Never never land for university graduates

It’s often difficult to decide whether universities and the government are living in la la land1 given their level of disconnection with the realities of student life and graduate prospects.  What has become ever clear is that they are expecting students to live on the never never2 with a promotional message about the benefits of higher education based on magical thinking, pixie dust and a belief in fairies.  Around 44% of students starting in 2024/25 are expected never to repay their loans which is better than the 68% of the 2022/23 cohort but comes at a very high cost to many young people.

Nurses repaying more than £5,000 in four years but seeing their debt rise by  £20,000 due to interest rates and more than 150,000 with student loan debts over £100,000 are the tip of a very ugly iceberg that is likely to hole the credibility of higher education as a route to a better life below the waterline.  Having Plan 2 students paying 3% above RPI and wringing hands about the mental health impact of student debt and low-paid jobs for new graduates is a national disgrace.  Despite the warning signs and just like the Titanic there is no fundamental change of direction or speed which looks increasingly like negligence, arrogance or stupidity.

“All the world is made of faith, and trust, and pixie dust.”

For many years successive governments and the higher education sector have collaborated, some might say conspired, to sell a dream of higher wages, better jobs and more security to young people.  This is despite the government’s own statistics showing that the annual real median salaries of both undergraduates (down 11.7%) and postgraduates (down 16.9%) have been declining since 2007.  By comparison non-graduate salaries have decreased by 2.5% over the period.

Line graph showing annual real median salaries of the working age population (16-64 year olds) from 2007 to 2024, comparing Postgraduate, Graduate, and Non-graduate salaries.

In 2020, the Institute for Fiscal Studies estimated that “…around one in five undergraduates would have been better off financially had they not gone to university.”  In 2025, even David Willetts was obliged to note in a polemic arguing in favour of higher education “..there is no hiding from some uncomfortable findings”.  His grasp of current realities was probably best illustrated by his use of long Kingsley Amis quotes from 1960 (Encounter)3 and 1954 (Lucky Jim) at the start of his paper.

Another sign of the shifting tides is that in 2025 the rise in the National Minimum Wage to £25,500 makes it a higher sum than the salary for 10% of advertised graduate jobs.  The most recent changes to the student loan scheme (Plan 5) means that graduates on minimum wage are obliged to start paying their student loan.  When the minimum wage increases by 4% in April 2026 the overlap between graduate and non-graduate starter salaries and will only increase.

“Do you believe in fairies? If you believe, clap your hands!”

It is remarkable how often the sector trumpets research focused on current university students as a proxy for continuing demand in a university education in the future.  When you have started a course your propensity for post-purchase rationalization or choice-supportive bias is high.  The sunk-cost fallacy should also temper some of the wilder claims about belief in the value of higher education sector.

Perhaps of more interest is the YouGov report from mid-2025, which indicated that two-thirds of current students  thought “the standard of education and the wages graduates earn are not enough to warrant the cost of English/ Welsh university degrees”.  It’s a stark reminder that even if current students think they might get a better job or higher wages they are not willing to applaud universities as being value for money.  A third of these students didn’t expect to ever pay of their student loan but probably had little appreciation of the long term impact of everlasting monthly repayments on their future standard of living.

Even research after graduation showing high levels of belief in the importance of getting a degree indicates that 35% would have chosen “to do things differently” in terms of the course, location or other factors.  At the very least this suggests that advice ahead of taking a degree is inadequate.  With more than 700,000 university graduates out of work and many citing “health reasons” there are probably many graduates who are more sceptical about the value of their investment of time and effort.

More troubling for the sector may be that the tide of public opinion seems to be moving against them when it comes to value.  Research suggests that in 2018 only 18% of people did not consider university education worth the time and money but in 2024 this had grown to 31%.  It is particularly notable that the 25-34 age group in the survey had 48% saying university was not worth it.

“The moment you doubt whether you can fly, you cease for ever to be able to do it.”

For many years the argument was that graduates did better, lived longer and were happier than non-graduates.  It remains the stock in trade of the university pundits and mouthpieces who seem immune to the reality that past performance is no guarantee of future returns.  Their problem is that universities sit in a world where they talk to other universities and agree with each other.

Fortune magazine suggests that GenZ graduates in the UK are earning 30% less than millennials did.  In 2022 over 30% of graduates were in non-graduate work or unemployed after 15 months.   Another indicator is that the number of students beginning to repay their loans within two years of graduation has taken a significant fall, even amongst Russell Group graduates.

