Australian business schools count on return of international students

Australia’s higher education system has been one of the country’s hardest-hit sectors during the pandemic, as the stifling impact of border closures on international student numbers has cut its revenue in half.

Covid-19, and the government’s response to strict border controls – part of its “Australia fortress” policy – has stifled the flow of overseas students. Universities, a vital resource, shrank to A$20.2 billion ($13.8 billion) in the year to June, according to the Australian Bureau of Statistics. That compares with $38.7 billion in the same period in 2019, before the pandemic hit.

Universities and their business schools were quick to switch courses online and find ways to keep in touch with students locked in and unable to return to their home countries. However, enrolments from overseas have fallen sharply.

Government figures show 956,773 international students attended Australian universities in 2019, with more than 750,000 paying the full cost of a student visa. This year the number has dropped to about 446,000.

Eliza Littleton, an economist at the Australian Institute’s public policy think tank, said the industry had become “increasingly reliant on international student tuition fees, casual employment and underpaid staff — dysfunctions due to exacerbated by the pandemic”.

She pointed to Australian universities recording their first drop in revenue in eight years in 2021, leading to 35,000 job cuts across the higher education sector, almost a fifth.

University of Sydney
International students at Sydney University say online courses mean they “lose the real meaning of studying abroad” © Loren Elliott/Reuters

Roy Greene, emeritus professor at the University of Technology Sydney and former dean of the business school, said this had increased pressure on academic staff to increase teaching workloads. At the same time, research projects usually funded by international student fees have been cut, prompting many postdoctoral students and early career researchers to move overseas. “This has led to low morale in the higher education sector,” he added.

Geopolitical tensions between Australia and China have also hit universities that depend on a steady flow of international students.

In a speech at the University of Technology Sydney in June, China’s ambassador to Australia Xiao Qian was keen to stress the importance of educational links between the two countries. He pointed out that there are 131,400 Chinese students studying in Australia, accounting for 28% of the total number of international students in the country.


Number of job cuts in Australian higher education due to pandemic

According to the Australian government, the figure was down 20 per cent from the previous year, a steeper decline than students from other countries.

However, there are now signs that Chinese students may return in large numbers. Jon Chew, head of global insights at consultancy Navitas, said visa data for the first six months of the year suggested there had been a “full recovery” in the number of Chinese students. About 40% of them are returning students.

But Zhou added that the NSW Auditor-General had highlighted this reliance on Chinese paying students. Seven out of 10 universities in the state now report that China is the main source of income for overseas students, creating a concentration risk.

Chinese students drop The situation is less severe for business schools, however, as more students from India, Nepal and Indonesia enrol in recent years, reducing their dependence on income from Australia’s largest trading partner.

In addition, domestic demand unexpectedly surged during the epidemic. Mark Bar​​rnaba, who sits on the UWA Business School board and chaired it for nearly 20 years, said the business school proved unlikely to benefit from the country’s strict lockdown protocols.

“Domestic market increases as people stay at home [and] Choose to study during lockdown,” he said. “Companies looking to retain their workforce are also encouraged to do so and help cover costs. Overall, this is an unusual dynamic that benefits Australian business schools. ”

Chart showing foreign student enrolment rates in Australia

Melbourne Business School associate dean Andrew John noted that while its executive education business has declined during the lockdown, the school has had one of its highest ever enrolments for part-time students since September 2020 . “It didn’t surprise us,” he said.

The main changes at Melbourne Business School have been a slowdown in the “learning rate”, with fewer students studying two subjects at the same time. “We’re not sure if this is temporary, perhaps reflecting the stress and burnout generally felt in the Australian workforce, or if it’s a permanent shift,” John said.

Australia aims to attract more international students back to Australia and plans to reduce visa complexity – not only by increasing the number, but also by attracting more international students to become permanent citizens.

School leavers have become a concern for the higher education sector and the wider economy. If Australia loses its best students overseas, but also fails to retain international students after their studies, there is a risk of a “brain drain”. At the same time, the country faces a labor shortage with unemployment at a near 50-year low.

The government has responded with proposals to extend visas and extend residency and work rights for student visa holders – key to attracting more international students.

Barnaba, who is also vice-chair of mining group Fortescue and a board member of the Reserve Bank of Australia, believes the strict lockdown measures that have frozen so many international students as borders have reopened could even prove to be a boon.

“Australia’s strict Covid restrictions keeping the death toll low, combined with the strength of the economy and the general perception of being a safe and pleasant country” could make Australia seem like an attractive country to study, he said. .

Despite the “background noise” of geopolitical tensions, Green said Chinese students would continue to play an important role in funding in Australia and the higher education sector. “It’s like iron ore,” he said. “If someone says ‘let’s not deal with China,’ the economy is going to spiral down. It’s the same in higher education.”

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