Business schools are often regarded as the “golden goose” of universities, as their substantial revenues support other research-focused departments, warns Robert MacIntosh, chair of the Chartered Association of Business Schools and pro vice-chancellor of the business faculty at Northumbria University.

MacIntosh highlighted that the decline in international student enrollment is impacting business schools. He asserted that with rising costs and decreasing real-terms income from domestic students, universities face the risk of underinvesting in business schools.

“Business schools are largely profitable, so there is definitely a golden goose aspect,” he explained. “In any other business, generated surpluses would be reinvested to maintain competitiveness and high-quality student experiences. There’s a concern that we may asset-strip our business schools or prevent them from reinvesting and growing.”

MacIntosh noted that although he has not yet observed university vice-chancellors protecting other subjects’ budgets over business, the risk persists. “Business schools often transfer tens of millions in surplus income to the parent university, supporting professional services, libraries, and various other disciplines,” he said. “When business schools face financial challenges, due to declining international student numbers, the parent universities quickly feel the impact.”

Over 50 universities have recently announced layoffs, with recurring cuts at institutions including Aston, Cardiff, Nottingham, and Hull. In May, the Office for Students, an industry regulator, reported that 40 percent of all universities in England anticipated financial deficits this year.

MacIntosh is transitioning from Northumbria to the University of the West of Scotland to become the pro-vice-chancellor for research and innovation. Times Higher Education revealed that at least 20 percent of UK universities are changing their vice-chancellor or faculty leadership this year.

Having spoken to several business school leaders, MacIntosh observed that the financial outlook varied. “Many prominent universities are experiencing a significant drop in international student recruitment, while some see an increase,” he noted.

Larger universities’ business schools can enroll 2,000 to 3,000 international undergraduate students annually, he said, each paying fees of about £22,200 per year, compared to £9,250 for domestic students in England and Wales and £4,750 in Northern Ireland. MacIntosh foresaw continued strain on business schools in the current academic year.

MacIntosh has held senior leadership positions at the business schools of Heriot-Watt, Glasgow, and Strathclyde and views business schools as the “front door” for local businesses to entire universities.

He dispelled the assumption that “business schools” primarily interact with large, corporate private sectors, highlighting that MBA students represent only 8 percent of the total in a typical business school. “We engage significantly with start-ups, small businesses, charities, and public organizations,” he emphasized.

“Businesses are not always inclined to reach out to universities directly. However, they often see business schools as a safe space,” he added. “This can lead to discussions about challenges in various fields like chemical engineering or actuarial mathematics, connecting businesses to the right experts.”

MacIntosh encouraged small business owners to join the government-backed “Help to Grow” management training scheme, offering 50 hours of structured learning and access to mentors for £750.

The initiative, launched by Rishi Sunak, is funded until next April and has been adopted by over 7,000 businesses. “There’s a vast opportunity for those who haven’t yet participated,” he said. “The program is still available and has withstood the transition of government.”

MacIntosh urged the new government to include post-graduate training in their upcoming reforms of the apprenticeship levy. Since 2018, employers have been restricted from using the levy to train their middle and senior managers. While large private companies were perceived as overusing the scheme, it was also beneficial for the NHS and other public sector entities.

“Public sector organizations were enhancing their skills through this process,” he stated. “If I were in business, I’d question why elected representatives oppose using the levy for post-graduate apprentice training for leadership teams, given the difficulty in utilizing contributions effectively.”