Over and above that new graduates are coming into a labour market which, on many counts, is more fraught and complex than for many years, and which some suggest may never recover.  In late 2025 graduate vacancies advertised were a third lower than the same time in 2024 with evidence that regional variations made this even worse for some new graduates.   Even if graduates can get a job the OECD suggests that four in ten are likely to be overqualified which is in the ballpark of Office for National Statistics research from 2019.

It is reasonable to reflect that the siren voices of higher education are keen to say that everything is in good order and that keeping a steady course is the right answer.  Universities UK say the country will “need more than 11 million extra graduates…to fill jobs in the UK by 2035”.  It is suggested that the report, “Jobs of the Future”, is based on analysis by Charlie Ball (of Jisc and Prospects) who appears to be a general source of upbeat news for those seeking it.

One claim in the report is that there will be a net increase of 10% “in jobs that require a degree over the next 20 years”.  It will be interesting to see how that plays against Morgan Stanley’s recent report indicating that the impact of AI is seeing UK firms cutting more jobs than are created at a faster rate than other major economies.  The suggestion is that young people and white-collar workers “are getting hit especially hard.”

Of course, it may be that only non-graduate jobs are being impacted by AI uptake.  It may be that there is an underlying growth in graduate level jobs that reflects the increase in the number of graduates available.  But, it may be that this an article of faith supporting sector led self-interest in recruiting new graduates.  If young people stop believing it’s a marketing story that will not fly.   

NOTES

  1. The phrase la la land appeared in print in 1925 and appears to have been a contraction of the French phrase “ooh-la-la”.  It was popularized in the 1970s as referring to the idiosyncracies of Los Angeles (LA) and its movie industry.
  2.  “Buying on the never never” was a phrase popularized in the UK in the 1960s and 1970s.  It reflected the growing use of hire purchase credit schemes to buy relatively expensive products like cars and household goods that could not be funded immediately from savings or wages.  For the suspicious, cautious and plain scared perjorative use of “the never never” was usually aimed at the aspirational middle-classes who were cast as living beyond their immediate means.
  3. The story of Encounter magazine is fascinating.  It emerged from a meeting of CIA and MI6 representatives in 1951 with much of the funding coming covertly from the Foreign Office and the CIA-managed Congress for Cultural Freedom.  Loss of that funding was a primary cause of its demise.

The sub-headings are all attributed to James M. Barrie, author of the playPeter Pan or, The Boy Who Would Not Grow Up that was first performed in 1904 and published in 1928.  The first Peter Pan film adaptation was a 1924 silent movie from Paramount Pictures.  Disney’s version of Peter Pan was released in February 1953.

Star Trek Lessons for Universities

“Captain’s log, star date 12026.7…”

Those trying to lead higher education to a brighter future should consider insights from the voyages of the Starship Enterprise.  Circumstances have, after all, forced them on a mission “..to explore strange new worlds, to seek out new life and new civilizations, to boldly go where no man has gone before.”  Star Trekkin’, a 1980s tune from The Firm1, is less profound but gives some useful headings and helpful direction.

There’s Klingons on the starboard bow

Whether its Klingons, Vidiians or Borgs – read intensifying competition, technological predation or switchback visa policies – it’s always good advice to understand the threat and accept it is not going away any time soon.

Captain Kirk once told the Klingon Chancellor, “Your father called the future, ‘The Undiscovered Country.’ People can be very frightened of change.”  For some in higher education that fear makes them cling to past glories and certainties or paralyses them from taking effective action.  The only answer is to accept that it gets tougher from here and nobody is going to bail them out.

The Vidiians harvested organs from others in order to survive.  Technology, from aggregators, to online delivery, to AI, will continue to undermine traditional models while “harvesting” sources of revenue, enrollment and academic standing.  These are realities that need facing rather than clinging to a mid-1900s model of higher education that is not going to be fit for purpose in the mid-2000s.

The weight of visa policies for international students are Borg-like in suggesting “resistance is futile”.  But griping about them, particularly where they reflect a Government’s intended response to public concerns, looks self-interested and out of touch.  Drawing inspiration from the character attributes of Captain Kirk – ingenuity, boldness, exceptional tactical thinking – is more likely to make your institution a better choice for those students that remain available.

Ye cannae change the laws of physics

Chief Engineer Scott said, “I can’t change the laws of physics” and higher education should accept that it is not able to withstand generational, demographic, economic and political realignment affecting the laws of supply and demand.  Physics is a good example because I was at the University of East Anglia when undergraduate physics was closed in the 1990s – it was expensive and didn’t recruit enough students to be viable.   For the record the university currently offers four undergraduate courses with Physics in the course title – times change.

