Japan's Tertiary Education System: Developments in the Koizumi Era of Reform

With this first JPN HEO blog post of April 2008, I am using this forum to publish an article that was delivered as a paper at the SEAAIR conference in Langkawi, Malaysia, in September 2006. It will serve as something of a retrospective on happenings in higher education during the Koizumi years of 2000-6 and the preceding years that set up the reforms of what now could be called a political era for Japan.

News posts on the demographic crisis and reasons for the failure of English education will follow in the remaining days of April.


Japan's Tertiary Education System: Developments in the Koizumi Era of Reform
Charles Jannuzi

Abstract

This paper will survey the major developments and changes that have taken place during the past decade in Japan's tertiary education system and put them into international (comparative) and historical perspectives. It also will attempt to assess critically the impact of major reforms on the national and public universities (and the response of the more numerous private universities to these reforms as well). For example, as of 1 April 2004, Japan's 87 national universities were 'denationalized' and incorporated into 'autonomous institutions' (or 'juridical persons') giving them, at least in theory, wider discretionary powers over personnel management, teaching and research assignments, program and curriculum development. The new status was supposed to result in more local autonomy within each institution over the allocation of money for their mandated missions in teaching, conveying public services to their regions, and conducting basic and applied research in science and technology. Have such top-down reforms proven effective, and have their effects matched the government's stated intentions? It is the author's contention that, not only are the reforms a classic case of reform over-reach, but that Japan's overbuilt university system will face demographic, financial and socio-cultural crises that the current Koizumi era of reform, now coming to its close, has utterly failed to address.

Introduction

This year, as the Koizumi period of politics comes to its close, pundits are already skeptically evaluating the accomplishments of his administrations. The PM had promised that his reforms would spare no part of the national government and political economy. He even threatened to destroy his own long-ruling party, the LDP, in order to effect the changes.

Much of the electorate, when asked, said they supported the reform agenda of the popular PM, but in the long run they did not really understand his rationales or his priorities. For example, the profitable postal system (which includes huge, world-class savings and insurance divisions) was not in any state of crisis, however much it might have been the envy of struggling banks and insurance companies. It had already accepted and assimilated reforms that improved its business plans and operations. If anything, the financial health of the postal system showed that government-run companies can compete profitably in a capitalist political economy. Yet the full privatization (and eventual public listing) of the postal system dominated debate in last year's election. Meanwhile, the main opposition to postal reform came from within Koizumi's own ruling LDP. More than anything it would seem Koizumi's desire to 'reform' the postal system reflected a personal vendetta he had against the bureaucrats in charge of it.

Ironically, while the PM was often at war with his own party and the bureaucrats of his own government, his divisive leadership ultimately prevailed, delivering--as much by accident as by design--a landslide victory late last year in a lower house election, defeating a united opposition party (the DPJ) that advocated far more liberal, pro-business reforms! On the other hand, Koizumi's inattention to any sort of foreign policy independent of the US and his open displays of conservative nationalism and unquestioningly pro-US policies alienated much of the rest of Asia, most importantly the emergent economic powerhouse of China.

In one area of government-society relations though, Koizumi and his cabinet pushed for the most radical of reform plans under consideration--the conversion of the country's system of national universities and colleges into individual, autonomous national university corporations (NUCs) in 2003-2004. However, this has to be qualified: the corporatization plan put into effect 1 April (the start of the fiscal and school years in Japan) of 2004 was not so much a break from the previous two decades of developments in tertiary education than a bold culmination in continuity with it.

Overview of Higher Education in Japan

Compulsory education takes in students up to grade 9 (the third year of junior high school), but continuance rates for senior high school are a very high - 95%, with graduation from them almost a matter of course for college-bound students (though the drop-rate from vocational schools is high). A common perception of colleges and universities in Japan is that they are selective and therefore entrance is only gained after passing rigorous examinations; however, continuance rates from the secondary to the tertiary level are now approaching 60%-70%--if one is flexible about what constitutes 'higher education'. Considering the declining populations of secondary level cohorts and the very low failure rate of matriculated students, it is possible to argue that Japanese tertiary education has for quite some time been in an era of open admissions and rivals the U.S. in at least the level of young adults' participation in higher education.

