Tag: universities

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.

From Deal to Delivery With Pathways

After the champagne has been drunk and lawyers have left the building the respective teams of the pathway provider and the university face ‘operationalising’ the arrangement.  57% of College and University Admissions Directors believe ‘pathways programs will become more important to US higher education in the current environment’ (IHE/Gallup Survey, 2018) so it’s a good moment to consider how that can work.  Here are a few thoughts and things to consider based on experience from both sides of the fence.   

Most deals are driven by senior management who want to meet strategic needs including more students, revenue and diversity.  Work groups, steering boards and workshop sessions are often held in the context of political will from the top down to get a deal done.  But once they believe the international recruitment issue is resolved the top team moves on to other priorities.

The failure of many pathways to deliver the expected results can be traced back to this moment because there is no perfect preparation for the day to day engagement between two culturally different organisations.  Caution, disorientation and lack of empathy quickly become frustration, blame and mistrust.  As Mike Tyson memorably put it, “Everyone has a plan until they get punched in the mouth”.

Personal relationships between key decisionmakers can help and one example will serve. One pathway provider wanted to take over all communication with agents, a plan that was being resisted wholeheartedly within the university.  It became a symbol of resistance in the international office but a sign of naivety and bloody mindedness by the provider. 

Over a couple of Long Island Iced Teas in a Malaysian bar the universities head of international recruitment explained the insecurities, egos and justifications to the provider’s Global Sales Director.  After a pause he simply said, “OK.  You carry on communicating directly.  As long as you promise that we can review in six months and if it isn’t working we try my way.”

It allowed the head of international a ‘victory’ but also the chance to give a clear warning to the internal team that they had to deliver.  Having conceded without rancour the provider was able to leverage goodwill on other issues. A year or so later both the main protagonists agreed that it was never that important an issue in the first place.

But personal relationships are the result of hard work, respect, regular engagement and transparency.  There will always be decisions to make, changes to consider and strong views to manage. Below are a few things that will almost certainly come up in the first year or so and some possible responses.  

  • Entry requirements will need reconsidering.  Most pathway providers will, at some point, say that recruitment or progression is being hindered by unrealistic academic standards.  Every university with a few years of successful recruitment will want to raise grades and then gets surprised when applications drop off. 

Be realistic and conduct ongoing research into what is happening in the market – not just in your country but around the world. Too many universities fail to fully understand international equivalencies or the difference between school systems in other countries.

  • Cost of acquisition is going up and universities should invest. Competition is tough and commission deals are a complex range of standard, special, emergency and wrapped in deals for marketing, trips and exhibition slots.  The suspicion is always that higher costs are simply an excuse to cover poor recruitment planning.

Understand the providers commercial plan for engaging with agents and why they believe it works for your university.  Then keep asking how it is going and what evidence exists – term sheets are relatively easy to get from friendly agents.  Consider the lifetime value of the student to the university and work with the provider to consider that return holistically. 

  • Academics should travel to support recruitment.  Some academics have been global road warriors with great success and some senior management teams spend weeks on the road at key times.  Some try never to leave the university campus because it interferes with their research or they don’t have budget.    

In the battle for students an academic title can make a real difference and overtime the winners will have academics who travel regularly.  Get used to it and build an internal team that is willing to trot the globe and work hard to recruit. Also, make sure there is a budget to support international travel – time in country is never wasted.

  • Admissions times are rarely fast enough.  This usually become a running sore and it needs to be dealt with quickly. Standards should be agreed before the deal is signed but even then the provider will want to move the goalposts.     

Admissions processes are part of the recruitment arms race and sometimes responses are needed very quickly to optimise enrollments.  Work with the provider to make the internal investment case for improved systems, people and processes.  Start from the point that admissions is a bridge not a gate – the objective should be to secure every student who has a reasonable chance of completing their academic programme. 

