intled – Page 11 – View From A Bridge – management, education and personal thoughts

Another Canadian University Pathway Coming Soon?

Pathway operators have been focused on getting contracts with universities in Canada for several years but there has been little real momentum. All the more interesting to catch rumours of Navitas nearing a breakthrough with Ryerson University. It’s worth having a look at whether there’s any strength to them.

Exhibit one would be the university’s Senate Meeting Agenda of 1 October 2019. Pages 78 to 83 have a summary of meetings ‘from the President’s Calendar’ and there, hiding in plain sight on page 82, is the entry:

Jul 29, 2019: Over dinner, I met with Rod Jones, group CEO for Navitas worldwide; Scott Jones, nonexecutive chair of the board for Navitas worldwide; and Brian Stevenson, president and CEO, university partnerships, Navitas North America. We discussed the potential for Ryerson to bring in international students through the pathways to university education that Navitas offers.

The information had previously been shared at the Board of Governors meeting on September 20, 2019. So we know that Ryerson’s President Mohamed Lachemi has been meeting with senior people from Navitas although that might not be considered unusual. But there’s a little bit more to report.

Recent social media shows President Lachemi escaping the Canadian winter in the past couple of weeks and ‘expanding Ryerson’s relationships with leading universities’ in Australia. This might be unexceptional but the twittersphere also suggests visits to Griffith College and Deakin College – two Navitas centers – arranged by Navitas. And it sounds like there have been more meetings with senior Navitas folk.

There’s no way of confirming the market gossip and I am always happy to clarify the situation if an authoritative source gets in touch. Ryerson has certainly been in conversation with at least one external operator in the past but given the rise of Canada as an international student recruitment magnet it’s questionable what benefits such a relationship brings. Some commentators might argue they could organize themselves to take advantage of the momentum behind enrollments.

Once clue might be that Ryerson looks to have been left lagging despite the surge in interest for the country with the world’s longest bi-national land border. There are thirty Canadian universities listed in the THE 2020 World Ranking top 1000 and the percentage of international students at Ryerson is the lowest of all. At 4% it is well behind other, admittedly higher ranked, Toronto institutions like the University of Toronto (21%) and York University (24%).

Ryerson’s global ranking in the THE ranking 601-800 bracket places it behind the other Navitas partners in Canada. The University of Manitoba is ranked in the 351-400 bracket and has 17% international students and Simon Fraser University is in the 251-300 bracket with 30% international students. This might suggest that there is plenty of scope for Ryerson to grow with the right sort of support.

It would be the third public research university to partner with Navitas and would give the portfolio added depth. The only other pathway provider with representation in Canada is Study Group who have one public research university in Royal Roads and two sub-degree colleges in Stenberg and the Center for Arts and Technology.

With US enrollments still struggling and the maturity of the UK and Australian pathway markets it’s easy to see why there is interest in Canada. Interest remains strong amongst students and agents with little sign of applications slowing. But everyone with a history in international recruitment knows that past performance is no guarantee of future success.

The international student boom in Canada has come with some issues that are increasingly grabbing the headlines. There are allegations of students being ‘duped by unscrupulous agents’, scarcity of part-time work and up to 39% of study visa applications being rejected. It’s difficult to believe that interest will slump quickly or precipitously but it may be time for wise heads to consider what a sustainable rate of growth might look like.

Image by David Peterson from Pixabay

UK’s International Graduate Employability ‘Promise’ – Next Steps

It should be possible to wholeheartedly welcome UUKi’s Conference ‘International graduate employability: Making good on the promise’ because it is an important topic. But I doubt we will see 90% of the time devoted to employability for students leaving the UK after study, although that’s the percentage that will probably look for jobs in their home country. Neither is the Conference likely to have the necessary quality of data about graduate outcomes and views despite the investment made in UUKi’s International Graduate Outcomes 2019 publication.

Even more discouragingly, the publicity for the event majors on the point that ‘we have the post study work visa we have argued for for so long’. This encourages those who want to focus on short-term enrollment growth by maximising the post-study work windfall rather than serving the broader international graduate community. A more balanced view would reflect that providing careers services, alumni relations and employer networks suited to international students returning home will be a key point of strategic differentiation in the long term.

In addition to getting the balance of time in the Conference right it would be good to see discussion and commitments on how to make progress in four key areas:

Make Sure Data Reflects Reality

Several assertions in the International Graduate Outcomes 2019 report are heavily caveated and require detailed explanation in a footnote or the annexes. The most egregious is the claim that “The balance of respondents to the i-GO survey by nationality was broadly similar to that of international students studying in the UK.” (page 17). With only 6% of the total respondents from China this is nonsense and, as a footnote confirms, “in the year 17-18, Chinese students made up 33% of the total non-EU student population…”.

