University sector in crisis without international students: Mitchell Institute

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on December 14, 2021 Fact Checked
University sector in crisis without international students: Mitchell Institute

Mitchell Institute research shows without international students, the economy could lose up to $20b a year until borders fully reopen.

New international students in Canada, UK and the United States have largely recovered to pre-pandemic levels according to The International Education and the Pandemic report from Victoria University's Mitchell Institute.

In the case of the UK, new international students are 37% higher than pre-COVID. By contrast, new student visa applications for Australia have reduced by 70% in the 12 months to September 2021.

Report author Dr Peter Hurley said it was highly likely that many students who planned to study in Australia had gone elsewhere, particularly students from India who have gone to the UK.

"Part of the reason international students pay high fees is to experience a different culture and, for many, to immersive themselves in a country with a different language," Dr Hurley said.

"They can’t do that when they are studying online."

"For every six monthly missed intake of international students, we estimate Australia is losing about $4 billion to the economy. 

“Those losses are not one off but accumulate for the duration that the missed students would have been studying their course in Australia – usually three to four years."

Mitchell Institute research from April businesses tied to international students could lose $20 billion per year until borders fully-reopen.

Internationalstudent1.JPG

Source: Mitchell Institute

International students and the economy

The report warned that this isn't just a loss for the education sector, as most of the economic value of international education comes from students spending in the wider economy.

Data from October on university revenue revealed the impact that missing international students have had on the Australian real estate market.

Missing international students have had a direct effect on landlords who specialise in leasing residences to these tenants, and fewer students mean increased vacancies and lower rents.

States Ranked by Lost Share of 2020 International Student Revenue ($ millions)

Total Revenue

Fee Paying Overseas Student Revenue

1

ACT

$1,609.9 (-$233. 5)

$11.7

($313.5)

$318.5

($82.1)

-25.8%

2

Queensland

$5,734.5 (-$347.7)

$120.5

($195.3)

$1,350.8

($153.1)

-11.3%

3

Victoria

$10,251.2 (-$742.0)

$321.4

($540.0)

$3,211.9

($343.8)

-10.7%

4

New South Wales

$10,351.0 (-$675.5)

($41.1)

($400.6)

$3,068.9

($272.7)

-8.9%

5

Tasmania

$712.9 (-$65.1)

$18.0

($55.2)

$130.1

($11.1)

-8.5%

6

Northem Territory

$308.3 +$34.4

$42.8

$51.7

$50.6

$12.3

24.3%

Source: Juwai IQI, Mitchell Institute

Juwai IQI Co-Founder and Group Executive Chairman Georg Chmiel predicted in October the international student population was still at least two years away from returning to pre-pandemic levels. 

"Our best estimate is that Australia will get back to 75% of 2019’s resident international student population in 2022, but that getting back to 100% will take until 2024 or 2025," Mr Chmiel said.


Image by Annie Spratt via Unsplash

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Aaron joined Savings.com.au in 2021. He is a finance journalist with a keen interest in property, the share market, and improving financial literacy in young Australians.

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