Opinion: Universities are the make or break of local economies - here's why

In the wake of another university campus closure, concerns are mounting over the impacts on economically challenged towns. Professor Ian Dunn, Provost of Coventry University Group, says universities must be empowered to continue driving education, skills and social mobility across the country:

If the UK higher education sector wasn’t already in dark days, they’re about to get even darker, now that another university has announced it will be closing a campus in a seaside town. With international student recruitment squeezed, costs rising and new levies being introduced, change is an unavoidable necessity.

For a country known for its gold standard of education, the closure of the University of Essex’s Southend campus has sparked alarm about the futures of young people, training and employment and the health of the town’s economy. This will not have been an easy decision for colleagues at Essex. They expanded into Southend with the best of intentions and we should have no doubt that the desire to use education to drive growth and prosperity has not gone away. Alas, the money does not always flow in the same direction as civic and societal impact but someone has to foot the bill.

We know this will not worry some but, amid all the chatter about the Higher Education financial crisis, the claim that there are “too many universities in the UK” becomes crass and nonsensical in the face of the consequences when a university withdraws its presence and provision.

How universities benefit towns and what happens when they disappear

Every person who lives in a town or city with a university will know the benefits of having one nearby. The economic impacts are enormous, with our own report showing that one in every 20 jobs in Coventry can be traced back to the education, research and innovation we deliver, generating £320 million locally and more than three times that across the country.

It is certainly arguable that towns benefit more from universities than cities do, as cities tend to have diversified economies and larger labour markets, whereas many towns have been hard-hit by decades of underinvestment and dwindling high streets and stamped with the rather perturbing label of being “left behind.”

When a university sets up in a town, it acts as a dynamo for the local economy. Jobs increase, businesses move in, residents gain access to education without having to leave home and confidence in the area grows. But pull the university out and the cycle flips. Jobs vanish, supply chains falter, talent pipelines shrink and the town struggles. Its reputation as a place of opportunity fades, discouraging investment and stalling regeneration. What starts as a campus closure can rapidly ripple through every part of the town.

Though once hailed as a “symbol of possibility” within a “left behind seaside resort", the closure of the Southend campus is already magnifying the very real barriers for students in economically challenged areas. Many are saying they will struggle with alternative ways to study - finding other campuses too far away, travel costs unaffordable or balancing long-distance travel with other responsibilities impossible. Some are even considering dropping out entirely. This is not just a colossal loss for the students themselves; it is a loss for social mobility in underprivileged areas and evidence of what happens when background is allowed to dictate talent and potential.

From gaps to growth in Scarborough

We have seen firsthand what a town looks like without higher education and how fast things can change when it arrives. More than ten years ago, we moved into Scarborough after another institution withdrew. The lack of local higher education provision was creating serious consequences for the NHS and health and care sector, which were struggling to recruit and retain staff. The year after opening, we reintroduced nursing training through a BSc in Adult Nursing for the first time in 23 years.

Our campus continues to provide a range of skills and training while helping Scarborough as a place where people can live, learn, belong and progress. To stimulate belonging, our researchers partnered with Scarborough Museum and Galleries to create the ‘Scarborough Atlas’, a digital archive where residents can explore and contribute to the town’s history and stories. Nursing students and staff joined frontline NHS teams at Scarborough Hospital during the COVID-19 pandemic, while in 2023 every nursing graduate secured local employment within twelve months. By 2024, 87% of third-year students had jobs lined up before finishing their degrees. Our presence means Scarborough is a place where talent can be nurtured and retained.

We’ve also taken into account that students in economically challenged areas often require greater flexibility in their studies, particularly those in subjects such as nursing who are more likely to have caring responsibilities, by teaching one module at a time over six weeks, offering six start dates throughout the year and allowing students to complete a set number of modules in stages rather than all at once. It is a model that works so well for students that we are rolling it out across all our campuses and courses.

Universities are the engines of growth that the UK cannot afford to lose

The bottom line is that universities must be seen for what they are: engines of growth in a country where thriving local economies are essentially the jigsaw pieces that form a robust and healthy economy. Any suggestion that there are “too many universities” is preposterous, as campus closures should serve as the starkest of warnings of what happens when higher education is removed from a town – and sadly, for some, it is already too late.

Rather than forcing universities into a position where they must withdraw, the government should be encouraging them to expand into towns in need of a boost and reward them for huge benefits they deliver, especially in an economic climate so dire. Now and never should there have been the time for new levies, restrictions on international students or higher tuition fees. The time must come when universities are empowered to do what they need to keep creating jobs, training talent and sustaining local economies. The future of the country depends on it.