Australia’s higher education system has been one of the country’s hardest-hit sectors during the pandemic, as the stifling effects of border closures on international student numbers halved its income.
Covid-19 and the government’s response to tight border controls, part of its “Fortress Australia” policy, stifled the flow of overseas students. Revenue from this vital resource for universities fell to A$20.2 billion ($13.8 billion) in the year to June, according to the Australian Bureau of Statistics. This compares with A$38.7 billion for the same period in 2019, before the pandemic hit.
Universities and their business schools quickly shifted courses online and devised ways to maintain engagement with students who were locked out and with no way to return to their home countries. However, enrollment from abroad was reduced.
Government data shows there were 956,773 international students enrolled in Australian universities in 2019, with more than 750,000 of them paying full fees on a student visa. That number has dropped to about 446,000 this year.
Eliza Littleton, an economist at the public policy think tank Australia Institute, says the sector had become “increasingly reliant on international student fees, casual employment and underpaid staff , dysfunctions that were exacerbated by the pandemic.”
It notes that Australian universities saw their first revenue decline in eight years in 2021, leading to the cut of 35,000 jobs – almost one in five – in the higher education sector.
Roy Green, emeritus professor and former dean of the University of Technology Sydney’s business school, says this increased pressure on academic staff to increase their teaching workload. Meanwhile, research projects, often funded by international student fees, have been cut, prompting many postdoctoral students and early career researchers to move abroad. “It led to demoralization in the higher education sector,” he adds.
Geopolitical tension between Australia and China has also affected universities that depended on a steady flow of international students.
Xiao Qian, China’s ambassador to Australia, highlighted the importance of educational links between the two countries in a speech in June at the University of Technology Sydney. He noted that there were 131,400 Chinese students in Australia, representing 28% of the country’s international student population.
Number of job cuts in Australia’s higher education caused by the pandemic
This figure, according to Australian government data, is up to 20 per cent lower than the previous year, which is a steeper decline than for students in other countries.
However, there are now signs that Chinese students could be making a strong comeback. Jon Chew, global chief information officer at consultancy Navitas, says visa data for the first six months of the year suggests there has been a “full recovery” in Chinese student numbers. Approximately 40 percent of these were returning students.
But Chew adds that the New South Wales auditor-general has highlighted this reliance on fee-paying Chinese students. Seven out of 10 universities in the state now report that China is the main source of foreign student income, creating a risk of concentration.
The descent of Chinese students However, it has been less severe for business schools, as the growing number of Indian, Nepalese and Indonesian students who have enrolled in recent years has reduced reliance on Australia’s largest trading partner for earn income
In addition, domestic demand unexpectedly soared during the pandemic. Mark Barnaba, who sits on the board of the University of Western Australia’s Business School and was its president for nearly two decades, says business schools proved unlikely beneficiaries of the strict protocols of blocking the country.
“The domestic market increased as people isolated at home [and] chose to study during the lockdown,” he says. “Companies looking to retain labor also encouraged it and helped with fees. It was an unusual dynamic that generally benefited Australian business schools.”
Andrew John, associate dean at Melbourne Business School, notes that while its executive education business declined during the lockdown, the institute had one of its largest intakes of part-time students from September 2020. “We were not surprised by this.” he says.
The main change for Melbourne Business School has been a decrease in ‘study pace’, with fewer students taking two subjects at once. “We’re not sure if this is temporary, perhaps reflecting the pressure and burnout that, at least anecdotally, is being felt across the workforce in Australia, or if this is a permanent change,” he says John.
Australia is aiming to attract more international students to its shores, with plans to reduce visa complexity not only to increase numbers but also to tempt more of them to become permanent citizens.
Students leaving have become a source of 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 graduation, it risks a “brain drain”. At the same time, with unemployment at nearly 50-year lows, the country faces a labor shortage.
The government has responded with proposals to extend the length of visas and extend the right to stay and work for student visa holders, a key attraction for more international students to enrol.
And Barnaba, who is also vice-chairman of mining group Fortescue and sits on the board of the Reserve Bank of Australia, believes the strict lockdown measures that froze out so many international students could even be an advantage, now that borders they have reopened.
“Australia’s strict Covid restrictions kept fatalities low,” he says, “and, combined with the strength of the economy and the overall view of being a safe and pleasant country to live in,” this could make Australia looks like an attractive country to study. .
Despite the “background noise” of geopolitical tension, Green suggests Chinese students will continue to play an important role in Australia and the funding of the higher education sector. “It’s like iron ore,” he says. “If someone said ‘let’s not deal with China,’ then the economy would spiral. The same thing happens in higher education.”