  • Targets will be missed.  In the heat of deal making the pressure to close is intense and people, on both sides, sometimes get greedy and fearful in equal degree. Too many partnerships then work under a fog of misunderstanding and misinformation about target, stretch target, baseline, quotas etc.  Even worse can be a lack of realism and prompt feedback about changing market conditions.

Start by presuming that first-year recruitment may be well below target (and that it is not necessarily the providers fault).  Make sure university budgets, assuming progressing students, have a reasonable buffer.  Do the work to review second year and third year targets as early as possible in the light of experience.  Understand what can and will change to make ensuing years better.   

  • Universities expect the provider to do it all.  It can seem reasonable to hand the controls to the ‘experts’ and sit back to watch the students roll in.  And there is always a get-out clause or a contractual stick to beat them with if targets are missed.

That is not partnership and universities should want to be involved in anything that involves their reputation.  It’s not just about money because students and staff have a stake in the outcomes.  University staff know their institution better than any external provider ever will – the more generous and helpful they can be the better for everyone.  And providers need to socialise new thinking carefully rather than launching a new plan that is seen as counter-cultural.

  • Senior people and champions will leave.  A partnership deal is often partly the result of a meeting of minds and ambitions.  But it is rare for the original movers and shakers to be as regularly involved after three years.  Incomers will have different understandings and motivations and the glow of ‘mutual benefit’ can be tarnished by competing interests.

Providers need to be alert to changing University personnel and work hard at relationships– not just at senior level but by embedding themselves at several levels.  Taking time to understand new thinking while establishing a common knowledge of history pays off.  Universities need to make sure they are allowing good access and taking time to keep their internal audiences informed.

This list is not intended to be exhaustive and there is plenty more that could be said about building long-term, productive partnerships in student recruitment.  Neither partner should expect to have it all their own way but the search for optimal outcomes should be ceaseless.  Perhaps the best advice is to have ‘the qualities of an old political fighter’ as Boris Yeltsin once ascribed to a colleague – ”patience and flexibility, always searching for intelligent compromise.  

2018 Surge in UK Student Record of Prior Acceptance

This may be one for aficionados of the nuances of UK Higher Education admissions trends.  A lot of attention has been paid to the rapid growth of unconditional offers as a way of inducing undergraduate students to go firm with a university.  But there seems to have been no comment on last year’s near 38% rise in Record of Prior Acceptance (RPA) applications registered by UK students.

For the uninitiated the RPA allows a student and university to deal directly to make/accept an offer rather than going through the UCAS system.  To ensure that the UCAS reporting captures all students universities then report the RPA students to UCAS.  Once the student completes the RPA form they are not able to make any other applications.  

After a period of relative stability the number of RPAs registered increased by 7870 year on year for UK students.  This was in a cycle where the number of UK applicants overall fell.  Both Other-EU and International students using RPAs increased – the former by 43.6% – but from a lower base.  

It seems plausible that the driver is that students have decided to start using RPAs more often during the clearing process.  But it seems a stretch to believe that they know about this route for applications before engaging directly with a university.  For the university it allows them to help the student while reducing the chance of that individual shopping around for options.

In the scheme of things, the numbers involved are still relatively small.  Just over 6% of the total number of students used the RPA route in 2018.  But that’s up from 3.9% in 2014 and just 4.8% in 2017.  As the demographics make UK students increasingly sought after it’s another dynamic to consider.

 

Open Doors and Outliers – Looking For Rubies in a Mountain of Rocks

Open Doors data, published by the Institute of International Education (IIE) on 13 November, confirms the much-anticipated decline in international student enrollments in the US. But delving into the detail demonstrates that there are also outliers with significant growth in international students year on year. It is always interesting to dig down to see who is bucking the trend – but more importantly how they are doing it.

At the headline level there is unmitigated gloom with the total number of enrolled international students in 2017/18 down by 11,797 (1.3%) on the prior year. There are also signs of a fractured pipeline for Fall 2018 with non-degree student starters down 9.7% year on year (4,868 students) and down 23.8% (14,135 students) from the 2014/15 peak. Since a 2015/16 high-point undergraduate and postgraduate new-enrollments are down by 9% (10,723) and 6.8% (8,556) respectively.