There are currently nearly 1300 accredited colleges and universities in Japan, divided approximately half and half between 2 and 4-year institutions (contrast this with the U.K's totals of 89 universities and 69 colleges of higher education). Even as it became clear that irreversible demographic trends meant fewer students in the future, Japan was still adding new schools well into the 1990s. Such a large number of schools creates a considerable tertiary sector unsurpassed in the non-anglophone world and second only to the US's in developed countries. If the various "senmon gakko" (sometimes akin to the European polytechnic, most usually like the American business college) are also included, the tertiary sector expands to an enormous scope taking in thousands of universities, colleges, and institutes.

Demographic decline and the extended economic recession of the 1990s forced change on Japan, and education has hardly escaped such effects; this includes the tertiary sector of education. One of the possible sources of Japan's economic running in place is demographics: as the society increasingly ages and retires but with a birth rate as low as Italy's, every year there are significantly fewer and fewer children entering the school systems of most prefectures and cities of Japan. Japan's high school graduate population of 2 million in 1992 is predicted to drop to 1.2 million by the year 2010. The question for debate and consideration is this: Can even higher levels of high school graduates enrolling in higher education compensate for the overall decline in numbers? In combination with their nascent efforts at adult life-long learning programs, many colleges and universities are hoping so. For the better run institutions, such hopes may not be entirely unfounded: there are fewer and fewer full-time white-, blue- and grey- collar jobs for high school diploma holders. Therefore, a college education has come to be seen more than ever as the basic award helping one to gain entrance to the adult world of full-time employment. However, even if schools can sustain their enrollments, it is certain that they will have to change in order to meet the needs of (1) high school graduates less academically prepared for sustained, higher level work and (2) older, non-traditional students who may not fit in with the youth culture that now prevails at this level of education.

University Reform: The Prominent Case of the National Universities

In sharp contrast to Japan's image as a nation known for a frenetic commitment to business, modernization and development, most of its national universities have seemed like relatively sleepy oases of teaching and research. Except for a handful of internationally known universities (such as Tokyo Daigaku and Kyoto Daigaku), the national university system had consisted mostly of small, provincial institutions scattered across the country. The national universities and colleges have, since the start of the post-war period, come under the direct control of the Ministry of Education. However the day-to-day running could be called 'collegial', largely managed by co-operating (but also competing) faculties, departments, committees, research labs and academic cliques. Now these universities find themselves at a historic crossroads, one which has brought them under heavy public scrutiny as part of expectations for broad social and institutional reform. In July of 2003, the Japan Diet finally enacted--after much debate--legislation which re-established its 87 national colleges and universities (consolidated earlier from a total of 99 institutions) as 'independent administrative agencies or 'national university juridical persons'; the term now used most often to refer to them is 'national university corporations' (NUCs). Parallel legislation also reorganized under one national agency 59 technical colleges--five-year institutions which combine the last three years of high school with a specialized, two-year tertiary degree. It should be noted here that there is also a parallel system of some 80 public and metropolitan institutions across Japan which are now being forced into a similar set of reforms as the national universities have undergone.

This new autonomy, however, could paradoxically mean potential for more arbitrary control from outside. The universities and colleges have been given their new independent status in order to revitalize research and teaching programs through more centralized administration and the need to prove their qualification for bloc grants while competing more and more for diminishing subsidy from the national government. This creates the first paradox of independence, because the national government and its education ministry can control the central review committees assigned to evaluate the institutions and their programs. Furthermore, the faculty, some of whom may eventually be forced to give up lifelong employment for a system of limited, competitive tenure, have doubts about the criteria by which their own job performances will be judged. University executives and management now have the responsibility of coming up with 'mid-term' six-year plans covering all details of administration, planning, operations, research and teaching.

Revitalizing and Enlivening Higher Education

The transition from a highly selective university system to one for mass education occurred in Japan in the 1970s-1980s. The country now has nearly 1300 universities, junior colleges, and technical colleges (with over 600 being four-year universities). There are over 3 million students enrolled in these institutions, with over 60% of senior high graduates continuing their education into higher levels. Japan's system is only exceeded in size and scope in the developed world by the US's, and is, in terms of its impact on society and the workplace, unsurpassed in the non-anglophone world.