Assertions on comparative salaries (page 49) for UK graduates working in other countries are problematic and confusing. For the diligent reader these anomalies are explained away but the headline claims seem to be a naïve overstatement of the benefits based on data that is not comparable and in some cases is very limited. If this begins to work its way into university marketing materials we are likely to see the Advertising Standards Authority called into action again to correct misleading claims.

Other sources and methodologies, which have more substantial samples and better reflect the nationality mix of UK-enrolled international students, are available. They also offer the potential to compare performance across competitor countries and give substance to claims about the pay premium that returning students can expect. Individual universities are already buying these services but the competitive future of UK HE seems worth a sector-wide approach.

Get Serious About Careers Service and Advice

In the foreword to UUKi’s report Chris Skidmore Minister of State of Universities, Science, Research and Innovation comments, “Together we can build on this research to help ensure that international students who graduate from the UK’s world leading universities are in the best possible position to go on to further employment be it in the UK, or their home nation”. The latter will be difficult if not impossible if there is no concerted effort to build relevant support and services for international students.

The report highlights that only 2% of international students found jobs through their University Careers Service. It is arguable that few of those Services are equipped technically, with funding or with genuine insights, to help international students engage with employers in their home countries. Whatever the reason, it is a dismal outcome and an indictment of the services international students receive for their fees.

Pay More Attention to International Alumni Relationships

Details on response rates are not wholly clarified but the Report stated it was, “… less than 1% of total international graduates from UK higher education institutions” during the sample period. It seems plausible that those who did respond are outliers in the alumni community who feel particular affinity or allegiance to their institution and/or the UK. If so, it is dangerous to assume that high levels of approval and support for the educational experience are commonplace.

Most service organisations are more interested in finding out about customers who are dissatisfied so that they can improve their offering. Lack of engagement means that institutions may be getting highly selective feedback and missing information that could help them build more effective curricula and better support. Even if the responses are representative and the low rate just the result of inertia, it means universities are missing opportunities to develop networks of graduates around the world who may be supportive of future students seeking employment.

Target Connections with Employers Through Better Data, Insight and Graduate Support

HEIs should know the destinations of international graduates and develop targeting to match graduates with relevant skills to employers who need them. The importance of this is apparent in markets such as Malaysia where students ranked nine Asia-Pacific regional companies as the most desirable employers in their top ten for business and commerce according to Universum 2017. In terms of graduate employability many Asia-Pacific based corporations would also benefit from universities providing better information about courses and the strengths of their students.

There are major opportunities for universities that are able to fit together the jigsaw of graduates and employers. Better employment prospects and evidence of thriving careers is a siren call for both potential students and major organisations who are seeing job-prepared employees from favoured institutions. The best way to achieve that level of synchronicity is through data that is individualized to each university delivered with insights about regional economies.

A Strategic Advantage and Virtuous Circle

I would like to give three cheers to the UUKi for staging a Conference on an important issue and their effort to develop a worthwhile piece of evidence that underscores the UK’s position as a high-quality study destination that delivers enhanced career and life prospects. For now, I can only manage one-and-a-half because the Report errs on the side of marketing at the expense of more hard-edged insights, and the Conference may simply reinforce short-term, narrow thinking about finding jobs for students who stay in the UK.

More positively, both are good starting points which, with imagination, conviction and investment, could become the basis for a genuine strategic advantage. This would mean investment in demonstrating through data and insights that the UK produces a global network of alumni with thriving careers. With graduates choosing to work overseas getting appropriate support as they start their working lives, businesses around the world would better understand the value of a UK higher education, and international students would choose the UK knowing it gives them an employment advantage. It’s a virtuous circle worth considering.

Image by Gerd Altmann from Pixabay

More US Pathway Cutbacks

Keeping pace of the developing pathway scene among the private providers in the US requires constant attention. Study Group has taken action within its US portfolio and no longer recruits for four brands featured on the company’s website a few months ago. After this year’s closure of CEG’s US centers and EC Higher Education’s withdrawal from the market it’s further evidence of the pressure on international student recruitment.

The closed Study Group pathways are Roosevelt, Widener and Merrimack while West Virginia was a direct recruitment option. The Merrimack relationship extended back over a decade, Widener and Roosevelt were opened in 2012/13. West Virginia came online in January 2018 with recruitment commencing in fall 2018.