Table 1 – New International Student Enrollment in the US 2007-08 to 2016-17
Source: Open Doors Report on International Educational Exchange. Retrieved from http://www.iie.org/opendoors

Against that background the state of Kentucky was eye-catching for two reasons. It posted a 26.9% increase in international students – an exceptional performance for a state that was, in 2016/17, 31st in overall popularity in terms of volume of students enrolled. Within the state Campbellsville University was the only one of the top five (by volume enrollments) to grow and became the leading recruiter with a year on year increase of nearly 2800 students.

Table 2 – Year on Year Change in Foreign Students in Kentucky (Source: Open Doors Fact Sheets 2017 and 2018)
IPEDS data shows that across all domestic and international, full and part-time enrollments Campbellsville grew by 96% year on year to Fall 2017. A time series shows that growth at the institution accelerated very significantly in the past year. Graduate part-time has been the primary engine of growth with graduate full-time and undergraduate part-time also contributing.

Table 3 – Campbellsville University Total Graduate and Undergraduate Enrollments 2014-2017
NB: 2017 data is listed as Provisional Release data by IPEDS

International student enrollments (as per non-resident aliens in IPEDS reporting) have been the driving force for the significant growth over the past year. Full-time international graduates grew by more than 600 year on year and part-time international graduates by over 1700.

Table 4 – Campbellsville Full and Part Time Graduate Enrollments
The graduate growth appears to be almost entirely driven by students from India. In 2016 Open Doors reported the proportion of students from China and India in Kentucky as being equal at 18.9% of the total. By 2017 students from India leapt to 43.1% of the total as China fell to 13.1%.

This is supported by the Quartz news website which published, in May 2018, an article reviewing the courses offered by Campbellsville and another Kentucky-based institution, the University of the Cumberlands . The article quotes Shanon Garrison, the vice president for enrollment services at the University of Campbellsville, as saying that “99% of the students in the course are native to India but live in and work for companies based in the US.” Most students are enrolled in the Masters of Science in Information Technology and Management (MSITM).  which, according to Quartz, is ‘designed to allow international students to work full-time jobs while enrolled.’.

The report suggests that students are required to attend the campus for three days of face-to-face classes at the beginning of each term and that the degree costs around $17,000. Flexibility, affordability and the opportunity to work appear to be key factors in the popularity of the course. It is a powerful combination which appears to have turbo-charged growth at Campbellsville.

International recruitment has always been a space where intelligent minds consider ways to develop creative programming that works productively within the legal, visa and competitive environment. Large institutions can often be relatively slow in adapting to new circumstances or may rely on their reputations to see them through the bad times. Innovation and boldness are usually the hallmarks of smaller, more nimble institutions and their successes are often worth considering.

The purpose of looking more closely at the University of Campbellsville is to illustrate possibilities and is not intended to advocate for or against the model. The Quartz article outlines some of the potential challenges and it is not unusual for innovation to appear in specific niches that are inaccessible or out of scope for other institutions. But at a difficult time for US international student recruitment it’s interesting to see opportunities that are still being discovered and exploited.

 

FRESH HOPE OR ZOMBIE DAWN AS CLEARING FOG LIFTS?

Day 28 sounds like a bid for the latest in the zombie movie franchise but its the UCAS yearly data-release marking four weeks from A-level results day. For some UK universities the former might feel appropriate because the clearing season is nearly over and visa deadlines are coming. It’s not long before all that is left is the counting of enrolments.

This year Day 28 was 13 September with the data published a week later. These numbers give the best indication of how far the UK has come in enrolling new undergraduates for the 2018/19 academic year.  It’s a mixed bag.

The good news that the number of ‘placed’ international students (non-EU) is up 4% to 38,330 – that’s 1,500 more than last year. It’s a solid gain although slightly disappointing after double-digit applicant growth in the early part of the cycle. It looks anaemic against the growth in Canada and Australia but is likely to be better than the US.