The last decade and a half could be called the first real era of reform for Japan's mass university education system. An often-stated ambition of educational reformers in Japan has been the re-vitalization of the university system with 30 'world-class' institutions at the top. That is, reformers want a tertiary system that can compete with the US's in terms of (1) taught programs beyond the undergraduate level, (2) quantity and quality of basic and applied research, and (3) independence and diversity in financial resources. This goal is far from being realized, though an elite core of around 50 universities and institutes has emerged as better placed historically and geographically to flourish in the liberalized, competitive environment.

Until the early 1990s, because the numbers of high school graduates had always exceeded university admissions slots, matriculation was a reason for celebration. Despite the view that a university education was a four-year vacation from working life, graduation with marginal grades from even the middling universities conferred sufficient cachet to ensure recruitment into lifetime employment. That is no longer the case. Lifetime employment, never guaranteed for women or workers at the thousands of smaller companies anyway, isn't even a serious point of discussion for today's university-leaving job-seekers.

After more than a decade of an over-valued currency and the consequent weak economic performance, related political turmoil, and reform overshoot, more and more Japanese express a loss of faith in old institutions and ways of doing things. There is largely a consensus, though, that there must be reform, though consensus is lacking on what that systematic change should consist of, how it should be carried out, or who should bear the brunt of the immediate consequences. Typical of societies with developed economies and large middle classes, publicly subsidized education has become a major focus of reform, though consistency and coherence of vision is a problem Japan shares with the rest of the developed world.

Some of the goals of the reform being imposed on the national university system (where most university-based research takes place) are felt to be urgent, necessary, and a key component of Prime Minister Koizumi's reform administration. They include the following:

(1) Saving the debt-ridden national government money. This will most obviously be done by eliminating and combining programs, college-/school-level divisions, and even entire universities.

(2) Launching the universities into local self-governance with strict fiscal accountability to the center. Once independent, these institutions may well have to compete for funding among themselves or with other public and private universities. In fact, private universities support the reform of national universities because they hope such changes to the system will free up more public subsidy to go their way. However, given the current fiscal problems facing the national and local governments, it seems that in the long term, the situation will be many more universities competing for a declining pool of national government money. Clearly, universities that hope to survive, regardless of their original foundation (former national, former public, private non-profit, but also now private for profit), will have to find alternative sources of funding and endowment.

(3) Enlivening teaching through effective evaluation of teachers' performance and curriculum development. Many Japanese educators contend that Japanese universities do not foster creativity or flexible approaches to problem-solving in their students, and teacher-centred lectures are often cited as one of the main reasons.

(4) Through competitive tenure the institutions are supposed to become more internationally competitive in scientific and technological research. As already stated, one goal is to take the many small universities and combine them into larger, more cost-efficient operations. It is also hoped that this will result in synergies in basic and applied research that will create at least a handful of world-class universities among the few that will remain. Another reform that is already having an effect is the change in the civil servant status of national university professors, scientists and medical doctors which allows them to form research and business tie-ups with the private sector. Perhaps most importantly the former national and now former public universities are supposed to be put into a competitive dynamic with the more numerous private universities which, up until now, have survived on less government subsidy and higher tuition rates.

Reforming Research

Japan's decade-long recession and deflationary economy have significantly diminished its private industry's ability to finance research in science and technology. Despite slumping tax revenues, ballooning budget deficits, and deteriorating credit ratings, the national government has recently devised strategies attempting to compensate for the decline of private sector R&D. In so doing, it has also intertwined its agenda for increasing research expenditures with its agenda for effective educational reform, especially at the tertiary level. For example, in January 2001, its Science and Technology Agency (STA) was merged with its Ministry of Education (Mombusho) to form the Ministry of Education, Culture, Sports, Science and Technology (MEXT), an entity that gets a whopping 8% of the national budget. The government also hopes to focus and steer research toward social outcomes to fill future needs more efficiently than it thinks the diverse private sector can. The government's experiences at leading industry-wide R&D consortia reveal that the private sector's research activities are often not basic enough, or they are redundant rather than complementary. Government-co-ordinated efforts involving a large number of companies lack sufficient mutual trust across closely competing companies for there to be real co-operation and collaboration. Also, the national government feels it has to set policy for the 'big picture' of the political economy just coming into focus in ways that make macroeconomic sense if it hopes to foster international competitiveness. It is also widely thought that government policy and spending must galvanize the development of technical solutions to cope adequately with such problems as Japan's graying society or future energy supply shortages.

