The Australian International Student Problem
I’m going to use Deakin University as a bit of a case study for what is going on with Australian universities because Deakin has been one of the first universities in Australia to surface figures for job losses as a result of lost revenue from the impact of Covid-19. “The Age ” reports that there will be 400 job losses at Deakin, 300 of which will be staff who are currently employed by the university and 100 of which will be current vacancies that will not be filled. Why does Deakin need to axe these jobs? Well, because Deakin projects that it will lose between $250 million and $300 million in revenue next year. Consider this figure against an operating income of $1.2 billion dollars in 2017 and an operating income of $1.35 billion dollars in 2018.
It’s always worth providing facts and figures for income from international students because it highlights what one can only really consider to be the utter ineptitude of senior management at universities. So again according to “The Age“, “Deakin University relies on foreign students for 36.7 per cent of its fee revenue, which is lower than the state wide average among Victorian universities of 46 per cent“. Looking at the Deakin percentage in terms of dollar figures, “In 2018, Deakin made $343.21 million in revenue from international students and $591.16 million from domestic students“. Here I would locate the managerial ineptitude in the “putting all of your eggs in one basket” category. That category was international students. More specifically the category was international students from India and China.
Looking at Deakin’s student figures as reported in the 2018 publication, “Deakin at a Glance” Deakin had 57,595 course enrolments. Deakin had 11,878 international students who came from 130 countries. 31% of international students came from India and 28% of international students came from China. This means that as reported in 2018, 59% of Deakin’s international students came from just two countries. Looking at Deakin’s student figures as reported in “Deakin at a Glance” document from 2020, Deakin currently has 64,036 course enrolments. International student numbers stand at 16,616 students from 133 countries. 37% of international students come from India and 24% of international students coming from China. This means that as reported in 2020, 61% of Deakin’s international students come from just two countries.
How Much Revenue Are Universities Really Losing?
I reported months ago that during February 2020 around 30,000 international students entered Australia by using a loophole country – Thailand for example – as a means to beat Australia’s border controls. By staying in a third country for two weeks, these 30,000 international students were able to simply walk into Australia. I experienced this phenomenon during my holiday in Thailand. I travelled to Bangkok and then on to Phuket. The plane to Bangkok was about one third full and the plane to Phuket had only 21 passengers. On my return the planes were completely full on both legs of the journey and the vast majority of passengers were Asian. I couldn’t figure it out at the time and then I learned about the loophole country strategy for gaining entry to Australia. Everything then fell into place.
Today I came across a story from the “Times Higher Education” that has the Australian Prime Minister Scott Morrison raising this very point about the number of international students who actually are in Australia. The article reports Scott Morrison as saying that 80% of international students are actually in Australia. In this context Morrison questions whether universities really are losing the billions of dollars that they claim to be losing. The question of the number of international students who did arrive in Australia for Trimester 1, 2020 needs to be examined. Another factor that needs to be looked into is the number of international students who are now studying online as opposed to travelling to Australia to study. My guess, based on the shift to online delivery to international students at my own university, is that this number is not insignificant.
What’s Going on With Staffing at Universities?
The “Deakin at a Glance” document from 2018 has Deakin University proudly telling the world that Deakin employs 2,158 academic staff and 2,534 professional staff. The figures from the 2020 “Deakin at a Glance” document show 2,409 academic staff and 2,987 professional staff. This means that Deakin has more professional staff “running the university” than academic staff engaged in the core business of the university which is teaching and research. UK universities are in the same situation. The staffing figures from 2020 add up to a total of 5,396 staff which means that in reducing staffing numbers by 400, Deakin is cutting a little over 7.41% of its staff. So Deakin is cutting a significant number of positions and yet it is not clear just how much revenue the University is actually losing.
Furthermore, I suspect the true figure for the reductions in staffing are being hidden from us because university faculties rely heavily on sessional staff to carry out teaching. In some cases sessional staff make up 70% of all teaching staff in a Faculty. Sessional staff can be defined as those staff who are not employed in a permanent ongoing positions or who do not have a contract that extends beyond one year. From a public perspective, it is unclear whether the 400 job losses at Deakin include the figures for sessional staff who may simply be let go. My deep suspicion is that that the redundancy figures do not include sessional staff who will be let go and that behind the scenes Deakin, and indeed all Australian universities, are also cost saving through using the tactic of not re-employing sessional staff.
What Future For Australian Universities?
A story from the “Times Higher Education” reports on a Government plan to put a focus on Australia’s Vocational Education and Training (VET) sector. A key strategy here will be “enacting unrealised skills reforms recommended in a 2019 report by Steven Joyce, a former New Zealand tertiary education minister“. This focus on the VET sector might well indicate that Australia is going to look to the trades and professions as a significant dimension of a recovery plan in the post Covid-19 world. In this respect, Scott Morrison has referred to a newly created “National Skills Commission” that will analyse labour markets, identify emerging labour trends and provide information to prospective VET students about skills gaps and likely employment opportunities.
A natural question to ask here is what place universities as Australia moving forwards, particularly as there are those who have little sympathy with the plight of Australian universities . Scott Morrison mentions world class scientists and researchers as one of Australia’s key strengths and it would probably be fair to infer that the government has Science, Technology Engineering and Maths (STEM) subjects in mind when considering the road to economic recovery. Furthermore, if we take what Morrison has had to say about reinvigorating the VET sector along with his comments on science and research, then arts courses at universities could find themselves in a bit of trouble in the not too distant future. More broadly, I can envisage a time when universities will be heavily scrutinized in terms of employment outcomes / the employability of their graduates.
First Published May 27th, 2020