At a subject level the biggest winners are Business and Administrative Studies (+350), Computer Sciences (+310) and Biological Sciences (+240). However, the number of Engineering students is down by 230 and at its lowest level since 2012. The five-year growth in Technologies has also been reversed with a loss of 130 students taking it to its lowest ever total.

With 6,040 students international students still holding offers the eventual enrolment outcome remains uncertain. In 2015 the number holding offers on Day 28 was 6,380 but in the past two years had fallen to 1,760 (2016) and 1,610 (2017). It is difficult to understand what is driving this fluctuation and there may still be time for a late windfall.  But the majority may just be phantoms preying on the minds of hard-pressed recruitment teams.

More good news is that EU-students ‘placed’ are also up by 2% to 30,350. This is still slightly below the number for 2016 but is some cause for encouragement. A number of universities, including De Montfort who opened an office in Portugal earlier in the year, are enhancing their physical presence in Europe. It will be interesting to see how these developments plays out with Brexit looming.

The bad news is that the total number of placed students after 28 days – counting all domiciles – is down by 10,000. At a standard UK home student fee rate that’s £277m of fee revenue over a three-year degree. Universities know that the home-student demographic dip will continue for a few years, which is one reason those that can have been building their student base. It seems to be one factor behind the growth in unconditional offers from well-ranked universities.

Table 1 – Total of All Placed Undergraduate Students 28 days After A-Level Results
Of course, undergraduate enrolments are not the only source of student income for universities and postgraduates make up the bulk of international enrolments.  But it is also difficult to see why the postgraduate enrolment picture would be much of an improvement on that for undergraduates.  And an enrolled undergraduate gives a near guarantee of three years income compared to the yearly challenge of recruiting more one year taught Masters students.

Against this background it was interesting to read Being set up to fail? The battle to save the UK’s Universities from speculative finance. The article, from May 2018, notes that ‘some £3bn has been borrowed by UK universities since 2016, over half of this in the form of private placements.’ Some of that borrowing may be based on predictions of student enrolments that look increasingly unsustainable.

This echoes WonkHE’s November 2016 report, Getting worse: HEFCE’s bleak prognosis for university finances. One recruitment related line from HEFCE was “Our financial modelling shows that removal of projected growth in overseas fee income over the next three years (2016-17 to 2018-19) would all but wipe out sector surpluses by 2018-19, with projected surpluses falling from £1,081 million (3.4 per cent of total income) to £56 million (just 0.2 per cent of total income).”

It is to be hoped that the early warning signs from HEFCE were heeded and that the long-term financial health of individual universities has been considered more carefully over ensuing years. My blog Getting To Grips With Pathways – A Thorny Subject? showed the decline in some university incomes that has already become evident as international enrolments fall. The UK demographics will not improve for several years and the battle for international students will not get any easier.

GLOBAL LEAGUE TABLES OFFER MIXED NEWS FOR THE US AND PATHWAY PROVIDERS

Credible and well publicised global comparative university rankings are one factor changing the face of international recruitment. Students and their advisers can compare and contrast between Beijing, Berlin, Boston and Birmingham at the touch of a button. The rapid growth of online courses from universities around the world has also helped to popularise the notion of ‘shopping’ for courses through the internet.

It is clear that league tables matter and that universities see them as an important part of student recruitment.  Some less welcome consequences include misleading claims and recent incidents suggest that data submitted is not always accurate.  Perhaps these incidents reflect the recognition that league tables can help build reputations that support both country and institutional desirability.

In that respect evidence suggests the US is losing its way as a global rankings leader with strength in depth.  For pathway providers it’s a double-whammy when the quality of their US partnerships, as defined by global comparisons, looks to be lagging behind their partners in other parts of the world.  At a difficult moment for US recruitment of international students it may be another indicator of harder times ahead.