According to MEXT, in 2001 the national government budgeted over $35 billion for spending falling under the general category of 'science and technology'.Under its second 'Science and Technology Basic Plan' (now in effect), the national government is attempting to fund scientific and technological research at an amount worth 1% or more of GDP each year during a five-year period (from 2001-2005). If broader definitions of what constitutes scientific R&D are used (such as IT , AI and software research), that already large figure could be pushed upward to the $45-55 billion range. In order to help manage qualitatively this huge quantity of money, the second Basic Plan identifies four priorities for funding: life sciences, information technology, the environment, and materials science/nano-technology. Though only a fraction of the amount spent in the private sector on R&D, the bulk of scientific and technological research being conducted in tertiary education in Japan takes place at its 89 national universities (which get the bulk of the $17 billion given annually to university-based research).

The importance of research at these universities is evidenced by the relatively large faculties they have compared to other public or private universities, since many of the full-time employees of the national universities are engaged more in research than teaching. However, national universities invariably reported lack of space on urban campuses with run-down buildings and obsolete equipment. To fix these problems, MEXT had in place a 'Five-year Plan for Urgent Development of Facilities of National Universities'. Such funding efforts were actually a part of the larger Science and Technology Basic plan of the 1990s. In addition to paying for more space and new equipment for research, the goals of this expenditure were specifically (1) to expand graduate schools (including doctoral programs), (2) to promote, identify and reward centers of excellence in research (including 10,000 post-doctoral positions), and (3) to re-organize and develop the former medical colleges as university-annex hospitals capable of clinical research while offering advanced in- and out-patient medical care. These, along with many other goals being discussed, were felt to be necessary if Japan is to create at least 30 universities 'international standard'.

One question repeatedly asked about this 'top 30' goal, however, is: Does it pay anything more than lip service to the improvement of the teaching of undergraduate students--the traditional responsibility of many of the regional national universities? Although comparative studies of test performance in primary and secondary education consistently put Japan's education at or near the top of the OECD countries, international ranking of university systems based on multiple criteria puts its universities consistently at or near the bottom. The national government and MEXT have insisted that, among other things, their reforms for the national universities are intended to promote excellence not only in research but also in all levels of teaching and learning as well, by (1) allowing greater flexibility in admissions criteria (both for undergraduate and graduate programs), (2) focusing on the teaching abilities of academics through both internal and external evaluations, (3) granting national universities independent administrative status (corporatisation), (4) implementing a strict grading system for university students, (5) promoting fixed-term employment so that professors and researchers can transfer easily among universities and colleges, (6) increasing competitive grants for both individual researchers and for entire universities, and (7) establishing more professional and graduate programs up through the doctoral level .

Centres of Excellence (COE) Program

Not willing merely to de-regulate and re-structure, the national government has tried to help institutions attain world class status. For example, there is the government-funded, nationwide establishment of research-oriented 'Centers of Excellence' (COEs), mostly at the national universities and a few elite private ones. Any university or institute that hoped for future top-30 ranking might have helped its case by winning the right to host one or more of the COEs. There are some striking aspects to the plan which seem to raise more questions than they answer, leading to great controversy among national university faculties and administrations. First, there is the 'scrap and build' issue. The plan is supposed to ramrod the reduction and consolidation of the number of national universities, yet such efforts seem stalled because many universities administrations and faculties oppose forced mergers with larger institutions and/or departments, or they are uncertain how to proceed once a merger has been proposed.

