Over-optimism and under-investment in IHE export models

Over recent years, three of the four leading English-speaking countries in international higher education (IHE) – the United States, the United Kingdom and Australia – have seen their market share in international students reduced, in spite of some enrolment growth. Canada has been the exception.

Competition from non-anglophone countries, in particular China and other Asian countries but also from continental Europe (with the two leading countries France and Germany, as well as others, including Russia and the Netherlands), and an increase in intraregional mobility between neighbouring countries elsewhere, is one factor for this decline.

Unwelcoming immigration policies in the UK and the US have been another factor, and, in the UK, Brexit.

The COVID pandemic has put on hold student degree mobility in 2020 and will also have a negative impact on 2021.

What are the prospects for these four leading countries to maintain or increase enrolments in the years to come, now that vaccines provide the prospect of going back to a pre-COVID normal, the Brexit deal is completed, the Trump administration has been replaced by a more welcoming Biden administration, with all of this set against rising geopolitical tensions and economic downturns which will affect sending students of the middle classes?

Beginning with the UK, which has recently set out an optimistic recruitment strategy for the coming years, we analyse and critically compare their prospects.

United Kingdom

The latest (February 2021) update on the UK government’s international education strategy focuses particularly on enhancing revenue (to £35 billion or US$48 billion per annum by 2030), including through growing international student enrolments. Essentially it is a strategy for education export rather than international education.

However, the approach does include a few welcome changes, for example, it identifies a real need to enhance the quality of the international student experience. And, very importantly, it sets out a new graduate immigration route to facilitate access to employment in the UK after graduation.

Also highlighted is the potential of the schools sector, English language providers and technical and vocational education and training (TVET), and this is also to be welcomed.

In 2019 there were approximately half a million international students in UK universities; there may have been many more, but for the stricter immigration policies of recent years.

A significant proportion of revenue growth anticipated in this new strategy is expected to be generated by the higher education sector, particularly through international students. However, what is not mentioned explicitly is that most of the effort required to do this, including investment, will fall on universities.

For their part, UK universities need to generate international revenues as they have become very dependent, some probably over-dependent, on such funds. And now they are also faced with new falls in enrolment, due to the double impact of COVID and Brexit.

The latter could result in the loss of over 50,000 students to UK universities, including many research students, and this is not addressed within the new strategy.

Transnational education (TNE) is identified as offering potential for growth and revenue, but all indications are that TNE growth had become static up to 2019. Whether this might now change, due to COVID, has yet to be seen but, given the pre-COVID trends, significant new growth appears unlikely.

This is compounded by the nature of TNE – it requires long lead times to initiate new programmes, with marketing approaches very different to those well understood for recruiting international students to the home campus.

One gap in the UK government approach is the lack of acknowledgment of the importance of partnership, mutuality and what might be viewed as the ‘virtuous circle of benefits’ that underpins international higher education relationships.

For example, whatever activity is initiated, say, developing a research partnership or student exchange programme, will almost certainly give rise to other beneficial activities, including perhaps staff and researcher exchanges, new quality publications, joint teaching programmes (such as the Collaborative Online International Learning programme) as well as student recruitment.

The lack of mutuality is reflected in the UK’s new Turing scheme to encourage student mobility, which is just about outward mobility from the UK, whereas the Erasmus+ programme was two-way.

The UK strategy highlights a revenue target of £35 billion a year by 2030, but there is no investment allocated by the UK government towards its achievement, this in spite of the international market for students being very competitive, with more countries and their universities involved than ever.

Any business knows that to win market share in a highly competitive environment requires investment, in this case beyond that which individual universities can provide.

Another concern is that some of the country markets prioritised reflect political considerations rather than the operating environment for the higher education sector, for example, the downplaying of the importance of the European Union and China – in 2019-20 25% of international enrolments came from China (28% if Hong Kong is included) and 27% from the EU. Enrolments from both groups had been growing over recent years.


Australia’s highly promoted international education strategy was launched in 2016. As with the UK, its primary focus was on education export and revenue generation, mainly through recruiting and engaging large numbers of students – both to Australia and to Australian programmes delivered internationally.

Again, and similar to the UK, no investment was indicated and the universities were left, in the main, to their own devices to deliver on it.

Despite this and helped by relatively new and more student-friendly immigration policies, the Australian higher education sector has been successful and international enrolments have grown by 13% per annum over recent years to total over 440,000 in 2019. But now the dual combination of COVID and the plummeting political relationship with China has thrown things into a sharp reverse.

