International education is among the largest Australian export industries with a staggering $37.6 billion contribution to the economy in just 2019. Furthermore, the sector has contributed a record $13.7 billion in just the State of Victoria. These statistics just highlight the significance of this industry on the Australian economy and the benefits can be further extended to the contribution of job growth and creation of new opportunities. However, 2020 has caused a significant interruption to our normal way of life and especially to overseas travel due to COVID-19. These interruptions have proven significantly detrimental to the Australian economy as we saw Australia’s economy going into a recession for the first time in nearly 30 years.
The following comparison between the 2019 and 2020, performed by the Australian Trade and Investment Commission, emphasises the impact of COVID-19 in international students’ enrolments:
- A decrease of 6.1% in total enrolments
- A decrease of 20.7% in commencements
While the majority of the international education impacts tertiary education and universities, there are schools that also have international students. The fees from international students making up a reasonable portion of independent school’s revenues. The timing of COVID-19 has further increased the damage, as the early sign of travel bans began to happen in early 2020 where majority of the international students visited their home country for holidays and they were not able to return to Australia. This caused some difficulties in the schools’ ability to collect outstanding fees leading to revenue reductions during the year.
So, what does it all mean for your school if you have international students:
- Assess the impact of having lower international students in your financials, especially on the cashflow and the budgets for future years. Since the fees for international students are payable in advance, reduction in these fees can lead to cashflow constraints, particularly in budgeted capital outflows;
- Look for new markets or new countries to obtain more international students. The fastest growing countries for international students are Philippines (20.5%), Colombia (7.4%) and Pakistan (6.6%);
- Maintain the relationships and connections in the current countries and markets. The top 3 countries of China, India and Nepal account for almost 51% of all the international enrolments. So, if your school has current international students from these countries, ensure that the relationships and connections are nurtured;
- Assess your school’s competitive advantage when it comes to international students, ask questions like what makes your school unique or better among the other schools. This understanding will assist in having a clearer value proposition when it comes to obtaining more international students.
Finally, with all the chaos and damage that happened due to COVID-19, there is a brighter future ahead of us, with the introduction of vaccines and treatments for COVID-19, we hope to get back to our normal everyday life and able to travel like before and hope to restore balance to the Australia’s economy and our schools.
Link to sources: