6. Strategic Context

6.1 Economic impact

According to an independent report published by consulting economist Dr Warren Hughes in April 2009, The University of Waikato: Regional & NZ Economic Impacts for 2008, the University of Waikato was one of the Waikato region’s main drivers of economic prosperity in 2008, as well as being a significant contributor to the New Zealand economy. More specifically

  • University of Waikato operations together with the expenditures of its students generated $749 million – or 3% - of the Core Waikato 1 region’s annual revenue
  • this revenue impact rises to nearly $913 million - or 0.4% - for the New Zealand economy as a whole
  • the University directly and indirectly accounts for over 5,600 jobs in the Waikato Regional Council economy 2 (3.3% of total Waikato employment)
  • the University accounts for 5% of economic activity in the Core Waikato economy
  • every dollar generated by the University resulted in $1.21 of flow-on revenue across the Core Waikato economy
  • every job at the University generates another job in New Zealand, with two-thirds of these flow-on jobs located in the Core Waikato economy
  • students spent an estimated $166.59 million in Core Waikato
  • in Tauranga, the University’s 1,711 students spent an estimated $10 million, generating 125 jobs.(Hughes, 2009)

6.2 Regional demographics

Recent figures indicate that approximately 16% of New Zealand’s total population resides in the Waikato and Bay of Plenty regions3 (Statistics New Zealand, 2009), which comprise the University’s main catchment area.

76% of the University’s total domestic students typically come from this main catchment area. A further 10% of domestic students are actively recruited from the University’s inner and outer peripheries – that is, the wider region that includes Northland, Taumarunui, Hawkes Bay and Gisborne.

According to the 2006 New Zealand census, 15% of New Zealand’s population were Māori at that time. The comparative figure for the University’s main catchment area was 24% (Statistics New Zealand, 2009). In 2009, 22% of domestic students at the University of Waikato were Māori.

While almost 22% of New Zealand’s population nationwide is under 15 years of age, approximately 35% of Māori are under 15 years of age; the figures relating to the University’s main catchment areas are very similar (Statistics New Zealand, 2009). In the longer-term, New Zealand’s Māori population is projected to increase at a higher rate than the Euopean/Pakeha population, nationally as well as in the University’s main catchment (Statistics New Zealand, 2009). This means that the University of Waikato will continue to have an extremely important role to play in supporting Government’s tertiary education priorities with respect to Māori, especially in terms of fostering secondary/tertiary pathways as well as staircasing and articulation arrangements with other parts of the tertiary sector and improving retention and pass rates.

While the population of the University’s main catchment area is expected to grow by approximately 4% over the next five years, the number of 18 year-olds is expected to decrease slightly; nationally the number of 18 year-olds is expected to decrease by 6% over the next five years (Statistics New Zealand, 2009). This means that school-leaver numbers may decrease. However, enrolments at university are not necessarily expected to decrease to the same extent (if at all), because of a number of current trends: students are staying longer at school due to limited employment opportunities (Smart, 2009), increased numbers of students are attaining the university entrance standard (Loader & Dalgety, 2008) and the rate of transition from secondary to tertiary education has been increasing markedly over the last eight years (Ministry of Education, 2009a).

The University of Waikato is already taking account of the likely impact of the population and related demographic factors outlined above. In summary, even though numbers of young people are projected to decline slightly, the current recession is likely to have an ongoing positive impact on secondary school retention rates and, in turn, the flow through to tertiary study.

6.3 A changing economic and political environment

In 2006, New Zealand was in a period of economic growth with a low unemployment rate of 3.8%. Government policy was focussed on sustaining that growth through investment in the skills and knowledge of the workforce. With a change of government in 2009, the policy focus has shifted to managing the country through a difficult economic period in the short- to medium-term, while “continuing to make strategic investments for the long-term” (Ministry of Education, 2009b, p4).