Another thought-provoking quote from Scott is “the more they overthink the plumbing, the easier it is to stop up the drain.”  University leadership is full of very smart, if sometimes limited in experience, people who like to think they are playing three-dimensional chess when they should be focusing on not getting beaten at tic-tac-toe2. Brilliant implementation, fabulous service, clear differentiation and an explicable value proposition will always beat fifteen months of consultation spent developing a strategy that nobody reads let alone understands as offering a competitive advantage.

In short, stop travelling hopefully and wishing for what you can’t have.  

It’s worse than that he’s dead, Jim

As far as I can find Dr McCoy only ever said “He’s dead, Jim” but the import is the same.  It’s reported that at least 20 colleges in the US closed in 2024 with more than 40 closures since 2020.  The claim in the UK, where the proposed merger between the universities of Greenwich and Kent has recently been announced, is that half of the sector will post a deficit in 2026 and 50 providers may exit within three years.

The former seems small beer in the context of Clayton Christensen’s famous suggestion in 2017 that “50 percent of the 4,000 colleges and universities in the U.S. will be bankrupt in 10 to 15 years”.  Michael Horn’s update on the thinking from November 2024 is worth a visit for context and it is difficult to believe that the fundamentals will change, except for the worse, in the foreseeable future.  For institutions that rely on international student recruitment as a source of revenue the reckoning may come sooner.

The global context shows stresses in some other countries such as South Korea and Japan and it seems inevitable that ageing populations, constraints on international recruitment and declining returns on the cost of higher education study will continue to weigh on recruitment.  But the sector is not dead and university leaders should take Captain Kirk’s advice, “.. don’t let them do anything that takes you off the bridge of that ship, because while you’re there, you can make a difference.”  If you don’t think you can make a difference return to administrative duties at Star Fleet command, don’t pass go, don’t collect a golden goodbye payment or pension pay off3.

It’s life, Jim, but not as we know it

There is no return to a fondly remembered golden era where significant public investment, burgeoning youth populations and decision makers informed by their own degree fuelled career success, ensured higher education was a well-funded growth sector.  Almost every institution has to come to terms with straitened circumstances and find new ways of operating that might seem alien (sic).

Geopolitics have always created shifting patterns that require adaptation.  One big problem is that universities have not always shown themselves to be skilled at identifying and optimizing new opportunities or making good investments.  The boom in transnational education (TNE), for example, may turn out well but there are sure to be some bloody noses along the way.

The sector’s media is awash with happy talk about the potential of TNE but there are whispers about business models failing to take into account local taxes, problems with repatriating money, and difficulties delivery academic standards.  As Saskia Loer Hansen of RMIT noted there is “too much focus on making a quick buck” and that makes one wonder how near Damascene conversion of some university’s to seeking overseas campuses will survive full operational engagement.

University leaders might want to remind themselves of Spock’s line that, “After a time, you might find that having is not so pleasing, after all, as wanting.”   

We come in peace, shoot to kill

The sector must evolve rapidly but the size of individual institutions is tiny compared to the global forces they face, so working more closely together is often seen as a natural development. But studies of symbiotic relationships distinguish between mutualistic (both benefit), commensalistic (one benefits with the other unaffected) and parasitic (one benefits at the expense of the other). 

In many countries the “higher education sector” appears united but at a pinch point in the enrollment season better regarded universities will trawl for additional students without mercy at the expense of lesser institutions.  Governments often laud the quality of the country’s higher education system as a national asset and treasure while declining to provide any significant practical support for its future. 

The mix of autonomous institutions beholden to state restrictions mitigates against genuinely strategic realignment.  What tends to happen next is mutual recrimination and a haphazard decline in provision that impacts different subjects, areas of the country and parts of the population in markedly different ways.  UPP Foundation’s research reflects the way that “cold spots” in university provision can create a spiral of caution, low aspiration and resistance which exacerbates the decline.

Captain Kirk never said “we come in peace, shoot to kill” but it does reflect the doublethink of the ways university leadership is focused on institutional (sometimes personal) survival, reward and growth.  The phrase reflects how well-intentioned people who are used to bountiful times can become meaner and more close-minded when times are tough.   Spock’s comment, “The needs of the many outweigh the needs of the few” offers food for thought but I suspect that, “We will find hope in the impossible” is the way the sector is currently thinking.

Boldly going forward ’cause we can’t find reverse

This is really the clincher.  There is no choice but to go forward so higher education leaders have to, um, start leading.  In some cases there has been too much time, energy and resource spent on trying to turn back the tide of change rather than deciding what to do next.

