This is tough when you are in a four-year decision cycle, where it is easier to make people happy by lowering taxes regardless of the long-term consequences. 

Focussing on education means you may not see an impact for ten or 15 years. If our new, modern education system appears tomorrow and a five-year-old enters it, the economy will not benefit from these digitally turbo-charged citizens until they hit their twenties and their real impact will only come to bear another 20 years from there.

The government is consistently trying to increase university fees without addressing the bloated administrative divisions that provide no education services, but approach 50 per cent of total higher-level education spend, according to a 2017 Higher Education Authority paper. Asking students to pay more money while little effort is being made to improve the allocation of capital or its efficiency seems remarkably one-eyed.

As we continue to insist students use books and utilise paper record-keeping, it is very difficult for education systems to benefit from the cost-improvements provided by dematerialisation. Why the Department of Education has not mandated that schools must transition to paperless institutions beggars belief. It is easier, cheaper and reflects the modern world. 

In addition to the cost savings on assets, there are also significant operational gains as we have seen with the transformation of private industry over the last 20 years. Books, note-keeping, paper-records…Little or no aspects of these things exist in the real world the students are moving into, so why are they in our schools? There are so many straightforward ways for us to go paperless. Admin should all be computerised with modern software as per the private industry. 

All courses should adopt ebooks and teachers may use modern project management and productivity tools to deliver education, assign homework, record attendance and so forth. Pretty much every step in the direction of paperless education will better prepare the student for the modern world, while reducing cost and reducing workload for the teacher and support staff. 

Instead, the working groups who have systematically failed to address our long-term national deficit in maths skills are now being asked to address our lack of digital skills. Einstein’s quote on the nature of doing the same thing over and over again and expecting a different result springs to mind. We still have unusually low math scores, below the OECD average, so the long-term initiative to address the issue seems to have mostly been a failure thus far. 

How can this process deliver us a new digital curriculum, given mathematics underpin most emerging technology solutions? We haven’t begun to teach coding below the age of 18, so how do we anticipate teaching AI or data science practices below the age of 18? How will we teach hardware automation? Since 2000, we have shown that we are almost incapable of adapting our education system to the modern world, so it seems we again require legislative bravery and new thinking to get us there. 

To inform the size of the opportunity, Bloomberg recently highlighted the AI expert shortfall. They estimate that there are 22,000 PhD researchers working on AI problems, with 3,000 actively seeking work. Imagine if we adapted our education. 

Today Ireland produces over 1,000 new chartered accountants per year. We have over 360,000 on the island today according to Chartered Accountants Ireland. Even in the early 2000s, figures like that would have been faintly ridiculous and evidence of failure to prepare for the future (and this is before adding solicitor and banker figures). 

Imagine if we produced 500 AI PhDs per year? This would mean we are providing roughly 17 per cent of AI researchers seeking work annually. What if we produced 500 data scientists per year as well? What of hardware automation engineering? If our education system was preparing our graduates for the future, we would be doing this today. 

€50 billion over 20 years

Those that are paying attention would not find it hyperbolic to describe this as a crisis, yet it’s not really in the national discourse. Most people know we are rubbish at maths and our universities are falling down global rankings rapidly, but the real story is how quickly things are going to get much worse due to failure to prepare for the new skills our industries will need. We need to act now before the decline in our competitiveness becomes terminal. No one is really talking about this. 

To say we cannot afford the massive expenditure required for the overhaul is actually not true. The CSO reported that between 2012 and 2016, we spent €2.5 billion on fossil fuel subsidies per year. I would propose that as a matter of urgency this is ceased immediately and re-routed to education, increasing the education budget by approx 25 per cent and providing an extra €50 billion over 20 years.

This increased budget, allied to the efficiency provided by moving away from paper and using tools that provide the benefits of dematerialisation, will give us a lot of assets to correct the problem. We will need every cent. 

I will return on Monday to detail what we need – and can do – with this better allocation of resources.