(upbeat music) - What is the role of higher ed today in an economy being disrupted by tariffs and AI?

Jean-Francoise Coget, Dean of the School of Business at Sacramento State, joins us to discuss how the school is shaping the region's workforce and preparing students for an AI-transformed economy.

Welcome, Dean Coget.

- Well, thank you for having me on the show, Scott.

- I wanna start with this.

We're in a world where it is that it seems like that the old rules, go to school, get a good education, select a major where there's a lot of jobs and a lot of opportunity, and then, you know, do your darnedest to position yourself when you graduate to go ahead and move into the economy and then flourish in your career.

There is a lot of worry right now that AI and technology in general has disrupted that old equation between getting prepared and there being jobs waiting for you.

What do you hear on the ground, and what's Sac State thinking about on this?

- Yeah, no, that's a very real perception that I'm very aware of and all of us in higher education are, the perception that the return on investment, or ROI to use a business term of a college degree is declining.

And what I would retort to that is with facts.

The New York Fed estimates the median return on investment of a college degree to be 12.5%, which exceeds stock return and bonds, that varies from major to major.

Business is definitely one of those areas that has a great return on investment.

But that said, every time there's a new technology or a revolution happening, all organizations need to adapt.

And that's true for higher ed.

And higher ed is not always the most agile organizational form.

And sometimes we're slow to adapt.

And so there is now an urgency to adapt and make sure that we modernize and provide our students with the skills they need.

So with that said, AI is one of the biggest revolutions, technological revolutions we've faced in decades.

I would say it's bigger than the internet or it's comparable to the advent of personal computers, the internet, cell phones.

- I actually heard one person say last week that they considered it on the level of electricity.

- Yes, I would compare it to the industrial revolution, which is when we figured out how to use oil to first, you know, coal to power machines that could replace human labor.

And think about it, when you apply a machine and replace its what is arm and human strength, right?

That would build stuff.

You can have enormous gains of productivity, but it didn't happen overnight.

You need to reorganize the work in a completely different manner in an assembly line that, for example, Ford came up with the assembly line for the Ford T and reduced the time it would take to build a car by hand from one and a half day to one and a half hours.

So AI has the potential to do that for white collar jobs, but it's not gonna happen by itself.

And the role that higher ed has is the same as it ever was.

It doesn't really change.

It's to teach critical thinking to provide students with basic knowledge to understand the world so that they can ask good questions and evaluate the answers of those questions.

And that's AI right now, if you look at the type of AI that is the most popular, ChatGPT large language model AI can give you fantastic answers if you know how to ask good questions.

- If you know how to ask good questions.

I know that you've been working on this and that Sac State has been leading conversations on coming up with an answer to all this uncertainty.

Tell us a little bit about that.

- Yeah, well, so we are embracing AI transformation as our top strategic priority at the university and in the College of Business.

The College of Business is leading the way.

We just gotta prove a new program, a new concentration in AI management in the College of Business for undergraduates.

It's a bachelor of science, yeah, a bachelor of science in business administration with a concentration in AI management.

Very proud of that.

We developed it in six months, and got it approved, and it's already been offered.

- Really?

- Yes.

- Now where does that put you, you know, among other universities in California?

- I think we're one of the first, if not the first in the CSU to have such a program.

So we're very fast, the CSU, I have to say, the public education, we're very deliberative.

We have a model of how we make decision that we call shared governance, where the faculty have a lot of power in determining what needs to be taught and verifying the knowledge that is critically important for the credentialing value that universities bring.

We verify the knowledge that you can use.

- Unlike TikTok.

- Yeah.

Or like other, exactly.

And like other forms, we have a lot of ways of verifying the knowledge we provide, you know, despite what some critics might say, we vet our knowledge a lot more than other institutions.

So it takes more time to change, but we have to seize the changes happening faster and faster in the economic cycle in business.

We are aware of that.

I think the AI revolution, in five years, the world will look completely different, every job will look differently.

AI accounting using AI, marketing using AI, strategy using AI, supply chain, you name it, anything, nursing, all of that will be enhanced, 60% of all jobs is that the estimates will be affected by AI.

That doesn't mean that they will disappear.

They will be reorganized, some will disappear, some new jobs will appear.

And so we need as a university to anticipate that and change our programs to provide the skills that our students will need tomorrow.

So that's what we're doing now.