These changes leave Study Group with four regionally-ranked and seven nationally-ranked university partners according to USNWR 2020 listings. Among the nationally-ranked, two were taken over from EC while only three sit above 200: Baylor (79), Vermont (121) and DePaul (125). Three of the four remaining regionally ranked universities, Oglethorpe, Western Washington and Lynn were signed in 2017, so there may be contractual impediments to early action.

US News Ranking 2020 of Study Group US Partnerships (closed institution in red)

The Study Group closures mean that, as far as I can track from public information, the company has launched 14 university partnerships in the US of which five have now been closed in the past two years. Between CEG and Study Group more than 10% of US private-pathway provider centers have closed in the past two years. These tended to be smaller operations in terms of student numbers, but it reflects the stress that the sector is under.

As global competition grows, the potential for private pathway providers to recruit successfully to less prestigious and/or lower ranked institutions seems increasingly questionable and even bigger names have seen enrolments declining. It is difficult to see that the increasing view of Admissions Directors from Masters/Baccalaureate institutions that pathways ‘will become more important’ is well founded. Neither is it obvious that the billion dollar private equity fuelled dash to build pathway capacity in the US is going to pay off in the foreseeable future.

With UK international recruitment prospects resurgent under a new Post-Study Work regime, the growing quality of emerging options around the world and the continuing assertiveness of Canada, Australia and Germany, it’s probably time for a rethink.

Image by Gerd Altmann from Pixabay

PSW – The Morning After

There’s plenty of jubilation over the re-introduction of two-year Post-Study Work visas and congratulations are due to those who lobbied for it. But it’s worth remembering that Government’s rarely give something without wanting something in return and that every gift horse should be given careful scrutiny. In that context there are a few things to look out for over the coming weeks, months and years.

Drift, Detail and Design

A ‘popular’ announcement from a Government under pressure is often rushed out with detail and other policy intent still needing to be tidied up. The Home Secretary’s announcement that the new Graduate Route ‘will mean talented international students, whether in science and maths or technology and engineering, can study in the UK…’ was curious in the context of a scheme allowing all graduates to stay. It’s mirrored on the Home Office website and may provide cover for a later tightening of the rules to specific subjects.

A Step Forward But…

Some details of PSW are still to be announced but it seems slightly short of the Australian (two to four years) and Canadian (up to three years) schemes. It is not yet clear if families can join the PSW graduate as in Australia and it seems doubtful that there will be any room for promoting it as a route to permanent residence as Canadian institutions do. And there is always the potential for both those countries to step up their offer to become even more competitive.

Economic Conditions Can Change Policy

PSW was last introduced in the UK in 2002 when unemployment was 5%. It’s discontinuation in 2012 followed a rapid rise in unemployment to 8% between 2009 and 2011. Prime Minister David Cameron told the House of Commons, ‘Frankly, there are lots of people in our country desperate for jobs. We don’t need the brightest and best of students to come here and then do menial jobs.’

The economic direction of travel for the UK post-Brexit is uncertain but universities have been drawn very directly into discussions about employability and the value of a degree. It’s easy to allow PSW in an era of historically low unemployment, currently around 4%, but if recession hits and unemployment climbs it is equally simple to remove it. Trends in numbers and careers of home graduates may factor in that equation.

Table 1 – UK Unemployment 2000-2013

Grounds for Home Student Fee Reduction

The HE sector made an enormous song and dance about the contribution of international student fees but may find being granted it has unintended consequences. With increasing international students providing a major economic stimulus to universities there is fertile ground for populist and electioneering proposals to cut fees for home students and increase investment in school and FE. It’s probably helpful that international students also prop up the economics of many STEM courses and postgraduate study.

Limiting HE Investment to Support Other Priorities

Universities may hope the Augar Review has been buried but newspaper headlines about ‘low value’ courses, universities manipulating applications, grade inflation and VC pay are unlikely to have been totally forgotten. More importantly, more money from international students gives grounds to support more popular or political priorities. It was interesting to see Chancellor Sajid ‘I went to my local FE College’ Javid, Spending Round announcement include an increase for further education funding in the 2019 spending round and increasing ‘school spending by £7.1 billion by 2022-23, compared to this year.’

International Fees For EU Students

One of the arguments against introducing international fees for EU students post-Brexit has been that it will cause a significant decline in their numbers. A surge in traditional international fee-paying students attracted by PSW makes up those numbers and would allow EU students to work as PSW international students without a more complex arrangement with Europe. Making EU students ineligible for UK student loans would also eliminate headlines like ‘Thousands of EU students fail to repay loans.’

