Vaccination and tech key to education finances in 2022
If you were listening to Deloitte Access Economics partner Chris Richardson address the 2021 Finance Leaders’ Summit, you would have heard him call this the most uncertain time that any finance leader – including those in the education and VET sector – have ever had to deal with in their careers in Australia.
You would also have heard him say that any forecasts about the fortunes of the Australian economy and other economies around the world were essentially vaccination forecasts, due to the severe impact that lockdowns and other restrictions and impacts have had on the ability of economies and businesses to grow.
“All forecasts, whether it’s wages, jobs or rates of industry growth, are now vaccination forecasts. We said this year would be a tug of war between mutations and vaccinations, and within a handful of months, Delta arrived. What we know is the better the vaccination rate is around the world, the more normal life can be,” he said.
Raising the prospect of potential future virus mutations, particularly from under-vaccinated regions of the world like Africa (which was sitting at just over 10% at the time of the Summit), he said the best investment the world can make in economic prosperity would be in vaccinating the world faster and more comprehensively.
The education impact
Education finance leaders have been in the eye of the storm. While Richardson called those educators who relied on local students a more ‘bankable’ proposition into the future, thanks to rising birth rates in Australia in the first decade of the 2000s, he said those who needed foreign students could expect a bumpy ride for some time to come.
“I expect volatility and the need for agility is going to remain quite an issue for universities. At a point where borders are starting to open and there is the potential for greater good news than expected, it is still going to be challenging, whether that’s Covid related, or because of the changing geopolitics,” he said.
Richardson explained that the Chinese authorities were less keen on supporting Australia as an education destination, even though Chinese people themselves were still positive on accessing Australian education, an attitude that previously propelled international education to become Victoria’s biggest pre-Covid export.
“However universities fight back, they are going to need the ability to do the sort of thing we are doing here [on video conferencing software]. Face-to-face is marvelous but it is going to be under challenge one way or another for a couple of years at least. Having a technology solution is where upside is.”
Success through technology
Where does this leave finance leaders in education?
Eighty-six per cent of senior executive leaders agree the pandemic has forced their organisations to become more open to experimentation and quick shifts in strategy, according to Deloitte and SAP. When asked to nominate key challenges, 32% nominated speed of technological change and 30% named supporting a remote working model.
This has left businesses re-examining their existing processes to identify areas for improvement, starting with small adjustments that could have a large impact across the organisation. Financial leaders are taking a lead in implementing new technologies, with a view to gaining better control over their financial activities.
This includes helping the organisation re-imagine work processes for a decentralised workforce, providing tools to gain visibility into current spending and help forecast future activity more accurately, improve auditing efficieny and tax reporting to uncover savings, and adapt more quickly to things like changing regulation.
The joint Deloitte and SAP research predicted an embrace of cloud-based solutions to answer the need for anywhere access, an uptick in the use of AI and machine learning to improve things like automation and insights for finance teams and others, as well as seeking to maximise value from their existing technology solutions.
Getting better at education?
Richardson said that, although Australia has a 3% smaller population now than it would have if there were no Covid-19 outbreak around the world, its economy was only 2% smaller. The difference has essentially been the rise of technology, and people learning to meet, talk learn and solve problems in all sorts of more productive ways.
Educators are making the same incremental advances. With the prospect of large unforseen hits due to the virus aside, Richardson says that the Australian economy is in a great position to emerge strongly. "You can get lost in international comparisons, but as a nation we've done well through Covid. We should all be proud to be Australian."
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