Recent polling by Gallup suggests that globally people “..are marginally less optimistic for 2026” and that “economic pessimism is particularly pronounced in advanced economies, especially in Western and Eastern Europe.”  In some countries belief in the direction of higher education has been in decline for some time with increase numbers of voters declining to accept the glossy, self-seeking responses trumpeted by sector leaders. These are the new realities – less money and a need to restore public confidence.

Unlike Captain Kirk’s solution to overcoming the certainty of defeat in the Kobayashi Maru scenario there is no way to reprogramme the test overnight.  But it is reasonable for leadership to say “I don’t believe in a no-win scenario” as long as they start by accepting the realities.  Best wishes to all for all in 2026…..live long and prosper.

NOTES

  1. Star Trekkin’ is a 1987 song by The Firm which became number one in the UK for two weeks and the sub-headings are all lines from the lyrics. I would have liked to have used the lyrics of Spizzenergi’s 1979 song “Where’s Captain Kirk” but they didn’t work well enough. Watching Spizz (Kenneth Spiers) dodge bottles flung at him by fans of 999 suggests how nimble universities might have to be in the future!
  2. Noughts and crosses to English audiences but the point is that it’s a game you can’t lose if you play it correctly.
  3. This is a reference to the game Monopoly where you may draw a card that says “Go to jail. Go directly to jail. Do not pass go, do not collect $200. It reflects that some university leaders appear to have been rewarded for failure.

Image by Marcobaleno from Pixabay

A Pathway Through Open Doors

The IEE Open Doors Annual Data Release for 2024/25 is on 17 November but anyone interested in getting up to date on how Fall 2025 has gone can get plenty of insight from individual university websites.  Given the recent seismic changes in Canadian government policies the broader North America enrollment situation is also worth considering.

One lens is that of the pathway operators who have found life in Canada and the US increasingly tough going over recent years. Many have shifted emphasis to provide direct recruitment as a way of mitigating risks and optimising the use of their recruitment capabilities. It’s interesting to see what happens when both strands of revenue are challenged.  

Shorelight

The pathway operator with the largest exposure is Shorelight.  The company shifted its business substantially to an aggregator type, direct recruitment model around 2022 and currently claims access to 98 universities offering undergraduate study and 62 offering postgraduate study.  Within these groups there are 12 undergraduate and 10 postgraduate pathways offered (compared to 14 and 12, respectively, in 2022).

There isn’t a great deal of public information about the value of the company or its trading performance.  However, one indicator of the scale of problems facing the business comes from Huron Consulting, which has invested $40.9m in Shorelight since 2014.  Huron considered that investment to be worth, at “fair value”, $62.3m on December 31, 2024 but announced in its October 2025 filing, that it had reduced the value of the investment to $32.8m. 

It noted: “The total decrease in fair value of $29.6 million in the first nine months of 2025 was driven by a decrease in the projected cash flows of Shorelight, which reflects the current federal regulatory environment in which Shorelight operates.”

Even ignoring inflation the investment is considered to be worth less than it was a decade ago.  Huron continue to consider the investment “as an available-for-sale debt security.”  Whether there would be any buyers is a different question.

Navitas

The latest financial statement and report of Marron Holdings, parent company of Navitas,  covered the financial year ending 30 June 2025 and “..reflects the prevailing market conditions in Canada impacting future performance and cash flows..”.  With operational entities in Canada (as well as Queen’s College in New York) Navitas is impacted, as the report indicates, by “..declining student numbers due to government-imposed student caps and visa restrictions across our campuses.”  So, how bad is it?

One measure is that the University Partnerships North America (UPNA) “cash generating unit” of the Navitas operation saw an impairment charge of $134m on its $435m carrying valuation.  This presumes a “recoverable value” of $300m, if the business was sold, which might be considered optimistic in the current circumstances.

The Marron report suggests that there is an expectation of “a meaningful recovery in new student enrollments” in 2028.  The IRCC 2026-2028 Immigration Levels Plan suggest student visa targets will stabilize at around 150,000 in 2027 and 2028.  With PhD and Masters students enrolling at public institutions now exempted from the federal study permit caps from 2026 it is plausible that relief may come sooner.

However, the broader picture in Canada remains challenging and reputation can be hard to recover even at public university level.  Navitas partner Simon Fraser University’s reporting of Fall 2025 enrollment suggests continuing long-term decline at both undergraduate and postgraduate level.  The 2025 count is shown as incomplete but there is no reason to believe that the situation will improve much this year.

Bar chart displaying enrollment data at Simon Fraser University from Fall 2021 to Fall 2025, comparing undergraduate and graduate headcounts by visa type.

A further indication of the developing issues in North America is that the Navitas owned SAE Institute, which covers creative, media and IT education and has courses in several countries including five locations in the US, has also seen its enrollments decline.  An impairment charge of $52.5m to the Institute’s carrying value of $104.2m has been recognized.