Never Mind the Quality Feel the Width

It is arguable that strong brands perceived as high quality or with potent strategies for recruitment have not been particularly troubled by the lack of post study work visas. Eight Russell Group universities each increased their first-year international student intakes by over 27% over the two years from 2015/16 to 2017/18. Even beyond that Group there are clear winners who achieved significant growth including De Montfort (+78%) and the University of East London (+90.6%).

For some universities these were grim years with five institutions each seeing their intake decline by over 300 students. PSW is likely to see such institutions making up for lost time and revenue by driving international numbers up but the quality of the intake may suffer. PSW as the driver for attracting less able international students to cash-strapped universities is not a particularly lofty ideal.

Competition for Places and Jobs

The potential for significant upturns in volumes of international students comes just as the upswing occurs in home student demographics with HEPI suggesting the need for up to 300,000 additional university places by 2030. This sets the scene for potential conflict between home students and international students – particularly if home fees go down and institutions are looking towards the economics. The OECD’s Education at A Glance 2019 noted, ‘there is a risk of squeezing out qualified national students from domestic tertiary educational institutions that differentiate tuition fees by student origin, as they may tend to give preference to international students who generate higher revenues through higher tuition fees”.

It’s suggested that in 2019 around 1,000 places were reserved for international students in Clearing and the economics may push institutions to favouring international students over home students just as home demand steps up. It is only a short step to stories about debt-laden home graduates being unemployed because universities are enticing increasing amounts of international competition for early career jobs. At that point the freedom of PSW may find itself subject to increasing scrutiny and Government intervention.

Conclusion

A benevolent PSW policy is to be welcomed where it builds on the reputation of the sector for quality and is part of a strategic approach to supporting higher education’s potential as a major contributor to global influence as well as the UK’s economic and cultural development. It is also possible that the recent announcement was carefully planned and is the start of a period of unprecedented benevolence towards higher education in the UK. But history and context suggest that things are rarely so simple.

Image by Gerd Altmann from Pixabay

More Pathway Jeopardy

INTO’s joint venture with the University of Gloucestershire is under ‘strategic review’ with the possibility of closure. INTO is no longer accepting applications to start at the on-campus centre in 2019, which is understandable given the uncertainty but seems unlikely to improve future prospects. It is anticipated that the review will be complete in early July.

A number of ‘third party’ pathway centres in the UK and US have closed in recent years, including Navitas at Edinburgh Napier and Oxford International at the universities of Canterbury Christ Church and Bedfordshire. In the US four CEG OnCampus pathways are closing, and EC’s higher education business has shut down with partners moving to Study Group. INTO Gloucestershire offers some insights into the dynamics at play in the joint-venture model.

The centre opened in 2013 but has struggled to build enrolments or achieve operating profitability. The most recent published figures show average enrolments falling for two years and lower in 2017/18 than 2014/15. The University’s Financial Statements for 2017/18 noted ‘the highly challenging market’ and it seems unlikely that 2018/19 enrolments were much, if any, better.

Table 1 – INTO Gloucestershire Average Enrolments

Source: INTO Gloucestershire LLP Annual Reports

The University’s most recent Financial Statement concluded that the ‘financial performance of the JV entity combined with the net revenues from progressing students, continues to deliver a worthwhile partnership arrangement for the university which enhances the internationalisation agenda.’ With the UK likely to be heading for a good enrolment year this might seem to be a good moment to double down on the investment after weathering some difficult years. There’s also the possibility of even better times ahead if proposed changes to post-study work opportunities become reality.

But as the joint venture enrolments have slipped first year, full-time international enrolments have also stalled for the University. Published data doesn’t provide insights into progression from the joint venture but as UK universities have become more competitive for international students it’s possible that more are leaking away to better ranked or more favourably located institutions.

Table 2 – University of Gloucestershire Non-UK Enrolments with JV Enrolment Overlay

Source: HESA Data and INTO Gloucestershire LLP Annual Reports

A closer look at the financial story also suggests some reasons for caution on all sides. Recent Financial Statements show the University has written off £2.8m of debt from the joint venture over two years with INTO University Partnerships (IUP) writing off £3.8m of debt in the same period. Current financial year data is not available but the debtor balance owed by the joint venture to IUP at the end of 2017/18 was £1.77m.

Table 3 – INTO Gloucestershire LLP Debtor Balance to IUP and Written Off Amount

Source: INTO University Partnerships Annual Reports

The joint venture has been unable to operate profitably in its first five years of operation despite measures to make ‘changes to the model of paying for services supplied by the two respective parent organisations’. One ratio for pathway watchers to consider is that the joint venture’s cost of sales rose from 73% in the peak enrolment year of 2015/16 to 87% by 2017/18. Significant reductions in operating expenses have been unable to make up for the resulting decline in gross profit, but are likely to have reduced revenue to the partners for services they provide to the joint venture.

