Toxic Students and Zombie Universities

The term Toxic asset popularised by the global financial crisis represents financial assets whose value has fallen to a level where the holder wants to get rid of it but has no value in the market. Such assets cannot be sold and the holder
has to take the loss.

Another term, not as popular as toxic asset is
Zombie Bank. It describe banks which own a vast amount of
toxic assets. So they would have become bankrupt if such assets are re-valued to match current realistic levels.

The education sector can have its own toxic students and zombie universities if it is not careful.

Here is my definition of a toxic student.

A student whose chance of graduating with a degree is very low but continues to enroll in the various subjects in the faint hope that some qualification may be open to them or a student who has obtained a degree but cannot get a job or and is not
qualified to undertake quality higher education.


Why are such student toxic? Ultimate the value of a student to the university is defined by the market place (either the work force or admission into a high quality higher degree). I do not include the ability to pay fees or attract other funding which is equivalent to fees to represent value to the university. Thus a student who just continues in the university system
or has come an alumnus but has no future career based on their qualification has no market value.
A university that has many toxic students will soon be classified as a zombie. Since the toxic students have no market value, the university might be tempted to keep such students enrolled in various programmes especially if they represent a positive cash flow during their enrollment period.

Once an educational organisation gets the reputation of being a zombie university, good students will avoid it and the university will spiral to be a perpetual zombie. Publicly funded zombie universities will get generous government bail outs. Private zombie universities may have to declared insolvent if it cannot attract enough students.

From personal experience the only way to avoid the creation of toxic students is to have high entry requirements and strict progress requirements while at university.