US DECLINE IN GLOBAL RANKINGS
The US has traditionally been dominant at the top of global rankings and remains powerful. But The Economist (May 19th 2018) highlighted how its broader grip on the Academic Ranking of World Universities (ARWU) table has slipped over time.  Chinese and Australian universities have seen the most significant growth in the table over that period.

Table 1 - Representation of Countries in ARWU TOP 500 - 2003 to 2017

The Times Higher Education (THE) World Rankings also noted that in 2018 ‘two-fifths of the US institutions in the top 200 (29 out of 62) have dropped places.’ In contrast, two Chinese universities had risen into the top 30 for the first time.  This shift in global power reflects the growing power of China as a first choice for international students.

US PATHWAY PARTNERSHIPS BELOW TOP LEVEL
While many US universities are slipping in global rankings, pathway providers also seem to be struggling to secure partnerships with the very best universities in the country. Since April 2016 none of the partnerships announced by Study Group, Navitas, INTO or Shorelight has been in the top 200 in the QS Ranking or THE World rankings.  Only two make it into the US News and World Report (USNWR) Global top 200.

Table 2 – Comparative Ranking of New US Pathway Partnerships Announced Since April 2016*National rank unless noted

Looking over the total portfolio of pathway partners of the ‘big 4’ providers in the US shows that more than half are not globally ranked by the QS, THE or, even in the US News and World Report Global Top 1000.

Table 3 – Global League Table Rankings of Pathway Provider Institutions in the US

UK PATHWAY PARTNERSHIPS LOOK STRONGER IN GLOBAL RANKINGS
Three of these providers are active in the UK where their portfolios look significantly stronger in terms of global rankings. With the addition of the fourth big player in the UK – Kaplan – the overall number of partners is similar. At an aggregate level the worst performance is in the USNWR ranking but even by that measure less than a third of partners are unranked.

The UK is a more mature market for pathways but the recent emphasis of the major players seems to be on enhancing quality. Kaplan partnered with the University of Nottingham in July 2016 and Study Group announced a deal with Durham University in February 2017. Kaplan and Navitas have established new-style arrangements, including investment in infrastructure, with long-term partners Liverpool and Swansea respectively.  INTO’s last UK deal was with the University of Stirling in April 2014.

Table 4 - Comparative Global League Table Rankings of Pathway Provider Institutions in the UK

A GLOBAL LEAGUE TABLE FOR THE ERA OF THE CLICK
Some pathway groups also have strong representation in Australia (and to a lesser extent in Canada). A composite league tables to reflect this and show the ‘top 11’ pathway partner universities, according to three major global league tables, shows considerable consistency. Six universities (shaded) are in all the tables and five are in two.  It is, however, worth noting that all but one have slipped lower in their placing between THE 2018 and THE 2019.

Table 5 - Top Pathway Partner Universities In Selected Global League Tables

NB: The University referred to in the table as Alabama is the University of Alabama – Birmingham.

CONCLUSION
Most people who work in the sector have seen the growth of league tables as an imposition with occasionally perverse consequences for investment and resource allocation in the institution. It is entirely possible to argue that that the rankings are arbitrary and spurious with no particular relevant to student outcomes.  But they are increasingly offering new layers of insight to capture attention – the QS Graduate Employability Rankings is an example.

Students, parents, agents and employers look at league tables and most student recruitment marketing focuses on favourable rankings while ignoring less flattering indicators. They are far from the only factor involved in decision making but they set a tone that influences potential students and staff. It is rare to find an institutional leader who is not keenly aware of their relative performance.

In terms of international recruitment league tables are part of an institution’s ‘sales kit’ and the growth of global comparisons exposes their relative strengths and weaknesses. It is noticeable that as international student growth has stalled in the UK over the past five years the bigger and better ranked university ‘brands’ have taken a larger share of those coming to the country.  It seems inevitable that this will be the story for the future and that universities without ranking ‘power’ will need to work harder to avoid being marginalised.

NOTE:

The exact nature of pathway provider and university partnerships is not always clear but extensive efforts have been made to focus on pathway partnerships where students are taught on-campus.  The author is happy to hear from any authoritative source who has information that might improve the accuracy of the article.  Any corrections will be noted below. 

