College Education in a Globalizing Environment: A Guide for Students

by Raj Aggarwal, Dean, CBA, University of Akron

Introduction

Driven by the fundamental forces of technology and economics, globalization has been the major trend for the last few decades and is likely to continue for the foreseeable future expanding its reach and influence. Regardless of our feelings on globalization, we must deal with it. While globalization creates many new jobs and attractive choices for consumers, it also creates some challenges with an increasingly wider range of jobs in the United States and other rich countries are being outsourced to people in poorer countries. In such an environment where many specific US jobs may disappear, what should US college students focus on learning? This essay contends that flexibility and learning how to learn along with a good work ethic, leadership skills, and career flexibility are likely to become more important for long-run success.

Economics of technology and globalization

In understanding the modern role of college education, we must examine the relationship between technology and globalization, two major trends in modern times. First, technology makes globalization easier and more possible. For example, there have been great advances in the technologies of communication, making it easier and cheaper to communicate internationally. We can use e-mail (free), watch TV feed instantly from overseas events (free), make international phone calls (almost free), and even travel overseas (getting ever cheaper in inflation adjusted terms). Information, market knowledge, and money are now transmitted across the globe instantly and freely at almost no cost. Because of advances in materials and engines, transportation costs for goods and people also keep declining. At the same time, goods are becoming lighter and their value to weight ratio is rising making more sense to transport them internationally. As one manifestation of this, it has been some time since most of us last buy an item of consumer electronics made in the US.  So, besides information and money, goods and people are also being transported internationally at ever lower costs. Technology does indeed facilitate globalization by making it easier and cheaper!

Second, globalization, in turn, increases the value of technology. Most people who travel internationally have noticed an interesting phenomenon. People seem to listen to very similar music in many if not all countries, especially as exemplified by teenage music. This phenomenon is not limited to music, people now seem to dress similarly and increasingly buy similar goods and services (for example, note the global success of the Sony Walkman and now the Apple iPod). Globalization is increasingly integrating markets and tastes across the globe. This process increases the size of the markets for any new technology or product so that globalization increases the value of new technology by increasing its potential market.

As this brief discussion indicates, technology makes globalization easier and more possible, i.e., technology facilitates globalization. But at the same time, globalization makes technology more valuable. So, here is the circular and mutually reinforcing nature of the relationship between technology and globalization: Technology leads to more globalization and globalization makes technology more valuable and that leads to further advances in technology; ……..which leads to more globalization and that leads to more technology……., and so on, in ever expanding mutually reinforcing cycles!!

Thus, we are most likely to see ever increasing globalization. The trend toward increasing globalization is not only powered by its mutually reinforcing relationship with technology, it is also supported by economic principles that show globalization creates new wealth. Globalization allows countries to trade and so specialize and focus on what they do best and most efficiently. This process of specialization powered by international trade and investment creates new wealth. This new wealth shows up not only as higher average income levels, albeit with a different distribution among socio-economic groups, but also as vast increases in the range and quality of available consumer goods. We increasingly buy Chinese made electronics, Korean made cars, Indian textiles and steel, and get computer help from somebody in India (most likely from Bangalore). The proportion of our consumption that originates overseas continues to increase.

Another related phenomenon accompanying globalization is the re-shaping of the global economy. For example, China and India (Chindia) are rising fast as new and large centers of economic growth – they are both highly populous countries growing at nearly double digit annual percentage rates in contrast to the growth rates of traditional large global economies that average 2-3 percent for the US and 1-2 percent for Western Europe and Japan. Chindia was at least half of the world economy in the 1700s, and with the recent re-rise of Chindia, we are seeing a re-orientation of the global economy (pun intended). The growth in Chindia is augmented by growth rates of 4-6 percent in the rest of Asia and other emerging economies like Brazil, Russia, Poland, and many other formerly socialist countries. The shape of the world economy is being transformed profoundly and very rapidly.

The rise of globalization sometimes evokes strong feelings. However, regardless of our position on whether it is good or not, we must prepare to deal with the impact of globalization as it is unlikely to go away. Of particular relevance here and as indicated above, globalization re-distributes wealth and jobs – the topic of the next section.

Changing nature of work

According to Moore’s Law, that has now held for over a quarter century, computing power continues to double in power and decline to half the cost every 18 months. These continuing advances in the power and affordability of computing power have brought us enormous changes – changes in both work and leisure. Our music and video entertainment is increasingly delivered digitally; and with special effects! Most modern work is done on computers and can be done from anywhere. The sight of people working on their laptops in coffee shops has become fairly common. Indeed, people are working in airports and on airplanes, in car repair and doctor’s waiting rooms, and almost everywhere not just including waiting places, but also on beaches and other places and times usually associated with leisure. Indeed, when we travel domestically or internationally, it is usually not a problem signing on to the internet and taking care of work back at the home country office. This phenomenon illustrates just one power of the technology of the internet.

