New insight into what international students do next

Some 51% of international graduates remain in New Zealand five years after completing their qualification and some 39% remain after eight years, according to a Ministry of Education report published earlier this year.

Employment rates in the first year after study for international students are 63% at graduate certificate level and 45% at PhD level.

The report, Moving Places: Destinations and earnings of international graduates, is the first to give comprehensive information about what international students do once they have completed their studies in New Zealand.

“The most significant finding is that where an international student is employed and what they earn varies considerably, depending on a multitude of different factors,” Claire Douglas, deputy secretary at the Ministry of Education, told University World News.

“Similarly to domestic students, this includes the level and field of study of the completed qualification. Those who studied science, technology, engineering or mathematics (STEM) subjects, for example, tend to earn more. Earnings are particularly high for PhD graduates.”

She also highlighted the fact that “more than half of international students who finish certificates here then see the value of staying to continue study in New Zealand at higher levels”.

According to the report – written by Zaneta Park, a senior research analyst – international education is now New Zealand’s fifth-largest export sector, with the value of the industry estimated at NZ$2.85 billion (US$2 billion) in 2014. This includes earnings from tuition fees and living costs, and the value of the jobs created.

The report says it is estimated that around 14,500 jobs are directly linked to international education delivered within New Zealand and another 15,700 jobs are indirectly supported by the industry.

“International students are also valuable to New Zealand in terms of the cultural diversity they bring,” the report says. “The world that our young people are growing up in is more globally connected than it has ever been. Knowledge of different peoples and cultures is increasingly important. International students help to create links between New Zealand and other countries. These links may create business opportunities in the future or may be academic in nature.”

It says academic linkages help to ensure that New Zealand’s tertiary education system remains internationally competitive and will benefit both domestic and international students in the future.

Changes to work rights in November 2013 have encouraged more international students to stay on in New Zealand after obtaining their degree.

“For example, international students at masters level and above, are now able to work longer hours while they study in New Zealand, and some English language students now qualify for work rights. These changes increase the likelihood that students will have relevant skills which are in demand by employers once they complete their studies,” the report says.

Education New Zealand has reported that in 2015 some 26,024 international students studied at universities, 17,454 studied at polytechnics and 17,682 studied at private training institutions that submitted data to the Single Data Return or SDR. The total number of international students recorded in the SDR is 60,522. Of these around 3,500 studied in offshore campuses, the report says.

Another 24,912 international students studied at non-SDR reporting private training establishments and a further 21,005 studied at English language schools which do not report to the SDR.

Young international graduates with a bachelor degree who remain in New Zealand and work after they complete their studies tend to earn less than their domestic peers, except for those who studied nursing or medicine, according to the report.

However, earnings for international graduates who compete a qualification in science, technology, engineering and mathematics (STEM subjects) and work in New Zealand after completing their studies tend to be higher, with high earnings for those who study information technology, engineering and related technologies, and health.

The report said the reasons for the differences in earnings between young international graduates and their domestic peers have not been established, but they may include differences in the number of hours and types of jobs that graduates with the same qualification obtain or other factors such as English language skills.

Research has found that people with English as an additional language tend to work in lower-skilled jobs than people with English as a first language, even if they have the same level of qualification, the report says.

The situation for postgraduate students

Most young, international students who complete a postgraduate qualification in New Zealand study management and commerce, society and culture, engineering and related technologies or natural and physical sciences. Eight years after completing their studies in New Zealand, 60% or more of young, international students who have completed a postgraduate qualification in any broad field return overseas.

Overseas return rates are highest for those who complete postgraduate qualifications in natural and physical sciences and society and culture, with almost three-quarters of these graduates returning eight years after study (73% and 74% respectively), the report says.

“Both domestic and international graduates with higher level qualifications, such as PhDs, are most likely to explore their specialties overseas,” Claire Douglas says. “Altogether, this means that the quality of a New Zealand education, and our research expertise, is visible around the world."

Among young international students who complete a postgraduate qualification and then work in New Zealand, those who study information technology, engineering and related technologies and health have the highest median earnings.

Those who study natural and physical sciences have median earnings that are around average for all postgraduates qualified.

However, median earnings for graduates who study creative arts, society and culture, and surprisingly, management and commerce are the lowest paid. Mostly the management and commerce graduates are studying business and management, banking, finance and related fields and sales and marketing, the report says.

Tuition subsidy

The report notes that looking at outcomes for PhD graduates is of particular interest because since 2005 the government has paid a tuition subsidy to providers who enrol international students in PhD programmes.

“This subsidy recognises the contribution that these PhD students make to New Zealand’s national research output. Because their study is subsidised, providers may not charge them fees beyond the fees charged to domestic students. Analysing the outcomes of these students gives a sense of the return on this investment,” the report says.

It says there are two ways of measuring this. One is to look at whether or not these students tend to stay on in New Zealand after completing their PhDs, which means the knowledge and research skills they have obtained will contribute directly to the country’s knowledge base. The other is how much they earn in New Zealand if they remain.

The report says the latter is “an important measure, as how much an employer is willing to pay an employee is one way of determining the value of the skills of that employee to New Zealand’s economy. This is because employers will not usually pay an employee more than the value they bring to the business.”

PhD graduates more likely to leave

PhD graduates are the most likely of all international graduates to return overseas in the first year after completing their degree – 59% of PhDs of all ages, rising to 75% of PhD graduates after five years.

Some 34% of PhD graduates of all ages work in New Zealand the first year after they complete their studies, 26% in the second and between 23% and 15% in the third to eight years after study.

This is despite the fact that of those international PhD graduates who remain in New Zealand, their median earnings are “very good” compared to those of other graduates.

Median earnings for graduates of all ages are around NZ$19,000 higher than those for all international postgraduates in the first five years after study, rising to around NZ$27,800 higher, on average, in the sixth to eighth years after study, the report says.

Outcomes for international students vary depending on which country they come from. For example, Indian graduates are less likely to return overseas when they have completed their studies, and are more likely to stay in New Zealand and work, whereas graduates from ASEAN – Association of Southeast Asian Nations – and Gulf Cooperation Council countries are more likely to return overseas.

Earnings for those who stay in New Zealand to work also tend to differ for those who come from different countries, but it is likely that differences in study patterns explain many of these differences.