We're revising our curriculum beyond that one program, we're revising our entire curriculum at the university to try to anticipate what those skills will be.

But we need to partner with community to figure that out because nobody knows exactly.

- Well, let's go a little bit deeper on that.

Now your sort of research focus career wise has been organizational behavior and development.

- That's correct.

- And the concern, to kind of put it in that context, it's very heartening to hear about your new AI-focused undergrad degree program.

And it's also very heartening to hear about how you and your team are working on figuring out how to meaningfully infuse AI throughout the curriculum of all of the different disciplines that you teach.

Let's go to the organizational behavior and environmental kind of issues.

People are scared, Dean Coget.

People are scared because what they're experiencing is that for more senior level people, either they don't understand AI, they don't know how to prompt, and they're concerned about whether or not they're going to be able to hang on to their jobs, right?

At the middle management level, people, large corporations are clearing people out and collapsing levels of organizations to make them more efficient.

Which in one way, you can't argue with that because that they're driven by shareholder returns.

But then at the bottom level, there's a very distinct concern that the latter where people could come into the workforce after graduating that employers are cynically saying, "Well, you know what?

We can automate 80% of what these young people are coming out of school with with their bachelor's degrees or master's degrees."

And so we only need, you know, if we needed 10, we only need 2.5 now.

And so how does the school help prepare the students for those internal conversations when they have to interact and engage the world where it feels like at least it's getting tougher to find your place on the ladder.

- No, that's a very good question.

I'm very aware of these fears, and I think to some extent they're valid, and we need to take them seriously and think about solutions about it.

But first, I would like to say that I think the scenario you described, I believe may be over dramatic, overexaggerated, yes.

I think there will be certainly impact on jobs, but not like 80% of entry level jobs disappearing.

Not to that level.

And I would turn back again to the industrial revolution, which we've learned from the lessons, I think that's a good way, we can look at that period in history and figure out what happened and how to avoid the mistakes of the past, I would say.

But jobs did not disappear.

In fact, there was a boom in jobs.

What happened with the mass production markets, which led to the mass consumption society, the consumer society we know and take for granted today, was ignited by the industrial revolution.

And yes, the artisanal jobs disappeared and were replaced by factory jobs.

And that had some negative effects.

They were more boring, they were more repetitive.

But what Ford did is they increased wages tremendously.

At the time, it was in the 1930s, $5 a day was the slogan.

Sounds not like much today, but with inflation, I don't know where it would be, but it was a huge increase.

So that was one way to assuage the problem.

But I would say there will be jobs that will be displaced, and what you hear often is it's not that AI will displace people, it's people who know how to use AI will displace people who don't know how to use AI.

So we're making sure at Sac State that it will be done by a Sac State person who knows how to use it- - Made at Sac State, right?

- Yeah, exactly, I mean, and we believe in access.

You know, this is a new technology that levels the playing field either way.

So yes, it is a threat, but it levels the playing field.

And so for the students we have at Sac State who are from deserving backgrounds, but maybe they didn't have the same educational privilege that some might have had.

AI could, if they learn how to use AI, they could actually overcome some of their underprivilege, if you will, and use it as a liberating tool.

I might sound too of optimistic here, but I remember Steve Jobs, the late Steve Jobs, who called the computer a bicycle for the mind, you know, I always remember that metaphor, right?

Which was, the bicycle is the most efficient machine, if you will, that if you compare to a person running or walking, with your single muscle power, you can go much faster, increase your efficiency tremendously, right?

Same with a computer.

AI is like that, but to another level, another power.

And so there's a lot of dangers with it.

It's a very powerful tool.

There's a lot of limitations to it as well.

It's not as magical as people think, you know, but it has a lot of power.

And I think it's time to train the people to understand it and to use it responsibly to empower them.

And I think it's also important to not let the corporations and the business team say that, but take all of the profits, all of the productivity gains from AI and acquire it like happen in the industrial revolution.

There should be a more equal distribution of the productivity gains between the workers and the companies.

And to avoid having to create a better society.

And then it will benefit also corporations, because well-paid employees make consumers that then stimulate the economy.

- You know, it's interesting you say that.

So I am from Detroit, Michigan, okay?

And so Henry Ford was a pretty big deal back there.

And to take your story from a few minutes ago just a little bit further.

One of the reasons that he raised wages and also pushed for automation in the industrial revolution was because he wanted to make sure that his own employees could afford his own product, that's right.

And so it was kind of a virtuous circle.

So what you're referring to right now in terms of employers making sure that they don't take everything off the table, the investors don't take everything off the table, is to make sure that similarly in this revolution, there's still a virtuous circle for everybody.

- And to some extent, we benefit tremendously on that in California, we have a majority of the biggest tech companies in the world in California.

And even though some of them are leaving, they come back.

Even Elon Musk is back in San Francisco after leaving, you know, slamming the road to Texas because we have the know-how, we have the talents in San Francisco and Silicon Valley and elsewhere for AI- - And Sacramento.

- Sacramento with part of the Greater Bay Area.

I would love to attract more tech to Sacramento.

That's part of my gambit with the putting investing in tech and AI in the College of Business.

- Well that's actually an interesting thought.

What do you think are the ingredients we need to add more to to the Sacramento sort of stew in order to be able to attract more of those companies to come here?

Now we know, the secret is we know that a lot of the people live here and commute to the Bay Area because it's more affordable here or they like the quality of life.

How do we get more of that bricks and mortar down here?

- In some ways it's already happening.

During the pandemic, I think it started, people realize that wow, Sacramento is so close to the Bay Area.

It's much more affordable.

I always hate to emphasize that secret here on the TV and have more people come in because there's been an influx of people coming here.

The quality of life is incredible.

I've lived all over California and I moved here three years ago and I love it here.

It's a wonderful city.

And mainly, I would say it's the most affordable city in California, reasonable sized city.

So that alone, housing is affordable.

It's less congested, cost of living is affordable.

So that is a huge asset.

We're also the capital city, we're the center of the Central Valley.

We have a lot of water.

We have a lot of confluence of logistical hub.

And we are really, in fact, we're are already in the Silicon Valley, so we have already companies moving here.

It's kind of a trend, I think we just, you know, need to encourage more of them to come here.

Part of the strategy for us in the university is to create the workforce they need.

- And you know, I know that your president, Luke Wood, is very big on making sure that the campus is projecting itself outward into the community and things like that.

What are some of the important partnerships that you're going to be leveraging or you are leveraging currently to try and have more Sac State in more places helping to build this economy?

- Absolutely.

So the state is a huge stakeholder in public institution.

So even though we're a business school, a lot of our students go end up working in the public sector because we're in Sacramento.

And so we are, right now, for example, in addition to our AI concentration, are working on developing an AI certificate that might be focused on state employees to help train them.

The state is looking to apply AI to revolutionize how it functions.

So we're doing that, but I'm also exploring partnership with all of the tech players, OpenAI ,Microsoft, LinkedIn.

I tell you for example right now that I hope this gets LinkedIn, this partnership comes to fruition.

But where we were exploring a way to partner with LinkedIn to match our data of our students with the data they have on LinkedIn, on their career outcomes in the skills they have to talking about return investments, demonstrate the return investments of our college degree and track what skills they have.

And then in return, use that data to change our curriculum, to use that feedback loop to have continuous improvements to make sure that we continuously change our program, freshen them up, and correct any deficiencies we may see in the data.

So that's one example.

But we have the chancellor's office.

See, the CSU system has a connection with OpenAI.

We have free ChatGPT EDU, which is the equivalent of the plus version for everybody in the CSU.

And there's a lot of trainings and other relationships that they're leveraging that we are benefiting from.

But we love to explore public private partnerships, potential co-locations of services that could benefit the state and or other stakeholders in Sac State around AI, for example, healthcare.

So in some ways, it's a continuation of the strategy.

We define ourself as anchor university, which in fact is a Carnegie designated designation.

It's like universities.

We're also an R2, which is a high intensive research university.

And we are considered high community engagements.

And we really think of ourself as Sacramento's university, and we've always been, but we want to have stronger ties even with the community.

- I want to come back on the value of the college degree.

And you talked about a potential partnership with LinkedIn, and that sounds interesting on validating the value of the degree.

If Peter Thiel, the billionaire investor who is going around the country right now saying skip college, college is a con, it's a bust, just go ahead and start your own business or go directly into the workforce.

If he were sitting here right now, what would your response to him be?

- No, I mean, I would say he makes a good point, honestly.

He makes a good point.

And for some, it may be correct, not everybody needs to go to college.