So, most modern work is done on computers and can be done from anywhere, even from an overseas location. Indeed, it is a relatively minor next step to imagine that some routine type of work can be done as well by residents of foreign countries! Thus, the movement to outsource many jobs from the rich countries to low wage foreign countries. One impact of the outsourcing movement is that the nature of work in the rich countries is likely to keep changing. The rich countries will focus on the higher value added components of most jobs, with the lower value added components going overseas. For example, while routine low value added jobs such as call centers, data entry, and low level programming are being outsourced from the US, we are getting more high value added components from overseas, such as drawing up legal contracts and preparing industrial designs as indicated by the positive US balance of trade in service jobs. While people in routine low-value added jobs in the US face possible job losses, those in high value added service jobs face increased demand and higher salaries. As a result, the range of salaries in every profession and between professions continues to widen.

The changing nature of work has many implications. For example, most modern work in this information age is not as easily observable as it was in the industrial age; so with few exceptions, the modern focus of supervision is on results and decreasingly on being at a given physical place such as an office for a given time period. As another implication of work being done increasingly away from a given physical location, hierarchical management processes, especially in the US and other developed countries, will have to evolve too to reflect the changed nature of modern work.

Education for an uncertain future

So, given this increasing globalization and changing nature of work, what is my advice to US college students? What should they focus on while in college? It seems that college students need to think about their needs in both short-term and long-term perspectives. They should focus on acquiring a good mix of theory and practice. The theory is very important to understand and adapt to changes in the work environment – to understand and anticipate what will be high value added activities and what activities will be low value-added. A good theoretical framework will help you with a long-term perspective. However, you cannot ignore the short-term – we all live in it!  Put another way (by the economist, Keynes) “in the long run, we are all dead”. You need skills and knowledge that will get you a job to start with – so it is important to learn some practical skills as well. The practical skills will help you get a job and the knowledge of theory will help you keep working even in a changing environment.

But, many people are forecasting that we are likely to change careers frequently. In a changing work environment brought on by globalization and technology, there are other skill sets that can also be important. For example, given the rise of Chindia, it may be useful to learn Mandarin and Hindi and how to work with people from that region and from other “foreign” countries.  More generally, skills and experiences useful in working effectively with people from other countries are going to become increasingly important. While people are basically similar across countries, they express these basic values, desires, and traits very differently depending on their culture. So in this age of globalization, the skills, experiences, and languages useful in working across cultures and nationalities are becoming increasingly important.

In addition, as I explain in “Welcoming the Future: A Guide for the Intrepid Traveler” Vital Speeches of the Day, November 1, 1995, pp. 62-64, it is also important to enjoy what you do (for one thing, it is the only way you will really be good at it), acquire analytical and problem solving skills, develop the ability to be a self-motivator and be well-organized, practice leadership skills, learn to deal with ethical issues and to be an honest and good person in the workplace, and be prepared to take some risks and go out on a limb occasionally for your beliefs. Most importantly, you must continually develop time and task management skills that allow you to balance the merely urgent with the really important aspects of your job. You will also have to develop skills that are necessary to balance the ongoing needs of your personal and family life, work requirements, and continuing education. One way to prepare for the acquisition of these skills is to get involved in lots of activities, including activities with student organizations, while you are a student in college.

Of course, it always helps to be lucky, but how do you increase your odds of being lucky? Having a good work ethic and being prepared for change is one way to do it – after all luck is just hard work and preparation meeting a chance opportunity. While in the short-run, you need specific job skills, in the long-run, flexibility and learning how to learn, and the qualities and attitudes described here are going to be more important

Conclusions

The mutually reinforcing fundamental forces of technology and economics are driving increasing levels of globalization. Consequently, whether we like it or not, globalization is here to stay; and most likely will even expand its reach and influence. While globalization creates many new jobs and wider and more attractive consumer choices, an expanding range of low value-added jobs in the United States and other rich countries are likely to be outsourced to people in poorer countries. This essay asks the question, “In such an environment where many specific jobs in the US may disappear, what should US college students focus on learning”? This short essay contends that, in the long run, a good theoretical framework and learning how to learn along with a good work ethic, flexibility, ability to work in different cultures, and leadership skills are likely to become more important than the short-run advantages clearly conferred by specific and detailed knowledge of a given field. A good college education should and must balance both these short- and long-run needs to be considered useful and successful.