INTO University Partnerships

The story of INTO’s changing fortunes in the US has been explored over a long period. After being a trail blazer for deeply embedded joint ventures it was first overtaken and then saw several partnerships fall away. One way of expressing the decline is that in 2019 the North America share of the company’s turnover was 41.6% (£37.3m) but by 2024 it was only 23.2% (£32.9m).

There now appear to be four genuine joint ventures from a stable that boasted 12 in 2018.  In recent months a senior US business development figure and a US operations VP have disappeared from the company’s website. Fall 2025 may signal another step backwards in the fortunes of its remaining pathway operations. 

The ten-year trend at Oregon State University (OSU) shows the long-term picture with Fall 2025 reporting indicating that the pathway venture has fallen back to COVID level enrollments.

Line graph showing student enrollment trends at INTO Oregon State University from 2015 to 2025, with categories for Academic English, General English, Graduate Pathways, OSU CAP, UG Pathways, and total enrollment.

A five-year analysis of the main countries of recruitment suggests a degree of volatility and continuing decline in several key markets.

Bar chart illustrating the main countries of student recruitment for INTO Oregon State University from 2021 to 2025, with data for Taiwan, China, Saudi Arabia, UAE, Japan, Kuwait, India, and South Korea.

Anybody thinking that a shift from Pathway to Direct Recruitment offers significant opportunities would be disappointed.  OSU’s own graph below shows the continuing decline and that international students as a percentage of total enrollment is, at 5.6%, below 2010 levels. 

Line graph depicting international student enrollment at a university from 2009 to 2025, showing trends for undergraduate and graduate students alongside total enrollment numbers.

The picture at INTO George Mason is similar and there have been unsubstantiated rumours that a change in the relationship is being discussed with possible announcements early in 2026.  Three years of declinging enrollment at the pathway centre might suggest a new approach is needed.   Time will tell.

Bar graph illustrating INTO George Mason University student enrollment from 2019 to 2025, showing undergraduate (blue), graduate (orange), and total (green) enrollment figures.

The situation at Drew University was highlighted in a recent blog and there is no Fall 2025 update to give further illumination.

The University of Alabama at Birmingham (UAB) joint venture shows some volatility over the past three years. The University’s reporting indicates that Fall 2024 was distorted by a class of 42 in Academic English compared to six and one in the years either side.  From 2023 to 2025 the INTO entity has seen enrollment decline by 58.4% (77 down to 32).

Bar chart displaying INTO University of Alabama Birmingham Fall Enrollment data for 2023 to 2025, with separate colors for undergraduate, graduate, and total enrollment.

At a UAB level enrollment of international students has also shown a sharp decline of 15% in Fall 2025 with graduate enrollment particularly hard hit.   

Bar chart showing the nonresident student enrollment at the University of Alabama Birmingham from 2021 to 2025, distinguished by undergraduate and graduate numbers.

The other issue for INTO is that its dispute with the University of South Florida continues to rumble on with a non-jury hearing has been scheduled for 6-24 April 2026.  A pre-trial conference is scheduled for 3 March 2026.  There have been a number of blogs covering developments along the way and one update is that in March 2025 the District Court of Appeal supported the Circuit Court’s decision on several issues in favour of USF Financing Corporation.

Readers of previous blogs will have seen that some of INTO’s financial claims against USF have been underpinned by expert opinion which reflected a robust view on growth in international enrollment and revenue in the US.  Given the performance of current partners reflected in the data above it will be interesting to see how that opinion is received in any hearing.

Top of the Ninth and Heading for the Eleventh?

Before the UK and Australia get too far ahead in congratulating themselves it’s worth reminding everyone that Yogi Berra famously said, “It ain’t over till it’s over.” And in international recruitment it’s never over.

The recent baseball World Series saw the Los Angeles Dodgers come back with a game tying home run in the ninth innings to tie before going on to win in the eleventh innings in the deciding game against the Toronto Blue Jays.  That was after the Blue Jays had come from behind against the Seattle Mariners to win the American League Championship.  Despite recent setbacks it remains entirely possible that both Canada and the US could be winning the international student world series home at some point in the next few years. 

The US is, under the right circumstances, the preferred destination of the brightest, the best and probably the largest number of international students.  There are continuing echoes of the H-1B visa discussion around the need for more highly skilled workers in the US and there are statements about the speeding of processes around green cards and visas.  Canada has shown that it can grow international numbers rapidly and it may be recalibrating to be able to offer a sustainable and attractive offer, including routes to citizenship, to international students.