6. Strategic Context

New Zealand has been in a recession since early 2008, due to “major global economic shocks” (Ministry of Education, 2009b, p3). Typically in a recession, the unemployment rate rises (Smart, 2009); currently the rate of 6% represents a nine-year high (Department of Labour, 2009). Long-term unemployment has also increased markedly over the last year, reflecting the number of people who lost their jobs early in the recession and who have failed to find employment since then. The unemployment rate nationally is expected to rise to around 7% by mid-2010 and a subdued economic recovery is anticipated, with economic growth only returning to its pre-recession level in the latter half of next year (Department of Labour, 2009).

The recession’s impact in the University of Waikato’s main catchment area has become very apparent over the last 12 months. The unemployment rate across the Waikato and Bay of Plenty increased from approximately 4% to 6% between September 2008 and September 2009 (Department of Labour, 2009). Despite a pick-up in the September 2009 quarter, the Waikato recorded year-on-year economic growth of -3.3%, and the Bay of Plenty -1.5%, compared with a national average of -1.8% (National Bank, 2009).

During an economic recession the increased demand for tertiary education is typically sustained after the economy has returned to normal. Evidence from overseas suggests that during a recession, participation in shorter duration university programmes is more sensitive to the state of the economic cycle, and rises; bachelors degree enrolments also usually increase proportionately with the unemployment rate. These patterns suggest that the University can anticipate increased applications to enrol in these types of programmes (Smart, W. 2009).

In 2009, Māori students formed 22% and Pacific Island students 4% of the University’s domestic student population. The impact of the recession is thought to be greater for Māori and Pacific Islanders due to greater proportions of youth. In 2009, the unemployment rate for Māori increased to 14.2%, from 9.6% a year earlier, while the rate for Pacific Island peoples increased to 12.3% from 7.7% (Department of Labour, 2009). These trends suggest that enrolment applications from students belonging to these ethnic groups may increase.

A likely further impact of the recession is that an increasing number of students from the University’s main catchment area who might otherwise have chosen to leave home to attend university will instead see the University of Waikato as a positive, more cost-effective option.

University of Waikato enrolments (EFTS) in 2009 were unexpectedly high (9.5% higher than in 2008), most likely because of the impact of the recession and the associated trends outlined above. As the University approaches 2010, tertiary study is expected to continue to be a particularly attractive option for people reacting to the recessionary environment, either finding themselves unemployed or wanting to guard themselves against the risk of unemployment.

Not only must the University address the future pipeline consequences of the economic environment and the unexpectedly high growth in 2009, but it must also plan for the recession’s ongoing impact into 2010 and beyond. In a capped funding environment, this represents a particularly major challenge, not only for the University itself, but also for a government that is committed to providing as many young New Zealanders as possible with access to high-quality tertiary education opportunities.

6.4 The secondary/tertiary interface

Typically, slightly more than 40% of the University’s new domestic students are school-leavers, who come from approximately 433 schools across New Zealand, with the majority from the North Island. In 2009, 69% of 1,524 school-leavers came from schools in the Waikato and Bay of Plenty and 18% came from schools in the Auckland, Northland and Counties Manukau areas. 45% of the University’s school-leavers came from 15 secondary schools.

The University of Waikato offers a number of programmes that promote and foster the successful transition of secondary school students through to tertiary study. ‘Update days’ were held this year on campus and in Auckland for secondary school teachers, to present them with information about research developments and other academic matters relevant to their subject areas. Every year, academic staff of the University provide examination revision and refresher programmes for NCEA Level 3 and Scholarship students.

A well-established Secondary Tertiary Alignment Resource (STAR) programme offers secondary school students the opportunity, while they are still at school, either to advance beyond the secondary school curriculum in particular subjects (in 2009, the University delivered STAR courses in Māori language, Chemistry and Statistics), or to undertake study in a subject that is not offered as part of the secondary school curriculum (in 2009 such subjects included Philosophy, Law, Computer Science and Management). In 2009 251 secondary school students enrolled for University of Waikato STAR papers. Students who have successfully completed a STAR paper at secondary school receive credit towards their university studies.

The 2009 University of Waikato Open Day in May was attended by 4,000 secondary school students, teachers, parents and visitors, and the University’s ‘Year 10 Experience Day’ in November was attended by 400 students from 12 invited secondary schools. The University again participated in the annual Waikato Te Ao Hou programme, which inspires young Māori secondary school students to achieve at school and progress to tertiary study.