Targets were also proposed that over 100 million learners would be following Australian online and distance learning programmes by 2025. The programmes proposed included short practical courses as well as formally certificated programmes, coming from businesses, public and private vocational education and training providers, English language schools and higher education providers.

All indications are that this has fallen far short of the target to date. Indeed, offshore enrolments in higher education, totalling just over 100,000 in 2019, have shown little change.

A similar pattern to that of the UK is apparent in Australia, with scant mention of partnerships and reciprocity, no direct support and no accountability or practical delivery structure.

But Australia has benefited over the last few years from more accommodating employment policies for international students, allowing them to remain for longer periods and even take up longer-term work permits, including switching to other study programmes in order to become more employable in Australia.

There are some signals that the government and institutions in Australia are becoming aware of the vulnerability of their dependence on revenue from international students in the current uncertain global environment. Such realism might be an important lesson learned. Simply assuming, given the recovery after the 2008 financial crisis and the Asian crisis in the 1990s, that the market will recover is perhaps over-optimistic.


Canada has been the positive exception in recent years when it comes to the growth of international student numbers as well as its alignment of international education and immigration policies.

Although the pandemic has also placed international student mobility on hold in Canada, the government has maintained its immigration policy, including promoting access to employment after graduation, which is supported by strong welcoming messages to international students.

That policy is not without its challenges, such as lack of adequate capacity and services, too high a concentration on universities in the main cities and too much dependence on international student revenue, as the recent bankruptcy of Laurentian University in northern Ontario makes clear.

Local demographic declines, overly high aspirations for international student recruitment (a target of 1,000 in 2024 out of a total of 9,000 students) combined with the pandemic spelt the end of the institution. Its fate is very much a warning sign about what can happen if there is too much focus on international student revenue.

The United States

At the start of the pandemic, the prospects for inbound international student mobility were probably lowest out of the four countries for the US, given the unwelcoming environment created by the Trump administration through travel bans, the wall, concerns following George Floyd’s death, Optional Practical Training restrictions, geopolitical tensions with China and other factors.

The pandemic added to all this and basically put inbound mobility on hold and left many international and prospective international students stranded, either at home or in isolation in the US.

The election results and the shift by the Biden administration to withdraw the previous administration’s negative measures have created a more optimistic environment, although the impact is probably likely to be felt more in the medium or longer term than in the coming academic year.

This optimism is described by the presidents of New York University and Boston University in a contribution to Inside Higher Ed on 1 March: “Everything we need is in place now. We are here. We are ready. All the country has to do is replace the welcome mat and let the world know.”

That is too optimistic, though. Recovering from a major crisis is not that easy and particularly in the context of high-cost study, as in the US.

A newly published survey from IDP Connect says that 67% of international students interested in studying in the United States are planning to come, given the new welcoming attitude of the Biden administration. While this might be seen as a sign of optimism, it does also imply a 33% reduction – and experience teaches us that intention does not always lead to action.

Different approach to international recruitment

The recent report of the American Council on Education is more realistic. It warns of a gap between rhetoric and reality and of a shift from an unsustainable business model towards a more “sustainable, culturally responsive, networked, human-centred and equity-minded way of international student engagement”.

These are wise words, which university presidents in the country but also their colleagues in the UK and Australia, and even Canada, should listen carefully to.

An exclusive focus on revenue maximisation from international student recruitment is not only wrong from an ethical point of view, but the economic, social and academic risks are also too high.

In a Times Higher Education article, “Will international recruitment survive COVID-19?”, education professionals are also rather optimistic about recovery, but at the same time they give an important warning: “In the short term at least, anglophone universities will simply do whatever it takes to shore up their short-term finances. So much so, in fact, that they may, in the process, damage their longer-term prospects.”

Indeed, it might even be that in the coming two years there will be some surge as a result of deferred mobility and that might result in over-optimism. But there are many clouds hanging over the longer-term scenario: the economic crisis of the middle class in most source countries, ongoing geopolitical tensions, possible new pandemics and the impact of climate change, to mention just a few major concerns.

In the short term, which universities are best able to cope with a downturn?

Many research-intensive universities are less dependent on revenue from international students, given their significant research funding. It is more the universities at the next levels that are at greater risk, with less diversification of funding sources available to help overcome any revenue declines from international students.

Yet it is also these same universities that national governments (particularly in Australia and the UK) depend on to achieve their targets, requiring them to invest and manage risk without offering any support.

Hans de Wit is distinguished fellow of the Center for International Higher Education, and professor emeritus, Boston College, United States. E-mail: Dr Neil Kemp OBE is an independent consultant and researcher, and board member, Council for Education in the Commonwealth.