The impact of COVID-19 on Australian higher education and overseas students—what do the numbers say?


When COVID-19 travel restrictions were announced for travellers from mainland China on 1 February 2020, then for all foreign nationals (excluding Australian permanent residents) from 20 March, student visa holders and the higher education sector began to feel the impacts. Universities Australia has estimated $16 billion in revenue will be lost between June 2020 and 2023, and widespread job losses have been reported across institutions.

The factors influencing the financial positions and decisions of institutions are complex. While the publicly available financial information is not sufficiently detailed to enable a full assessment of universities’ current situations, this FlagPost provides an overview of some key data to understand the status of the sector prior to COVID-19, and the emerging impact of the pandemic.

Pre-COVID-19: Higher education enrolments 2013–2019

Higher education enrolments and commencements (enrolments in new courses) of overseas students have grown strongly since 2013. As shown in Table 1, growth has predominantly been from India and China, which together accounted for 58% of higher education enrolments in 2019.

Table 1: Higher education enrolments, overseas students, top five source countries, 2013–2019

  2013 2014 2015 2016 2017 2018 2019
Nepal Enrolments 8,005 10,144 12,176 15,123 21,339 28,120 34,403
% total 3.5% 4.1% 4.5% 5.0% 6.1% 7.1% 7.8%
Indonesia Enrolments 8,717 8,469 8,470 8,733 9,272 9,883 10,614
% total 3.8% 3.4% 3.1% 2.9% 2.7% 2.5% 2.4%
Malaysia Enrolments 14,962 14,348 14,395 14,586 14,647 13,982 13,080
% total 6.5% 5.8% 5.3% 4.8% 4.2% 3.5% 3.0%
India Enrolments 16,653 26,237 35,135 44,311 54,012 71,668 90,333
% total 7.2% 10.5% 12.9% 14.5% 15.5% 18.0% 20.5%
China Enrolments 85,724 89,087 96,768 112,505 133,542 152,534 164,458
% total 37.2% 35.7% 35.6% 36.8% 38.3% 38.3% 37.3%
All other countries Enrolments 96,658 101,065 104,697 110,048 116,271 121,936 128,107
% total 41.9% 40.5% 38.5% 36.0% 33.3% 30.6% 29.0%
Total Enrolments 230,719 249,350 271,641 305,306 349,083 398,123 440,995

Source: Department of Education, Skills and Employment (DESE), Basic pivot table 2002 onwards, extracted 23 July 2020.

Overseas student fee revenue

University finance data as reported by DESE shows that in 2018 (latest year available), fees from overseas student enrolments accounted for 26% ($8.8 billion) of university revenue. As shown in Table 2, this reliance has increased since 2013.

Table 2: Total Australian university revenue from fee paying overseas students, 2013–2018

  Total revenue from
all operations
($’000)
Change from
previous year
Revenue from
fee paying
overseas
students
($’000)
Change
from
previous
year
Percentage of
revenue from
fee paying
overseas
students
2013 $26,332,964 4% $4,290,808 4% 16%
2014 $27,751,858 5% $4,741,973 11% 17%
2015 $28,609,979 3% $5,349,879 13% 19%
2016 $30,147,079 5% $6,249,049 17% 21%
2017 $32,028,091 6% $7,457,002 19% 23%
2018 $33,741,910 5% $8,838,891 19% 26%

Source: DESE, Finance Publication, various years and Parliamentary Library calculations.

However, at institution level, overseas student fees accounted for between 8% (The University of New England) and 38% (Federation University Australia) of revenue among public universities, meaning the impact of declining enrolments could fall more heavily on some institutions than others. 

Andrew Norton, higher education policy expert at the ANU, has highlighted various explanations for universities increasingly seeking revenue from international student fees, including to make up for government funding cuts, top up funding for teaching Commonwealth supported students and government-funded research projects, maintain a teaching-research academic workforce, and improve their standing in international research rankings.

However, reliance on overseas student fees does not fully explain universities’ financial risk exposure in light of COVID-19. Analysis from the Centre for the Study of Higher Education at the University of Melbourne suggests that planned expenses, the need for additional spending on on-line learning and student support, and domestic fee income and investment losses, have all contributed to a precarious financial position for some Australian universities, while others appear to be relatively more stable.

Since COVID-19: Are overseas student numbers falling?

Visa data

Visa data provides some indication of the impact of border closures on the sector. Prior to the impact of COVID-19, student visa grants and numbers of students in Australia in recent years were trending upwards (see the Department of Home Affairs Student visa and Temporary Graduate visa program reports). Visa granting was put on hold in line with travel restrictions, so student visa grant numbers for all nationalities, but particularly Chinese students, began falling in February and have dropped significantly since, as shown in Figure 1.

Figure 1: Primary visa grants by month, higher education and postgraduate research sectors, 2018­–19 and 2019–20

Source: Department of Home Affairs, Student visas granted pivot table updated 30/07/2020.

While there have been very few student visa grants to applicants outside Australia since March, grants to applicants already in Australia, which account for about a third of higher education and postgraduate sector student visas (33% in 2018–19), have continued. For these sectors, grants in Australia are down slightly on the previous year. In addition, 80% of current higher education student visa holders were in Australia as at the end of March.

Enrolment data

DESE enrolment data currently covers up to May 2020. As shown in Table 3, enrolments have grown by 1% compared to May last year. However, commencements have declined by 14%.

In an ordinary year (2017 to 2019 in Table 3), around 20% of total enrolments, and 45% of commencements, occur after May. To equal 2019 numbers, a further 80,640 enrolments would be needed in the remaining months of 2020.

Table 3: Higher education enrolments and commencements, international students, full year 2017–2019 and year to May 2017–2020

  Total enrolments Commencements
  2017 2018 2019 2020 2017 2018 2019 2020
Total at May        279,943        319,255        360,355          362,992            79,545            86,683            96,833            82,847
Growth on previous year at May 14.6% 14.0% 12.9% 0.7% 13.6% 9.0% 11.7% -14.4%
Full year 349,083 398,123 440,995   148,685 165,551 177,473  
Proportion of full year at May 80.2% 80.2% 81.7%   53.5% 52.4% 54.6%  

Source: DESE, Basic pivot table 2002 onwards, extracted 23 July 2020.

Recommencing of grants for student visa applications outside Australia was announced on 20 July, but visa grants do not immediately equate to enrolments, commencements or arrival in Australia, particularly while borders remain closed.

While some students may continue to enrol and study from offshore, the impact of COVID-19 will be drawn out over the longer term.

This post was updated on 14 August 2020 to correct a figure in table 3.

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