Table 4 – INTO Gloucestershire Turnover, Cost of Sales, Operating Expenses and Operating Profit

Note: Operating loss shown excludes exceptional items and interest Source: INTO Gloucestershire LLP Annual Reports

A university statement indicates that the strategic view was initiated jointly. Increasing levels of indebtedness, less revenue from the centre paying for services and little prospect of a significant shift in the ability to recruit students would certainly concentrate the mind. As the joint venture’s Annual Report notes – ‘the principal risk facing the LLP is the continued under-recruitment of students to its programmes.’.

The university have confirmed that ‘no decisions have been made’ and that ‘no compulsory redundancy notices have been issued to staff either employed by the JV, or employed by the University outside of the JV, as part of this process’ and it is to be hoped that INTO and the University of Gloucestershire can find a sustainable way forward . But if not, it would follow INTO University of East Anglia London and INTO St George’s University as the third of the company’s joint ventures to close. That would leave eight joint ventures and two wholly owned operations remaining in the UK.

Most pathway portfolios have partnerships that struggle to recruit and are likely to come under the microscope when times get tougher or business models are disrupted. That’s why there is likely to be more realignment, restructuring and portfolio shuffling as the sector matures. I once heard an industry leader comment that the trough between launch and profitability is becoming deeper and longer – the question is whether some vessels are too leaky to make it to the other side.

Image by Arek Socha from Pixabay

SEVIS With A Smile? Or ‘A Delusion, A Mockery And A Snare’?

Data-driven predictions of future international student enrollments can be very useful for international recruiters, university budgeting and potential investors in higher education. Recent commentary using Student and Exchange Visitor Information System (SEVIS) data shows how visa data can be characterized in a way that suggests the challenges faced by US higher education are overstated. But clarity around what this data source includes and where it might exaggerate or diminish trends is vital to avoid misdirection and poor decision making.

The increasingly user-friendly ‘SEVIS By the Numbers’ web-site provides good access to visa data complete with interactive maps and is a popular source. It claims it ‘illustrates trends and information on international students studying in the United States’ but it does not disaggregate between those enrolled at universities and those on student visas taking the Optional Practical Training (OPT) extension which allows for post-study work. Confusing or conflating the two is unhelpful in understanding the implications for the state of US higher education.

Executive action in 2016 increased the maximum length of employment under OPT for foreign students with STEM degrees to 36 months, which, along with a booming US economy, resulted in a material increase in the number of STEM graduates staying on to work in the US. While these students hold F-1 visas (and are reported in the SEVIS numbers), they are not tuition-paying students enrolled in a US university.

To give a sense of materiality of the OPT numbers, the Institute of International Education (IIE) Open Doors Report reports shows that the proportion of OPT students rose to 18.6% of ‘total international students’ in 2017/18 from 12.4% in 2014/15. When the IIE announced that the ‘number of international students’ increased to reach a new high of 1,094,000 in 2017/18, the growth in OPT numbers masked the reality that students enrolled in full-time study in US universities actually declined year-on-year and were lower than 2015/16.

Source: Institute of International Education, 2018, https://www.iie.org/opendoors

A better guide to the health and future of international student recruitment may be provided by IIE’s data which shows that both undergraduate and postgraduate new enrollments have fallen for two years in a row, and non-degree enrollments for three. Critically, between 2015/16 and 2017/18 the number of undergraduates and graduates enrolled fell by over 17,000 while the number of non-degree students fell by less than 5,000. While percentage falls in non-degree students can look high, the number of students is relatively low compared to the main body of academic students.

Master’s Level Enrollments and Students From India

Thinking of SEVIS data as a proxy for enrollments is particularly distorting at Master’s level and for understanding trends for students from India. SEVIS suggests that the number of Master’s ‘students’ grew by 27.7% between 2014 and 2017 while IIE data indicates that numbers actually enrolled in universities grew by only 8.4%. The difference is driven by the 69.1% increase in OPT numbers (83,175) shown in IIE data over the four years.

Source:
Institute of International Education, 2018, https://www.iie.org/opendoors and SEVIS data from INTO Corporate Blog

Note: The SEVIS data and the IIE Enrollment data is not synchronous.