6. Strategic Context

The Kotahitanga programme (‘Improving the Educational Achievement of Māori Students in Mainstream Education’), a research and professional development project in the School of Education at the University of Waikato, continues to see major improvements in student outcomes in participating secondary schools, and has now received major resourcing for a more expansive roll-out. The professional development/ research project, which began in 2001, involves 33 schools around New Zealand, hundreds of teachers and thousands of Māori students.

Academic staff of the University serve as judges of a number of secondary school competitions, including national Kapa Haka and speech competitions. In addition, the School of Law holds an annual secondary schools mooting competition, which is well subscribed by secondary schools across the greater North Island region.

University of Waikato graduate, Atlantic rower and polar trekker Jamie Fitzgerald delivered the Reaching Peak Performance The Edge of Stretch programme to Year 12 leaders from 15 secondary schools this year and delivered an additional session to University of Waikato Sir Edmund Hillary scholars. The prestigious Hillary Scholarships, offered since 2005, are awarded to high achievers who show leadership qualities and also excel in sport or in the creative and performing arts. The scholarship includes comprehensive support for the recipient’s academic, sporting and/or arts activities, and additional support in leadership and personal development. 44 new Hillary Scholarships were awarded in 2009, bringing the total to 218 students since 2005.

The Vice-Chancellor’s Prize for Academic Excellence, another in a wide range of school-leaver scholarships and prizes, was awarded in 2009 to 21 secondary school students nominated by their principals.

6.5 University relationships within a regional network of provision

The University of Waikato has signed deeds of cooperation with both the Bay of Plenty Polytechnic and the Waikato Institute of Technology (Wintec). The University recognises the benefits of a differentiated system of tertiary education in New Zealand, in which universities and polytechnics have distinctive but complementary contributions to make to the delivery and support of relevant, quality, tertiary provision. In this context, the University has negotiated with both polytechnics a variety of contract teaching, articulation and other types of arrangements for staircasing into higher level tertiary qualifications.

In 2009, 56 students transferred from the Bay of Plenty Polytechnic into higher level qualifications at the University of Waikato, and 176 students transferred to the University from Wintec.

The University of Waikato also has a long history of collaboration with Tairawhiti Polytechnic, with which it offers a number of papers through articulation and contract teaching arrangements.

6.6 The Western Bay of Plenty

Population growth and economic development in the Western Bay of Plenty region are strong and ongoing (SmartGrowth, 2009a). For several years now, the University of Waikato has expanded its teaching and research activities in the Western Bay of Plenty, in order to meet demonstrated needs associated with the economic transformation of that region (SmartGrowth, 2009b).

The region has identified nine economic challenges and impediments to economic growth, five of which relate directly to skills, training and education. One of those challenges is the advancement of strong relationships with tertiary education and research institutions, not only to provide direct training for those employed in key regional industries but, more importantly, to provide the intellectual input to drive innovation and entrepreneurialism. These are the cornerstones of new product development, efficiency and ‘value-added’ productivity (Priority One, 2008).

Statistics show that the Western Bay of Plenty population is close to the national average in terms of educational and vocational qualifications but that it lags behind the national average in terms of tertiary qualifications. The 2006 census indicates that only 8.2% of those living in the Western Bay of Plenty have achieved qualifications at bachelors level or higher; this is substantially lower than the national rate of 14.2% (Statistics New Zealand, 2009). The low rate of university education impacts on the region’s skill shortages and, in turn, the region’s ability to support its economic growth.

With strong support from Priority One, the Western Bay of Plenty region’s economic development agency, the University of Waikato has actively and successfully advocated increased government investment in tertiary provision in the Bay. Over recent years, University of Waikato numbers have grown steadily from 244 EFTS in 2005 to 412 EFTS in 2009.

Subject to funding beyond the current TEC funding cycle, the University proposes to continue its growth strategy in the Bay in partnership with the Tauranga community and the Bay of Plenty Polytechnic, while at the same time continuing to invest in research capability to underpin the region’s entrepreneurial, business and industry sectors.