Notes

As always the blog reflects my understanding of a range of data. Any authoritative comments or views with different interpretations are welcome.

Image by Brigitte Werner from Pixabay

Pathway Dancing in the Dark

Major changes in visa and immigration policy have shaken the world of international recruitment in the past 18 months.  Many universities have complained that even when the direction of policy is clear the detail and potential severity is uncertain.  For the major pathway operators whose business model is almost wholly based on international recruitment it’s like dancing in the dark in a room full of sharp edges.

This blog focuses on data provided by accounts filed by INTO University Partnerships (INTO) for its UK pathway operations which offer a consistent insight into enrollment numbers at each location over time.  Along with reasonable insights from its US partners these offer a good sense of how the world is treating international pathway operators in two major markets.  If time allows I’ll be having a deeper dive into other operators – there are some emerging signs of stress.

Dancing with Myself

INTO measures itself on five key metrics in its annual Accounts.  It’s appropriate for readers to familiarize themselves with what adjustments are being made to understand the full picture but at face value a six-year summary suggests only a slow recovery after the interruption of Covid. The cash figure (shown on a separate axis) suggests that operations are still needing support. 

Bar chart depicting the key performance indicators for INTO University Partnerships, showing adjusted turnover, adjusted EBITDA, net EBITDA, and underlying group profit from 2019 to 2024, with a separate axis illustrating cash figures.

INTO’s turnover by region reflects longer-term struggles in the US compared to the UK.  The single partnership in Australia, signed with G8 member the University of Western Australia in 2021, is showing early growth but is not a joint venture.  With the recently re-elected Labour Government in Australia expected to implement “..fee hikes and stricter processes”  and changes already implemented in 2024 “starting to slow” international student growth it is one to watch.

Bar chart illustrating INTO University Partnerships turnover by region from 2019 to 2024, showing data for the UK, North America, and Australia.

Source: INTO University Partnerships Company Accounts. (NB: Excludes statutory turnover and share of joint ventures’ turnover)

Quick Quick Slow in UK?

After the hurry-scurry to sign up partners up until around 2014 there has been a slow decline in the 50-50, deeply embedded joint venture model championed by INTO.  Several have closed – including at the universities of Gloucestershire, St Georges, Glasgow Caledonian as well as Newcastle London and UEA London – and INTO now has the controlling interesting in the INTO Newcastle University venture.  The situation at INTO City is more complex with both INTO and City University holding equal voting rights but the University only being entitled to 15% share of any profit.

All that being said, the UK-based ventures still reporting publicly in 2024 show that post pandemic recovery is slow and enrollments are well below the 2019 and 2020 numbers.  We know with reasonable certainty that UK universities have had a difficult international enrollment cycle in 2024/25 so there may not be much good news even with universities where direct enrollment is allowed.  Over and above that the Labour government does not appear to be letting up on dampening international student growth.   

Of the entities shown below INTO had outstanding, interest-bearing loans to INTO UEA, INTO Queen’s and INTO Stirling totalling £7.65m.  Until the 2021/2022 accounts INTO indicated these inter-company arrangements with joint ventures as them being either a debtor or creditor.  In 2018/19 the three were debtors to the tune of £3.97m. 

Bar graph showing the enrollments for INTO Ventures with UK universities from 2019 to 2024. Different colored bars represent data for each year.

Source: Joint Venture Accounts

It’s not all gloom and doom though.  INTO has two wholly owned pathway operations in the UK and the Manchester venue has boomed since 2021 while the London World Education Centre has returned to 2020 levels.  It will be interesting to see whether the Manchester operation is affected after losing Manchester Metropolitan University as a partner to Navitas ahead of recruitment for 2025/26.  Another one to wait and watch on is the 100% owned operation in collaboration with Lancaster University – it reported an operating loss of £2.6m in 2023/24 ahead of the “first main cohort” joining in September 2024.

Bar chart showing student enrollment numbers from 2019 to 2024 for INTO's wholly owned UK pathways, with data for INTO Manchester in blue and INTO WEC in orange.

Source: Company Accounts

Last Waltz in the US?

INTO burst onto the US scene with seven university partners and a US private equity partner investing £66m for a 25% stake between 2008 and 2015 but then found itself being surpassed as an operator by Shorelight.  INTO peaked with 12 partners in 2018 (although Hofstra has never been listed as a joint venture in INTO’s annual report) of which five pathways are now shuttered and two, at St Louis University and Suffolk University, have become wholly owned.  The pivot to direct recruitment sees 22 US options listed on its website compared to over 100 for Shorelight.