The Pew Research Centre has reported that students from India are significantly more likely to utilise the OPT opportunity than other international students. IIE’s breakdown indicates that between 2016/17 and 2017/18 the number of students from India enrolled on Graduate programmes declined by nearly 10,000 while the numbers doing OPT increased by over 18,000. The increase in numbers doing OPT appears to be slowing which is likely to reflect emerging options around the world and the declining competitiveness of the US in retaining international talent.

At undergraduate level, which is unaffected by OPT, IIE and SEVIS both show a small growth in students from India year-on-year to 2017/18 but this should be seen in the context of growth in Canada which had 123,000 students from India in 2017 – 63% more than the year before. This was largely driven by an increase of 67% (86,900) going into colleges, presumably as a result of the opportunities for progression to university, work and citizenship. It will be interesting to see how far growth in Indian undergraduates in the US goes when these routes seem more straightforward and available in Canada.

The 1st Baron Denman coined the phrase ‘a delusion, a mockery and a snare’ in a legal context in the 1840s, and imprecise use or understanding of data has a similar potential to lure, deceive and trap the unwary. No source of information is without flaws and weaknesses but it is also foolhardy to take one source, view or instance as giving definitive guidance. In that respect there is plenty of evidence that competitors are challenging the US, that global student mobility is changing, that demographics are shifting and that technology is disrupting the established order.

Image by Gerd Altmann from Pixabay

More Pathway Recruitment Indicators

Detailed, consistent and up to date insights into pathway recruitment performance are often difficult to find. Some US universities give good data at a granular level and I reported on some of these in a recent blog. The completion of the reporting cycle for INTO’s Joint Ventures and wholly owned centres in the UK gives a comprehensive picture of their enrolments in the 2017/18 financial year.

For the ten entities – eight joint ventures and two wholly owned centres – that have been trading five years, total enrollments bounced back from the low point in 2016/17 but remain short of 2013/14 levels. This suggests that it’s probably still pretty tough going for the UK pathway market.

Table 1 – Average Enrolments for INTO Centres 2013/14 to 2017/18

Source: Annual Reports

At a detailed level the drivers of growth were Newcastle and City which bounced back after several years of decline and Queen’s. Long-term partners East Anglia seem to have bottomed out after three years of decline. Neither Stirling or Gloucestershire, the most recent partners in this group, have got over the 200 student mark after five years.

Table 2 – INTO UK Centres Average Enrolments 2013/14 to 2017/18

INTO centres split educational oversight between ISI and the Quality Assurance Agency with the former giving specific details on numbers enrolled and the latter being less prescriptive. While the annual reports noted above are averages across the financial year (August to July) in question, the ISI education oversight into three centres gives deeper insight into the most recent autumn intakes.

The distinction between EFL and FE used in the ISI reports broadly distinguishes between students on English Language only or Academic courses. Newcastle appears to have a significant number doing both.

Table 3 – Student Population of three INTO centres – November 2018

*Source: ISI Educational Oversight Reports*

The other INTO Joint Venture is Newcastle University London which had an inaugural intake in 2015 and offers both pathway and degree courses. At the time of launch the university indicated that ‘…..in collaboration with INTO, our London campus is expected to grow to 1,200 students’. Three years in the average numbers for 2017/18 were 381.

Recent UK pathway activity from established providers has largely centred on adding well ranked partners with Study Group, Navitas and Kaplan gaining Aberdeen, Leicester and Essex respectively. Newer players have generally picked up less well-known names with Oxford International adding Greenwich and QA HE with Southampton Solent. With the UK Government launching its new strategy for international student recruitment it remains to be seen if the cake will grow for everyone or if the strong will dominate.

NOTE: Table 2 updated 16 June 2019 to include INTO Glasgow Caledonian University 2017/18 enrolment

US INTERNATIONAL STUDENT ENROLLMENTS – PEER TO PEER AND PATHWAYS

Making sense of trends in US international enrollments presents real challenges due to the diversity among ~4,000 institutions. Looking at Oregon State University’s self-identified peer group of four other public universities is an opportunity to get under the surface. It also provides insights as to how private providers offering pathways and direct recruitment support to universities, are contributing to overall numbers and adjusting their programs in an increasingly crowded market.

It’s a small sample over a limited time but it may offer some pointers for universities considering how best to meet their recruitment needs*. Over a four-year period to fall 2018, one of the two public universities without private provider support was competitive in terms of overall international student enrollment. Where a new peer institution was added to the provider’s portfolio during the period it did better than longer-term partners.

Some universities have benefited significantly from partnering with a private provider to bring global recruitment expertise to both pathway and direct enrollment. But some have been less successful and new dynamics are emerging as the sector matures, competition increases and student numbers fall. Where a private provider services several universities with similar academic and ranking characteristics the potential for internal competition for students is likely to increase.