6. Strategic Context

6.7 Relevance of qualifications and graduate outcomes

The University undertakes regular reviews of existing qualifications and programmes to ensure that they continue to meet the needs of industry and maintain their relevance for students. In 2009, the University implemented 25 Significant Academic Developments (approved by the NZVCC Committee on University Academic Programmes (CUAP)), 18 of which involved changes to existing qualifications, with a further four involving changes to entry requirements. Three new qualifications were introduced: the Doctor of Musical Arts, Bachelor of Social Work and Master of Business Management. In addition, a range of further Significant Academic Developments were developed and put forward for consideration by the NZVCC CUAP for implementation in 2010; these included the introduction of two new qualifications (the Bachelor of Media and Creative Technologies and Bachelor of Environmental Planning), as well as the discontinuation of one qualification and three subjects.

A report published by the Ministry of Education, Outcomes of the New Zealand tertiary education system, provides evidence of the pivotal role played by the New Zealand tertiary education system in the economic growth of New Zealand (Smart, 2006). Economic growth depends on labour productivity. Labour productivity depends on high employment. Tertiary qualifications enhance the employment prospects of New Zealanders; attainment of tertiary qualifications also results in higher incomes and, in turn, healthier lifestyles.

Data which suggest links between qualifications, employment and income levels, are helpful to the University in identifying and responding to student and market signals and monitoring their particular impact on employment outcomes. With this in mind, the University is participating in a university sector-wide project involving a longitudinal study called the New Zealand University Graduate Outcomes Survey. The results of the survey will help the University develop its understanding of how outcomes are changing for graduates over time and inform future direction and recruitment activities.

6.8 The University budget and capped funding

In budgeting for a 2009 surplus, the University took careful account of the likely challenges ahead in terms of increasing revenue in a capped funding environment and adjusting its costs to match the expected fall in student-related revenue.

Government’s tertiary funding reforms, which took effect in 2008, impacted on the University of Waikato at a time when its enrolments were still recovering from an earlier decline. Having peaked at 11,575 in 2003, the University’s total EFTS had declined to 9,685 by 2008. While the most severe decline during that period was related to Full-Cost International (FCI) enrolments (consistent with national trends at that time), Ministry-Funded (MF) enrolments also declined, a trend that had started in 1999.

MF enrolments had begun to recover in 2007 and, by the end of 2009, were well beyond the 2003 levels. The value of the University’s MF enrolments in 2009 exceeded the TEC’s funding cap by over 6%, representing a government funding shortfall of approximately $3.4 million. While FCI EFTS were higher in 2009 than originally forecast, they were still far short of 2003/2004 levels.

2009 was set up to be a transition year, in which costs would be reviewed and new operating plans developed. Costs were managed very tightly throughout the year, and while many of the initiatives developed in 2009 to enhance the cost-effectiveness of the University’s operations will not be fully implemented until 2010, the University’s 2009 financial outcome was very positive.

The whole tertiary sector faces the prospect of ongoing constraints in government funding and so the University will continue with an approach that involves managing costs, constantly seeking efficiency gains and exploring additional sources of revenue, while ensuring that its investments in future capability are well informed, prioritised and targeted.

6.9 Research

The University continues with prioritisation and consolidation of research activities, simplification and strengthening of research and postgraduate support, ongoing development of inter-institutional research collaborations, and the alignment of new and established research capabilities with global research themes, national science strategy and regional R & D needs.

In parallel, the scholarship and creative work in the humanities and performing arts form a major strength of the University of Waikato with many fine performances and productions occurring in the WEL Academy of Performing Arts.

Government has identified innovation as a key driver for economic growth. This university’s awareness of the importance of science and innovation as an economic driver and its central role in improving health, environmental and social outcomes, is reflected in its research priorities and goals. The University of Waikato plays a key role in the local economy and makes a significant contribution to the national innovation system. It continues to be a significant player in the Waikato Innovation Park, which creates wealth for the region through the nurture and support of innovative local companies and the overseas sale of specialist knowledge and expertise.