Correction and Update – 1 October 2018
The tables and commentary have been updated to reflect the publication of the THE Global Rankings 2019 during week commencing 24 September 2018 (comparative positions for individual universities are shown).  Broadly speaking the new table showed declining rankings for both US and UK universities   In addition, the tables have been corrected to show the rankings for Shorelight partner the University of Mississippi (Table 2) and INTO partner the University of Exeter (Table 5).

Unconditional Manipulation

The latest shouting match about UK universities giving students unconditional offers is drowning out the reality that the system is broken.  It also ignores the likely reality that demographics will solve the problem in due course.  But for now, and probably in the future, the playground bullies of government and UniversitiesUK will ignore the real victims – the students.

Here are some of the main reasons.

The evidence suggests that A-level predictions have always been a poor way to select students for university.  A report, Predicted Grades: accuracy and impact based on the A-level results of 1.3 million young people over three years showed that only one in six A-level grade predictions were accurate. Three-quarters of actual grades turned out to be lower than teachers had estimated, while just one in 10 were higher.

Universities know this but have been happy to play along for many years.  Indeed, it was a very useful thing to know when they faced a cap, with financial penalties for exceeding the limit, on the number of students enrolled.  Universities could make more offers than they had places for, knowing that a significant proportion of students would miss their grades and could be rejected.

Then the game changed.

The cap was lifted and each individual student was worth more because of the introduction of fees.  Universities had been on a major spending spree to build accommodation and so the need to enrol sufficient volume was no longer just an academic matter.  And the growth in international students slowed significantly making UK students increasingly valuable.

The remorseless weight of demographics also played its part as the Office for National Statistics graph below shows.  The number of UK students of university age has been declining for several years so institutions wanted to ‘fill their boots’ with as many as possible. The need was particularly acute because the decline in university age students will continue to fall for another couple of years.

For universities the ambition was to recruit as many students as necessary to fill the gap while finding ways to ensure that they got the best students possible.  One way to manage that was to give unconditional offers to students that are in the A to B range for their A-levels while knowing that a proportion will slip to C or even lower. Students keen to get to the best quality university forsake their insurance offer and may mentally switch off on doing their best at A-level.

Worth remembering here that the first big name to go to ‘unconditional offers’ was the University of Birmingham who would be in search of top-quality students.  Also worth remembering that University planning offices are filled with terrifyingly bright people who eat statistics for breakfast.  They can predict with reasonable certainty how many students can afford to slip an A-level grade but are still likely to achieve a good degree (because the institution doesn’t want its league table position to slip).

A cynic would add that one of the points about emerging grade inflation in university awards is that the institution has the absolute power to manipulate the grades its students get.  So even if the slippage in A-level points for the intake is damaging on one league table measure it can easily be made up for by an increase in the number of students getting a 2:1 or better.  When organisations are autonomous and self-governing there is very little to prevent them making the rules up as they go along.

It’s a perfect storm of financial commitments, student scarcity, and a broken application system with poor data that the sector has consistently failed to fix. When you add to that mix the reality that universities can fix the outcomes it is no surprise they choose to game the system.  Even if it’s not in the interests of the students.

But time will change these dynamics.

Even if nothing else changes the demographics of the UK will change behaviours. As the ONS data (above) shows the university may not have enough places by 2030 to take all the candidates that want to go.  Faced with more students than they need universities will tighten their offer policies and the unconditional offer will become as rare as rocking horse droppings.  It’s a situation where the basics of supply and demand provide a market solution.

But that seems to me to be cold comfort to students who have little insight and no voice at all in the way the system runs.  Their plight is made worse by the constant changes in Government policy and the responses of self-interested universities.  About time somebody set about mending the underlying system and holding people to account.

