Post on 13-Jun-2015
transcript
Key Challenges for the International Higher Education
Sector
ISANA Annual New Zealand Conference 2009ISANA Annual New Zealand Conference 2009
Professor Nigel HealeyProfessor Nigel Healey
University of CanterburyUniversity of Canterbury
OverviewOverview
Where have we come from? – a brief history of the international higher education sector
Where are we now? – the implications of the GFC
Where are we headed? – the outlook for the international higher education sector
The coming challenges for New Zealand universities
Where have we come from?Where have we come from?
Source: OECD Education at a glance, 2008
Long term growth in the number of students enrolled outside their country of citizenship
19750.6 M
19800.8 M
19850.9 M
19901.2 M
19951.3 M
2000 1.9 M
2006 2.9 M
Where have we come from - demand vs supplyWhere have we come from - demand vs supply
Looking backwards from 2009 – a golden era of growth
The ‘perfect storm’: rapid growth in the demand for international higher
education from developing countries
and
supply-side response from higher education providers in developed countries – especially the Main English-Speaking Destination Countries (MESDCs)
Where have we come from - deWhere have we come from - demandmand
Drivers of demand for higher education in developing countries are: per capita GDP growth
income distribution (‘size of middle class’)
knowledge economy
population demographics
Domestic higher education sector expansion is constrained…
…so unsatisfied demand by those with the ability to pay “spills over” into universities in the developed world
Rapid GDP growth fuels both demand for higher education and the ability to pay
WhWhere have we come from – demand and per ere have we come from – demand and per capita GDPcapita GDP
Source: Price Coopers Waterhouse
Where have we come from – demand and Where have we come from – demand and population pyramidspopulation pyramids
Where have we come fromWhere have we come from – s – supply (1)upply (1)
Why the supply-side response? Most universities publicly owned or funded; private universities
mostly not-for-profit
Higher education is heavily regulated and central part of government policy
Traditional view of higher education: higher education = a ‘public’ (technically ‘merit’) good
therefore higher education historically publicly subsidised, tuition free in many countries
foreign students - geo-political/development motives
Problem: higher education is a ‘superior good’, participation rates have increased from 5% in 1960 to 50% in OECD today
Massification challenges traditional view: private rate of return so high, no practical need for public subsidies
public subsidies lead to regressive distribution of income
governments have had to reduce real value of public subsidies as participation has increased
UK, Australia and UK first movers in introduction of tuition fees but domestic fees still regulated, even though public subsidies
inadequate
fees for international student deregulated first
differential incentive to recruit international students
Government policy has encouraged recruitment of international students to cross-subsidise research and domestic students
Where have we come from – supply (2)Where have we come from – supply (2)
Where have we come from – the big playersWhere have we come from – the big players
Student mobility in tertiary education (2006)
0
2
4
6
8
10
12
14
16
18
20%
Source: OECD Education at a glance, 2008
Riding the perfect storm – NZ higher education Riding the perfect storm – NZ higher education in 2005in 2005
International(non-resident)
Foreign(non-citizen)
Australia 17.3% 20.6%
New Zealand 17.0% 28.9%
UK 13.9% 17.3%
Switzerland 13.2% 18.4%
France 10.8% -
Germany - 11.5%
USA 3.4% -
OECD average 6.7% 7.6%
Source: OECD Education at a Glance 2007
Riding the perfect storm – increase in Riding the perfect storm – increase in international enrolments to 2005 (2000 = 100)international enrolments to 2005 (2000 = 100)
0200400600800
1000
Australia NZ UK
Switzerland
France
Germany
USAOECD
Source: OECD Education at a Glance 2007
New structured credit products
Movement to safe liquid assets
US housing downturn
De-leveraging
Initial Trigger
Pre-Conditions
Impacts
Sub-prime mortgage losses
Uncertainty about extent and location of risk
Booming credit markets
Where are we now – the globalWhere are we now – the global financial crisis financial crisis
Factors influencing demand to study overseasFactors influencing demand to study overseas
Cost of study abroad
Ability to pay for tuition and living costs from savings
by borrowing
by students working in host country
part-time while studying
full-time on graduation
Willingness to pay for tuition and living costs Uncertainty
Public security racism exacerbated by recession
Exchange rates: an important driver of NZ Exchange rates: an important driver of NZ enrolmentsenrolments
Source: Ministry of Education, RBNZ
2009
Exchange rates: low end courses more price Exchange rates: low end courses more price sensitive in NZsensitive in NZ
Source: Ministry of Education, RBNZ calculations
Where are we now – facWhere are we now – facining a bumpy rideg a bumpy ride
Cost of study abroad
Ability to pay from savings
Ability to pay by borrowing
Ability to pay – jobs in host country
Ability to pay – jobs on graduation
Willingness to pay – uncertainty
Public security
Where are we headedWhere are we headed – the IDP vision (1) – the IDP vision (1)
0
50
100
150
200
250
300
2000 2005 2010 2015 2020 2025
Mil
lio
ns
Forecast Global Demand for Higher Education
Forecast Global Demand for International Higher Education
0
1
2
3
4
5
6
7
8
2000 2005 2010 2015 2020 2025
Mil
lio
ns
Where are we headedWhere are we headed – the IDP vision (2) – the IDP vision (2)
Where are we headed – demandWhere are we headed – demand
Developments on the demand side Rapid expansion of higher education sector in developing
countries
Projects 211, 985, 111 in China
Private sector providers in Asia, especially India
New technologies and on-line learning
Growing consumer sophistication (QS-THES/Jiao Tong)
Growth in demand for international higher education from spillover may slow
Source markets likely to shift from undergraduate to postgraduate
Chinese enrolment rates (%)Chinese enrolment rates (%)
0
20
40
60
80
100
120
1990 1995 2000 2005 2006
Primary
Junior Secondary
Senior Secondary
Tertiary
Source: China Education Yearbooks
Where are we headed - supplyWhere are we headed - supply
Fiscal pressure will inevitably lead to deregulation of domestic fees (with means-tested student support) in first movers (UK, Australia, NZ) reduces attractiveness of international students
Late movers – Continental Europe and Asia – forced to introduce domestic fees, charge full-cost international fees Bologna and spread of English as a medium of instruction
New competitors in export education market, including many former source countries
Where are we headed – the future shape of Where are we headed – the future shape of international higher educationinternational higher education
US higher education as a model for global higher education
6,000 colleges and universities offering bachelors’ degrees Only state universities and major private schools offer
masters degrees
Only elite schools offer PhDs
Only rich and talented (scholarships) mobile at undergraduate level
Mobility increases at masters and PhD level
Model for the future at global level?
The challenges for New Zealand universities – The challenges for New Zealand universities – the starting pointthe starting point
Internationalisation has been rapid and opportunistic Rational response to unprecedented demand growth as a result of
public policy
Skewed to major growth markets – especially China, Korea
Unusually large role of key players Role of state schools as feeders to universities
Role of agents in bringing international students to NZ schools
Unplanned and (initially) unwilled expansion of numbers in universities International offices not geared up to managing, and later
sustaining, international numbers
Resistance to institutional adaptation to support internationalisation
International student visas by sectorInternational student visas by sector
0
5000
10000
15000
20000
25000
2000 2001 2002 2003 2004 2005 2006 2007
UniversityPolytechPTESchool
Source: Education New Zealand
The China effect: international visas issued to The China effect: international visas issued to ChinaChina
0
2000
4000
6000
8000
10000
12000
2000 2001 2002 2003 2004 2005 2006 2007
UniversityPolytechPTESchool
Source: Education New Zealand
Chinese visas as % of totalChinese visas as % of total
0
10
20
30
40
50
60
70
80
2000 2001 2002 2003 2004 2005 2006 2007
UniversityPolytechPTESchool
Source: Education New Zealand
Chinese students as % international tertiary Chinese students as % international tertiary enrolments, 2005enrolments, 2005
0
10
20
30
40
50
60
Australia NZ UK US
Source: OECD Education at a Glance 2007
The challenges for New Zealand universitiesThe challenges for New Zealand universities
Good news: We have excellent, internationally connected and
benchmarked universities
5 of 8 (62.5%) of NZ universities in THE Top 500
Universities multinational, multicultural environments
Bad news: Global faculty shortage – salaries falling behind
Rising oil prices, environmental awareness may erode multinational staff and student base
The Bologna effect
Asian universities upgrading capabilities very fast
The future for successful internationalisation The future for successful internationalisation of New Zealand universitiesof New Zealand universities
Understand our markets and the changing needs Understand our competitors Build long-term relationships built on mutual benefit, not
quick one-way gain Our differential advantage must be as a research-led,
postgraduate player
Celebrate and embrace internationalism NZ small trading economy, need to be internationally
connected to knowledge economy Integrate international students – networks of the future Use student exchange to create genuinely multinational
learning environment Ensure curriculum is internationally benchmarked
ConclusionsConclusions
International higher education has been driven by a perfect storm of demand and supply
The global financial crisis has stalled growth
Demand and supply factors are realigning to make the future different from the past
New Zealand universities has stumbled into internationalisation – surviving in tomorrow’s global market requires vision and commitment