6. Strategic Context

The value of research contracts entered into by the University of Waikato in 2009 (to be realised over the life of the contracts) is $38.3 million; almost twice the value of new research contracts committed in 2008. This has been achieved through increases in value of contracts in all areas of the University, with particularly large increases in the Faculty of Arts and Social Sciences, and the Schools of Education, Science and Engineering, and Management.

New staff were appointed as research and scholarship developers to work within the University Research Hub. They will assist researchers to grow revenue and align major research grant applications with national science strategy and national and international funding opportunities. Research institutes and centres were reconstituted during 2009.

A series of major initiatives were undertaken in 2009. One of the flagship initiatives was the groundwork undertaken towards the establishment of four new Research Institutes, namely the Environmental Research Institute, Māori Research Institute, National Institute of Demographic & Economic Analysis (NIDEA), and the Waikato Business Research Institute. Other projects include a comprehensive internal research assessment exercise, the introduction of ‘Postgraduate Research Month’, professional development workshops, doctoral workshops, an expanded summer school programme, the “Thesis in Three” competition, recruitment and induction programmes for postgraduate students, and expanded staff excellence awards recognising major contributions to teaching and research. In addition, the University has reinvented its research website, introduced a Higher Degrees Handbook, and established a continuing series of workshops for postgraduate students, supervisors and administrators.

The University of Waikato has strengthened research-based relationships with many private and public sector organisations and a number of carefully selected international institutions. Particular initiatives have been undertaken with District Health Boards in the Waikato and Bay of Plenty, with Priority One, the Port of Tauranga, Zespri and Fonterra. Research relationships are also advanced with regional environment agencies in the Bay of Plenty and the Waikato, and with Crown Research Institutes, particularly AgResearch, Geological and Nuclear Sciences, Landcare Research and NIWA. There has been notable growth in research capability, professional service provision and degree teaching in relation to land-based industries, especially Agritech and AgriBusiness and in health, especially in Māori psychology, community health, demographics, population studies, health diagnostics and social work.

Research grants, postgraduate scholarships and research-related donations were received from 96 organisations external to the University in 2009. This represents further progress in the ongoing diversification of sources of research support, and a further increase in inter-institutional and international research collaborations.

Government recognition of the crucial role science and research have to play in creating the future prosperity and wealth of New Zealand is particularly welcome. WaikatoLink’s excellent record and ongoing activities in taking university research-based IP to market, onshore and offshore, positions it well to support government strategic priorities in this area.

The University recognises the importance of maintaining its position in the top three New Zealand universities through PBRF 2012 and has invested significantly in strategic research developments during 2009-2010. The University has strengthened its knowledge transfer activities through increasing numbers of quality-assured research publications, conference participation and collaborative research leadership.

A major effort in relation to research relevant to Māori economic development, educational success, health, governance and law has been a particular highlight of the 2009 year and this is ongoing. Financial support for a range of major research and development programmes received from the Ministry of Education and the Tertiary Education Commission is gratefully acknowledged.

Linked to the University’s goals with respect to research publications, knowledge transfer and commercialisation of IP is its intent to increase the proportion of research postgraduate EFTS. The University matched Government’s investment of $250,000 in 2009 for 100 Summer Research Scholarships. This was additional to the University’s own investment of $3 million as part of its annual Budget, in a Strategic Research Investment Fund, which is designed to elicit and support initiatives that develop the University’s research and research supervision capability. The University also invested $2.8 million in University of Waikato Doctoral Scholarship support for 112 domestic doctoral candidates in 2009. $758,000 was also invested during 2009 to support 65 Masters research students.

  1. Core Waikato is defined as Hamilton, Cambridge, Te Awamutu, Huntly and Ngaruawahia
  2. Waikato Regional Council economy is based on the 9 District Council (Thames-Coromandel to Waitomo and Taupo regions) surrounding and including Hamilton City
  3. The Waikato region is defined as comprising the districts of Waikato and Waikato South, Franklin, Thames-Coromandel, Hauraki, Waipa, Otorohanga, Matamata/Piako, Waitomo and part of Rotorua and Taupo. The Bay of Plenty region is defined as comprising Western Bay of Plenty, Whakatane, Opotiki, and part of Rotorua and Taupo

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