Understandable Caution About Students (UCAS) As Deadline Passes

The UCAS release of June deadline undergraduate applications is a snapshot giving insights into potential international (non-European Union) enrolments in the UK for September 2018. The scenario is a bit like England reaching the World Cup semi-final stage – enough to excite and build expectation. But we all know what happened next in that story.

News to cheer is that the number of applicants is up 4,550 from last year’s figure and 75,380 applicants looks like strong growth against last year’s 70,830. But underneath the headlines there are some interesting trends and nuances. It’s also worth bearing in mind that the UK’s compound annual growth rate for applicants is only 2.24% a year over the three years since 2014/15.

The other interesting factor may be the need of UK universities to fill the gap left by declining numbers of home student applicants – over 18,000 down year on year for 2018 entry. This seems certain to drive vigorous competition for existing international applicants. And the race to convert students in the last chance saloon of clearing will equal the stress levels of any penalty shootout.

MOMENTUM HAS SLOWED
A bird in the hand may be worth two in the bush as far as applications are concerned but early momentum in the recruitment cycle has fallen away. Year-on-year percentage growth of applicants has declined with each of the four UCAS deadlines. From a high in October of 11.7% it has fallen to a solid but less exciting 6.4% at the end of June.
Source: UCAS

This follows a broad trend in the growth in volume of international applicants applying between the January deadline and the June deadline slowing. In 2014/15 there were 18,510 additional applicants while in 2017/18 it has been 16,930. That’s growth of 35.6% and 29% respectively on the January total in each year.

It seems likely that students and agents are getting better organised earlier in the year.  That would be a reasonable response to some of the changes in visa requirements and language testing in recent year.  But it places an emphasis on speed of response to applications and the strengthening of conversion campaigns early in the cycle.
Source: UCAS

EARLY APPLICATIONS STRONG BUT MEDICINE LAGGING
Nearly 30% (1,350) of the total growth in international applicants came by the October deadline for students applying for Oxbridge or courses in medicine. However, the number applying for medical courses (3,310) remains below the 2014 figure of 3,490 despite the number of new medical places in recent years. It seems possible that competition is significantly undermining the attraction of UK medical courses and we know, for example, that as long ago as 2015 eighty per cent of Indian students in China were following undergraduate clinical medical courses (Source: The Economic Times, May 25, 2015).

The rise in non-medicine applicants is a strong step forward but the drivers are unclear. HESA figures suggest that between 2013/14 and 2016/17 both Oxford and Cambridge increase their total undergraduate population by 20% or more. It is possible that they are pushing on more aggressively and stimulating interest.

Alongside this is the growing flexibility of Russell Group universities, as evidenced by the number now making unconditional offers, and their hunger for international students. International students and their advisers may believe that their chances of successfully enrolling in a well-known, highly ranked UK university have never been better. At a macro-level the rise in early applications suggests that strong, well-ranked brands will do best out of any increase in applicants this year.

Source: UCAS

RELIANCE ON CHINA CONTINUES
Overall and as expected China and India have posted the largest uplift in terms of students applying – up by 1,850 and 1,100 year on year respectively. It seems possible that the UK is partly a beneficiary of what could become a very difficult enrolment period for universities in the US. In that respect the next biggest growth in international applicants is 300 from the USA.

Despite the good omens experienced international recruitment teams will not be counting their students before they arrive. The UK government’s failure to ease the visa situation for students from India by making the country ‘low risk’ could still play badly. But there must be reasonably strong expectations of a solid year for enrolments at this point.
Source: UCAS

CLEARING LIKELY TO REMAIN IMPORTANT
Another factor is clearing which includes all students applying after the June deadline. Over the past five years the peak number of international students ‘placed’ in universities in the 28 days after A-level day was 7,260 in 2014. This fell year on year before increasing slightly to 6,500 in 2017.

There are a lot of students available and most universities have strengthened their ability to operate efficiently at home and internationally under the pressure of clearing. Making on the spot offers, converting interest and having strong teams in place, including academics, are commonplace. Again, the well-known names would expect to dominate but as they fill there is opportunity for others to compete.