Next, there is the related issue of the 'corporatization' of the national universities. The language of the plan says that management methods of the private sector will be introduced. Does this mean that the former national universities should be run along the lines of currently existing private ones, many of which are on the verge of bankruptcy, even as they charge fees 2-3 times greater than public universities? Or is what is meant by private sector management methods something along the lines of for-profit companies? The plan does not really specify just what are the management methods best adaptable to the needs of the national universities as they transition to forcibly merged independent entities of much larger size with multiple, dispersed campuses. Are current administrators supposed to bring in outside advisers and consultants, and, if so, where from--government, government corporations, government-backed NGOs, private corporations, business co-operatives, or third sector non-profits? And if they do, might not such measures actually increase management costs rather than lead to savings?

Questions about Revitalizing Scientific Research

The national government and its MEXT seem unrealistic in expecting two complex processes to be carried out at the same time in anticipation of immediate savings for the national education and science budgets (i.e., one, restructuring and mergers; two, transition to administrative independence). The third major point of the COE plan emphasizes a shift to a competitive system for awarding grants, with outside, peer review of grant proposals. This would seem to indicate that the national government is getting ready to reduce the annual bloc grants given to national universities, much of which support existing research as well as taught programs and subsidized tuition fees. On this third issue, the language of the COE program reflects the earlier call for a 'top 30' set of universities. Yet the plan confusingly calls for grants to go to the best 10-30 universities in each of the following disparate fields: life sciences, chemistry, materials science,information, electrical science, electronics, human literature, interdisciplinary subjects, and 'new areas'.

One obvious question concerning this last priority of the COE program is: Why don't the designated fields match more closely with the specific priorities set down in the Science and Technology Basic Plan? Also, it is not really clear just how definitive the qualifications of the 'expert committee' in charge of evaluating the grant proposals are, especially given the topical range of the actual submissions. Nor is it clear how objective, thorough, or peer-reviewed the actual process of selection was. What is clear is that for FY 2002, around $152 million was promised to be spent over 5 years on a total of 113 research projects scattered almost equally across all the fields listed above, at national, public and private universities located all over Japan.

What is also obvious is that there is as yet no obvious pattern for creating through competition and incentives a 'top 30' of universities or 100 'centers of excellence' in research. Moreover, the money going out through the COE program seems more to be rewarding already existing research programs rather than providing seed money to the new areas of research thought vital to economic and social revitalization. As if the current state of over diversification was not enough, the COE program promised that in FY 2003 it would make selections in still yet five more fields: medicine, mathematics/physics/Earth Science, machinery/civil engineering/construction/other engineering, the social sciences, and 'interdisciplinary' areas.

The COEs now in place across the nation are supposed to focus their activities on doctoral and post-doctoral research and scholarship--that is, if they are active at all. Capable researchers already at work in the relative safety of existing 'laboratories' (co-operating research and teaching groups) have proven reluctant to commit to the new centers. After all, the COEs have no long record of results and often lack a familiar sempai (older mentor) for a younger researcher to work under. Meanwhile, post-doctoral researchers from abroad with only survival level Japanese, such as those on EU stipends, have found many of the centers unable to operate with English as a common language for communication.

Other Types of Co-operative Research

One bottom-up variation of co-operative research that is starting to take hold is the non-profit organization (NPO), a type of entity only recently given official corporate status under national law. Academics from universities or researchers from newly independent institutes can form and run an NPO with a specific mission in collaboration with private companies, receiving aid from both the public and private sectors. Another recent revision to the laws allows academics and researchers at national and public institutions to serve directly on the boards of for-profit, joint stock companies and high tech start-ups (e.g., biotechnology) hoping to go public in order to further co-operative research, both in order to draw in funding from the private sector (much of it venture capital) for promising targeted research and for the purpose of speeding up the commercial pay-offs for such applied research. Finally, as academics move into the world of business, it seems quite likely that the world of business will come to them: As part of a nation-wide, bottom-up deregulation campaign, a Tokyo company involved in education and training has submitted a request to be allowed to start up a university and graduate school; legislative changes to existing laws governing education now allow for-profit entities to set up and run schools, including at the tertiary level.