And there are a lot of, people need to understand what they are into.

There's this Venn diagram for what is the best careers, what you're good at, what you like to do, and what the world needs, right?

The intersection of that is how you're gonna find your career.

There's things you like, but you're not good at, or things you're good at, but the world doesn't need.

So there's all kinds of ways to do this wrong.

For example, and especially in the AI world, for example, jobs like plumbing, electrical, trades, those are gonna be to some degree AI-proof.

Although I think AI probably will enhance them also.

And perfectly respectable career where you can earn a good living and you don't need to go to college for that.

But with that said, I would say college enhances the return on investment we discussed is real.

And for the majority of the people, it's gonna be a great investment.

Now there are a few, what Peter Thiel is referring to is the the entrepreneur who strikes in reach of the quitting college, like Steve Jobs and Bill Gates.

And for every Steve Jobs and Bill Gates, that story that we hear, there are hundreds of thousands of stories of people who quit college and who did not strike it rich.

Who even maybe have started a company and failed miserably.

So we don't hear those.

So it's a statistical inaccuracy or error.

It's a bias, we call it bias in psychology to think that because they're so visible, those examples are successful, it's like becoming a movie star or famous singer, same thing, right?

Celebrity, most people, the chances of making it are low, but they're so visible that people think it's achievable.

So I would say yes, a few will strike it rich with a Peter Thiel scholarship, but the majority won't.

And so college is not buying a lottery ticket.

College is giving you more surefire return on investments.

- Well, I will co-sign on that and tell you this.

As a serial entrepreneur who had multiple turns at Sac State as you well know, and finally graduated, not having the degree, I was able to make money.

But after finishing the degree, that's how I learned how to keep the money.

So sometimes going out and starting a business is great.

But having the training and the experience and the resources and relationships to sustain and grow that business become even more critical.

- I'm glad to hear you say that.

And so it gives you a perspective, a worldview beyond skills.

You know, universities are not just about skills.

You know, we're not just trade schools.

And also it gives you a network, it's a family.

So talking about the College of Business, we have 50,000 alums, 50,000, Sac State, 360,000, 70% of which are in the Greater Sacramento area.

So I can tell you, as a dean of business, if I want to meet CEOs or people high up in government or anywhere else, I will find Sac State College of Business graduates almost everywhere.

So it's an unparalleled network.

And if you compare to, say, UC Davis, which is another fantastic university near us in the state, most of the greats don't stay in the region.

It's a very prestigious university.

They have great degrees.

But if you want to live in Sacramento, Greater Sacramento, and have a network, Sac State is the way to go.

- I never knew that.

I can't let you go without asking you about one other thing.

And that is about tariffs very quickly.

You're from France, okay?

You've been in the US for a number of years, and you understand kind of like the trade relationships.

What's your opinion of the impact of these tariffs if they're sustained on the US economy and workforce?

- Yeah, that's a very complex topic.

I do want to say that I tend to favor free trade and believe that tariffs tend to have a negative impact overall.

At the same time, President Trump has a policy is using it for other public policy goals.

It's a long game that it's too early to tell whether it's gonna be positive or negative, right?

But overall, I would say that it impedes trade.

It doesn't encourage the free exchange, the free flow of information and goods in a way that I think is confusing the equation.

It's making it more complicated to do business.

And plus the erratic nature of them changing constantly is making it much harder to predict.

So it's increasing uncertainty.

And I understand also the long term, the gambit to rebuild an industrial base in the US with tariffs.

But that's a long plan that would take decades to actually happen.

And I'm not sure that the tariffs will achieve that.

So from this perspective, I'm a little skeptical, but yeah, I mean it's a complex topic.

I'm not an economist and I would say I'm a little bit beyond my depth to know what the final answer is gonna be.

- Okay, that's fine.

And we will leave it there.

Dean Coget, thank you so much for coming on and sharing with us the exciting new programs that are going on at the College of Business, and hope that you'll join us again when you've got some success stories to tell.

- Yeah, well thank you very much, Scott.

It's a pleasure to be here and I appreciate the opportunity.

- All right.

And that's our show.

Thanks to our guests, and thanks to you for watching "Studio Sacramento."

I'm Scott Syphax.

See you next time right here on KVIE.

(upbeat music) All episodes of "Studio Sacramento," along with other KVIE programs, are available to watch online at kvie.org/video.