My blog reviewing enrollments in Fall 2024 at Oregon State University, St Louis University, George Mason University and University of Alabama – Birmingham, showed that only UAB was making any real headway on international student recruitment.  The four ventures all have interest bearing loans from INTO and these appear to have receded to pre-COVID levels. 

Bar chart illustrating US partner debtor/loan amounts for Oregon State University, Mason, Drew, UAB, and total from 2019 to 2024.

Source: INTO University Partnerships Financial Reports (NB: INTO’s classification of the year-end financial relationship with joint ventures changed in 2022/23 to show loans where previously the term debtors had been used.)

Since the blog noted above, I have been able to find enrollment data for Drew University whose joint venture partnership with INTO began in 2015.  After solid numbers above 100 from 2016 to 2020 there has been a steep decline in enrollments. 

Bar chart showing INTO Drew University enrollments from 2016 to 2024, with annual data indicating fluctuations in student numbers over the years.

Source: Drew University Consolidated Financial Report (students as at June of the year)

Casting a further shadow over the US operation is the litigation with the University of South Florida which has continued into a third year.  The bill “in respect of disputes” noted in INTO’s accounts has risen from £550k in 2021/22 to £2.1m in 2023/24.  It may not all be related to the USF case but this seems likely to be a major driver.

To outline the current state of the case is well beyond the scope of this blog.  Some features would be that both sides are currently arguing over the validity of the reports made by each other’s expert witnesses and one element of the case has been appealed to the District Court of Appeal of Florida, Second District (Case Number: 2D2025-0798).  As far as I have been able to follow, the trial remains set for August 2025 but there is a pre-trial conference in July and before that there is a meeting where one item is to “Discuss the possibility of settlement”.

My last major update on the case was in June 2024.  At that point the suggestion of $71.6m in damages being claimed in damages by INTO gave some sense of what was at stake.  It remains to be seen how this plays out.

Image by Colin Behrens from Pixabay

With Thought and Purity

Dundee is famous as the city of “jute, jame and journalism” but may have achieved notoriety after the near insolvency of its university and the very public bail out from public funds.  The Beano and Dandy were popular comics produced here but a leadership that seemed to act like Lord Snooty and his Pals ended up looking more like Desperate Dan and Roger the Dodger.  What is interesting is that Interim Vice Chancellor Professor Shane O’Neill is on the record as saying, “Reliance on international tuition fees is the main reason for Dundee’s financial crisis. It devastated our income.”

Perhaps that makes it unsurprising that pathway provider Oxford International Education Group appears to have taken the decision to excise details of the performance of its operation at the university in the accounts for the year to August 2024.  Parent company Sparrowhawk 2 Limited, which is a subsidiary of German private equity investor THI Holdings GmbH, is only too pleased to tell us that new partners, Edinburgh Napier University and University of Kent, launched in 2023/24 are “generating significant revenues”.  But then you dig a little deeper and you find that the reticence about performance of individual operations goes even deeper.

The 2023/24 annual accounts for embedded University Partnerships – Bradford International College, Greenwich International College, Bangor International College, Kent International College and Edinburgh Napier – have been similarly obfuscated. I have no doubt it is allowable but it’s really not very helpful and when people hide things they used to share it makes one wonder why.  The one remaining example of transparency – De Montfort University (LIPC) may give us a clue about the reasons.

Basically, the graph showing turnover suggests that 2022/23 saw an extraordinary surge in terms of recruitment with a very sharp correction then happening in 2023/24.  Any defender of the higher education sector surely has to query whether De Montfort University, the ultimate beneficiary of progressing students, was aware of and/or supportive of this growth? Even more importantly, did they build future expectations of similar numbers of progressing students into their financial forecasts?    

Source: LIPC Accounts

Meanwhile, at Dundee, there is a way of approximating what might have happened. I always hold any leads or comments confidentially but I am grateful to colleagues who raised the possibility.  It makes for a revealing picture. 

The March 2024 QAA Review Report of ICD (International College Dundee) tells us that enrollment rose gradually from 41 in 2017/18 to 152 in 2021/22.  Numbers then more than doubled to 318 in 2022/23.  At the time of the review the number enrolled was 70.  It seems likely that most, if not all, of the enrollment for the year was complete.

If that is correct, ICD was down around 150 students year on year.  This would have meant that a similar number were gone from the pipeline to the university and that ICD’s operating profit/loss may have been similar to 2019 (a loss of £281k).  I would, of course, be happy to be corrected on any of this by an authoritative source prepared to share and verify definitive numbers.