Venture Businesses

Only universities and institutes that can conduct research and scholarship at the doctoral and post-doctoral levels can host a COE. So universities of all types (quasi-national,quasi-public, and private, including those with no chance for a COE) are now trying a more bottom-up strategy to raise funds and earn sustainable income: venture businesses (VBs). By 2004 close to a thousand such university- and research-institute- linked VBs were in operation, with a record 179 created in 2003 alone. Clusters of VBs have sprung up in the urban areas, such as Tokyo, Nagoya, Kyoto and Osaka. Unwilling to leave things to geographic chance, the national government has also funded 45 'venture business laboratories' nationwide, with most at regional second- and third-tier universities and institutes with faculties of science and technology.

Many of the VBs are joint ventures between a university and a group of investors or a company. Up until recently co-operation between universities and private enterprise usually put a top university in Japan into a tie-up with a top company in Japan. The key scientists and the companies often profited, but universities had no way to get their share if the research led to a marketable idea yielding profits. One recent change to benefit the universities has been the establishment of intellectual property offices on campuses. These can help academics and researchers file for patent, copyright and trademark protections while also assuring that universities get a share of profits from licensing agreements and money-making enterprises which commercialize the intellectual property.

Conclusion

As the Koizumi period of politics draws to its close, critics have already started to downplay the long-term impact of his mostly half-measure or stop-gap reforms. In one area of government-society relations, though, Koizumi and his cabinets clearly pushed for the most radical of reform plans under consideration and got what they wanted: in 2003-2004, the conversion of the country's system of 87 national universities and colleges into individual, autonomous national university corporations (NUCs). However, this has to be qualified somewhat. The plans for university incorporation that were put into effect 1 April (the start of the fiscal and school years) of 2004 were not so much a break from the previous two decades of developments and planned changes in tertiary education as they were a bold culmination in continuity with them. On the other hand, it must remembered that much of Japan's era of reform has been a panicked response to an economic crisis brought about by US policies that led to, among other serious problems, a severe over-valuation of the Japanese yen.

Those two prior decades of changes in tertiary education leading up to the creation of the NUCs comprised many profound developments, such as the following:

-the establishment of a handful of new research universities and institutes, decision-making at which flows from a central administration--in sharp contrast with traditions at national and public universities that are based on consensual, collegial relations across often rival departments and laboratories;

-the expansion of graduate program and their enrollments, including American-style professional schools of business, law, and accounting;

-growth in doctoral and post-doctoral programs, including in newer disciplines, e.g., IT, bio-technology, nano-technology, life sciences, and cross-disciplinary studies;

-a steady increase in the number of international students hosted, to over 120,000 annually, about 25% enrolled in graduate schools;

-more public funding of the entire tertiary sector, including private institutions, which outnumber national and public ones, with a target of 1% of GDP;

-increased funding for research (including more basic research) to compensate for its decline in private industry, with an accompanying shift towards competitive awards, with a target of 7-8% of annual national budgets, and a national goal of 3% of GDP for ALL scientific R&D (with national government spending accounting for 1% of GDP);

-legislative and regulatory changes that allowed the national universities to tie up with other entities to pursue research and expand course offerings, including tie-ups with other universities (of all types, national, public and private), research institutes, local governments, and private industry;

-parallel changes that allowed national university academics to serve on the boards of NPOs and for-profit corporations;

-internal and external systems of evaluation, independent of national government certification, going beyond minimal accreditation, and including accreditation for graduate programs and field-specific accreditation.

However, we predict here that these reforms will not be sufficient to save the tertiary sector in Japan from crisis and partial collapse. The demographic realities are harsh and inescapble. There simply will not be enough senior high graduates after the year 2010 to support the over-built higher education sector. Attempts at maintaining enrollments with international students (there are now over 120,000 studying in Japan) will reach a peak because of the language barriers, since Japanese universities are incapable of providing significant amounts of curriculum in English. An elite group of 50-100 institutions will emerge, while hundreds of colleges and universities will disappear--either absorbed by more successful ones or completely gone from bankruptcy and disestablishment. It is also unlikely that the government will reach its goal of thirty world-class institutions. If even ten institutions make lists of world rankings by the year 2020, and if these institutions are not necessarily limited to old imperial-national universities, these results will, in historical perspective, have been a major accomplishment.