For the university this makes the task of selecting a provider more complex and the consideration of tighter commercial terms on target numbers and non-competing partnerships worth close attention. The lure of having a partner who offers to take all the up-front costs while returning more international students than the university currently has will always be attractive. But the prospect of signing a long-term contract to become a commodity product in an undifferentiated portfolio is less so.

A MIXED PICTURE IN TOTAL INTERNATINAL ENROLLMENTS AMONGST THE ‘ORANGE PEERS’

Oregon State University (Oregon State) defined four institutions as “Orange Peers” for the purposes of its Strategic Plan . Two, Colorado State University (Colorado State) and Washington State University (Washington State) are, like Oregon State, partnered with INTO University Partnerships. The others, University of Nebraska (Nebraska) and Oklahoma State University (Oklahoma State) do not have any private-provider pathway relationship.

A working assumptions of most private pathway provider relationships is that the university will benefit from students progressing from the pathway as well as direct applications as the institutions international profile is raised. Providers have also increasingly focused on recruiting students directly to the university i.e. not just through a pathway, with remuneration often coming as a percentage of tuition fees paid by the student. Looking at an institution’s total international enrollments is one way of considering how the partnership is delivering.

The four-year picture in Table 1 broadly reflects the overall slowing in the US since 2015. However, Washington State had year-over-year growth of 66 students and 46 in 2017 and 2018 respectively, which may reflect the early growth stage of the partnership with INTO which commenced in 2017. Both Oregon State and Colorado State, long term INTO partners from 2009 and 2012, respectively, saw overall enrollments decline in 2018.

Nebraska, which has no private-provider support had the strongest growth over the four years, increasing by 283 students or 11.2%, despite a dip between 2017 and 2018. Oklahoma State fared significantly worst with a fall of 236 students.

The IIE Open Doors report shows that between 2015 and 2017 (the latest comprehensive reporting available) US total international enrollments fell by 0.56%. All of the ‘Orange Peers’, except Oklahoma State, out-performed on that timescale. It will be interesting to see how 2017 to 2018 enrollments compare against the national trend.

TABLE 1 – ‘Orange Peers’ – Total International Enrollments Fall 2015 to Fall 2018

PATHWAY PROGRAMS REFLECT CHANGING CIRCUMSTANCES

Pathway enrollments help underpin direct recruitment to university programs. As global markets change in terms of major sending countries and the demands of students they need to operate flexibly to maintain relevance. As the number of pathways in the US has grown competition for students has intensified.

In June 2018 Inside Higher Education’s Elizabeth Redden took a deep dive into pathway performance as US international enrollments came under pressure. She noted, in particular, a steep decline in pathway numbers at Oregon State driven largely by falling numbers of Academic English students. Fall 2018 data shows that this has continued along with a decline in both Graduate and Undergraduate pathway numbers.

TABLE 2 – INTO Oregon State University Enrollments – Fall 2015 to Fall 2018

Source: Oregon State University Institutional Research

At Colorado State one response to the changing market conditions has been a notable increase in the number of pathway courses and the range of academic disciplines covered. In fall 2015 six pathway programs secured 152 students, an increase to 14 programs in 2017 drove a short-term increase to 163 enrollments, with numbers falling back to 142 in 2018 despite a further program being added.

Enrollments on the business pathway program have fallen sharply over the period with engineering enrollments also declining in 2018. New programs in computer information systems, computer science and finance have ameliorated the overall decline. These shifts demonstrate that traditional recruiting patterns are under considerable pressure and raises some questions over whether emerging courses will reach the same volume of enrollments.

Table 3 – INTO Colorado State University Enrollments – Fall 2015 to Fall 2018

Source: Institutional Research, Planning and Effectiveness Reporting

At the time of writing it was not possible to find any specific detail about enrollments in the Washington State pathway programmes.

FUTURE DIRECTIONS

US pathway growth continued after new international student enrollment growth peaked in 2016, with around 20 further partnerships by 2019. The ubiquity of pathways has seen an increasing duplication of academic offering and ranking status within each provider’s network. The recent closure of three of CEG’s pathways operations in the US suggests that some partnerships may begin to look sub-optimal over time and that restructuring is likely to happen in the future.

In this new world, well-placed universities looking for partnerships hold a great deal of power to dictate commercial terms or to choose to invest in alternative recruitment options. Locking out competitor institutions, contractually-binding performance criteria and understanding how to exit a failing partnership without penalty should all be considered as part of the commercial terms. There are still many opportunities for the smartest and most creative to do well.