Source: QAA

With so many UK universities having pathway partners it seems possible that many institutions are not paying sufficient attention to the possibility of progression numbers being met.  Commercial pathway operators are likely to be at least as gung-ho as universities about their recruitment but if institutions are blithely building those numbers into revenue forecasts there is significant risk.  It seems unlikely that this risk will decline as the Government focuses ever more intently on student visas.

NOTES

  1. The City of Dundee’s motto is “Prudentia et Candore” which translates to “With thought and purity”.  Extraordinarily for a city of 148,000 people it has it has two professional football clubs Dundee United and Dundee Football Club.  United reached the final of the UEFA Cup in 1987.
  2. The Beano and The Dandy are almost impossible to describe to anyone who hasn’t seen them.  I can only recommend getting hold of some back copies and being appropriately delighted or appalled.
  3. As noted, I would be happy to have (in confidence) a discussion with anybody able to provide definitive alternative data on any issues raised. If there is a reasonable cause for correction I will carry it as an update in this blog.  

Image by Davie Bicker from Pixabay

Catastrophe or Correction for University Jobs?

As the clamour around redundancies in the higher education sector grows it is difficult to see where financial distress starts and misleading data ends.  In January this year Patrick Jack claimed in the Times Higher that in 2023/24, “..severance payments, which do not reflect the whole of the sector, affected about 10,300 employees – up from 7,300 the year before..”.  The implication is that there were nearly 17,500 job losses over two years with more to come in 2024/25.

The problem is that, if the sector’s returns to HESA are accurate, this claim is misleading.  While it is entirely possible that individuals will have taken severance as universities restructure there may have been many new jobs recreated.  A recent LinkedIn posting by Colin Bailey of Queen Mary University of London claimed 66 job vacancies with Queen Mary’s UCU branch countering that there are 59 redundancies possible at the institution. 

Looking over the longer term it seems clear that the sector has had an extraordinarily good run of adding headcount and that this has accelerated in recent years.  Several commentators, including me, have noted that recent growth in staff numbers has been fuelled by an unsustainable bonanza in international student income.  The party had to stop sometime.

The real problem for the UK is that in the absence of central control and the evidence of university mismanagement there is no guarantee that the sector is acting strategically.  It is quite possible that the wrong jobs are being lost in the wrong disciplines in the wrong geographical locations.  That is a good reason there should be no “one size fits all” financial bailout of the sector. 

A golden decade of growth in academic staff employed

HESA data shows a decade of additional academic jobs every year since 2014/15.  The growth in numbers employed over the last five reported years (23,405) has been even faster than the growth of the five years before (18,730).  In the last two reported years alone more than 12,000 academic staff were added.  

Source: HESA

* The cognoscenti will know that “atypical” academic staff are listed separately.  It is reasonable to note that from 2021/22 to 2023/24 the number of atypical staff fell by about 400 to 62,730.

Before anyone starts howling that the growth is driven by a fragmented, gig economy of fractional posts it’s worth considering that the FTE number show the same pattern.  From 2014/15 to 2018/19 an additional 13,515 FTE were added but from 2019/20 to 2023/24 a further 17,070 were added.  From 2012/22 to 2023/24 the total growth of 12,910 in total academic staff compared to FTE growth of 9,915.  The most recent year reported showed growth of nearly 10,000 FTE on the year before.

Source: HESA

So, if there was a net loss of 10,000 FTE academic jobs in the current round of redundancies employment levels would fall to about where they were in 2021/22.  That might make some sort of sense if the employment of academics was largely fuelled by growing numbers of international students.  But any job losses being publicized aren’t just about academic staff.

Let’s not forget the professional staff

The professional staff in universities, quite properly, don’t want to be overlooked so they must also be taken into the overall count.  Regrettably the numbers are harder to get at.  It is a well recorded disgrace that many universities took the opportunity to shield the growth in their non-academic staff numbers from HESA records at the first possible opportunity. 

The last full set in the HESA data is 2018/19 when 166 institutions recorded the detail of non-academic headcount with 222,885 staff.  By 2023/24 only 125 showed employment of non-academic staff.  The lack of transparency is very unhelpful in gaining public understanding or trust.

Evidence from individual institutions suggests that non-academic staff employment growth has at least kept pace with academic staff growth and in some cases has exceeded it.  But if we apply the same percentage growth rate as in academic staff from 2018/19 it is plausible that non-academic numbers grew by 13.8% from 222,885 to 253,643 by 2023/24.

Adding the estimated non-academic employment to the known academic numbers suggests that total employment in the UK higher education sector stood at around 500,000.  The number employed could well have grown by over 20,000 from 2021/22 to 2023/24.  In this context a reduction of 10,000 in the overall workforce seems more like a correction than a catastrophe.

Image by Gerd Altmann from Pixabay