*Data provided by universities is seldom wholly consistent and some provide greater granularity than others. Every effort has been made to make fair and consistent comparisons but any authoritative corrections or comments are welcome.

Brexit – University Challenge But Pathway Provider Opportunity?

Last Friday saw a pretty eye-catching announcement by the University of Surrey whose problems appear to demand radical cost-cutting action including offering all staff voluntary redundancy. One highlight was Vice-Chancellor Max Lu’s comment that ‘Some of the main financial challenges include reduced income due to Brexit….’. If that’s right a number of universities might be even more troubled.

In 2017/18 the average percentage of EU students (defined as EU domiciled but non-UK) in all degree awarding institutions listed by HESA was 5.94%. With an EU population of 9.9% Surrey was considerably above the norm but far from alone with Lancaster University and City University at 10.1% and 10.5% respectively. This might go some way to explaining Lancaster’s desire to set up a remote campus in Germany.

Leaving aside relatively narrow, specialist degree awarding institutions, Cranfield with 21.2% EU and University Colleges Birmingham with 20.6%, look to have a lot at stake. The broadly-based university with greatest exposure seems to be Aberdeen where 19.9% are EU. If the big brands and specialists are able to overcome any Brexit jitters the next most vulnerable English university looks to be Essex with 12.8% EU.

Table 1: Top 20 Universities for EU Students As A Percentage Of Total Enrollments (excluding specialist institutions) 2017-18

Of course, the spectre of Brexit may just be the University of Surrey’s way of getting impetus for restructuring. To be absolutely fair Lu’s comments continue, “… and an ever more competitive student recruitment environment, significantly increasing pension costs and a national review of tuition fee levels.”. That would be true for every university so it is interesting that he adds, “Our university also faces the not inconsiderable impact of a fall in our national league table positions.”

The potential for league tables to create such havoc with a University’s finances is troubling and needs consideration at another time. But the potential for a sharp fall in European Union recruits is certain to be a concern for those institutions with heavy representation and it would bring even sharper competition to the battle for UK and full-fee paying international students. In that respect the bigger brands have an inbuilt advantage and will be looking to take an even bigger share of the market.

As Brexit plays out it will also be interesting to see if more pathway operators are able to convert university nervousness about recruitment into opportunities for partnership. Navitas seem to have a head start in operating overseas campuses for partners, but QA Higher Education operates UK campuses with full-degree courses for several of its partners, and INTO have been doing the same for Newcastle University in London. It’s an interesting development area for pathway operators attempting to diversify and deepen their services.

GOOD NEWS – FOR SOME – IN UK INTERNATIONAL ENROLMENT 2017/18

The latest HESA release showing enrolments in UK institutions for 2017/18 show a welcome increase in international enrolments. Digging under the surface suggests that the trends of the past five years are getting reinforced. The big brands are doing well and there are a couple of well organised outliers.

Table 6 of the HESA data allows us to look at total enrolments by individual institution which gives a good sense of who is able to replace students leaving the university with new enrolments as competition increases. Looking at the total enrolments also gives a better sense of what might be happening to tuition revenue. The table shows that total international enrolments have gone up by 3.8% from 307,540 to 319,340 – that’s 11,800 students.

Ten institutions absorbed 7,320 additional students with the Russell Group universities taking eight of the ten places. In terms of ‘branding’ the 24 Russell Group universities added 10,230 students overall. De Montfort continues its remarkable performance in international recruitment and that’s great credit to the focus and discipline of the management team.

The performance of the University of the Arts is also very strong. Looking at the Annual Report the university is showing a 19.8% increase in international fee income for the year in question – from £86m to £103m. It’s a strong and differentiated higher education brand in one of the world’s most culturally vibrant cities and looks to be leveraging those benefits

Table 1 – Top Ten Universities for Increases In Total International Enrolments (Non-EU) 2017/18

This lop-sided distribution of growth inevitably means that some universities did less well. Those showing the largest losses may all have strategic reasons for reducing international numbers but that seems the least likely explanation. The universities Sheffield Hallam, Hull, Sunderland and Greenwich were all identified as being in long-term decline in international enrolments in my blog Winning And Losing In Global Recruitment back in April 2018.

Table 2 – Top Ten Universities for Decreases In Total International Enrolments (Non-EU) 2017/18

While international enrolments reflect global competitiveness they should be seen in the context of wider recruitment issues in the sector. Lower ranked universities are already being squeezed by the bigger and better placed universities when it comes to recruiting home-students. It’s a painful double-whammy for some institutions as they face into the Augar Review and the Government’s thinking on post-school education.