Source: UCAS

AN OPPORTUNITY FOR ALL – BUT REASONS TO BE CAUTIOUS
My previous blog  showed that growth in international enrolments over the past five years has been dominated by metropolitan, Russell Group names. It is reasonable to assume that large, globally-ranked and well-known universities will now dive even more deeply into the pool of international students than ever before.   The economic pressure and the likely shortfall in UK students over coming years will make this a priority.

And the wise will realise that the increase in their own applicant pool may be undermined by multiple applications.  My analysis of the UCAS numbers suggests that while there are 4,550 additional applicants there are an additional 21,010 applications in the system.  Over 3,600 of the additional applicants made the maximum of five applications and the majority of the rest made at least three.
Source: UCAS

US University Pathways – Build It And They Will Come?

In 2014 Karen Khemka, a partner with the Parthenon Group, said “The U.S. third-party/outsourced pathway market is less than half the size of the Australian market despite having a higher education system that is 10 times the size.We anticipate that growth will be constrained only by the pace at which private providers can develop the market.” (Inside Higher Education, Bridge or Back Door? 30 April, 2014).  With reports recently indicating that two leading providers in the US, Study Group and INTO, are for sale it’s a good moment to see what has happened.

Khemka’s statement came towards the tail end of a period when more than a billion dollars was invested in private pathway providers with the potential for pathway development in the US a strong incentive.  But the next billion-dollar question facing potential investors may be whether US pathways were really a field of dreams where you could, to borrow loosely from the film, ‘build it and they will come’.  Or has attention to the supply side of the equation ignored the challenges of changing patterns of demand around the world?

To size the growth in capacity in the US I took the NAFSA publication Landscape of Third-Party Pathway Partnerships in the United States (NAFSA, 2017) as a starting point. The publication identified eight providers who were partnering with 45 institutions on 1 April 2016. The criteria was that these partnerships had to be ‘contractual agreements between universities and third-party entities to provide English language courses along with academic credit.’

I revisited each of the third-party entities listed to determine what relationships they have added. It is reasonable to say that the wording of some media statements and the content of web-sites is, either by accident or design, unclear about the exact nature of the relationship or offering. However, Table 1 summarises my understanding of new partnerships that meet the original criteria and notes the dates they were announced.

Table 1 – New US Pathways of Eight Providers Announced 2016 to 2018

* Source: Landscape of Third-Party Pathway Partnerships in the United States (NAFSA, 2017)
**I can find no public announcement of the Shorelight partnership with Utah but it is reflected on the web-site of each organisation

Table 2 shows arrangements listed on the providers’ websites but which I have omitted. I am happy to accept any authoritative corrections in my understanding of the nature of the partnerships or courses provided and to add any partners I have missed.  I have not gone beyond the original group of providers although a number of additional providers, such as EC Higher Education, have also developed pathway courses in recent years.

Table 2 – Partnerships listed on provider websites but not meeting criteria

The eight providers have added 21 new partnerships to the 45 shown in the original study – a growth of 47%. This suggests that the private providers have set about growing their businesses in the US with a good deal of vigour and some degree of success. At the time of Khemka’s quote in 2014 Shorelight was a new player but they have moved on to secure the most partnerships just four years later.

That growth in pathway capacity comes at a time when the global balance between supply and demand is in a state of flux and the future is somewhat less certain. The expanding availability of degrees taught in English and the ambitious targets of both traditional recruiting countries and emerging destinations has radically changed the competitive environment. While much of the world is adding rocket fuel to its recruiting engines the US looks to have loaded its unleaded petrol engine with diesel.

In the US a decline in non-degree new enrolments in 2015/16 was followed a year later by both graduate and undergraduate new enrolments declining. And non-degree enrolments continued to fall in 2016/17 which may be a leading edge indicator of further decline. The IEE Fall 2017 International Student Enrollment Hot Topics Survey says ‘Responding institutions report a 6.9 percent decline of international students enrolling for the first time at a U.S. institution, continuing the declines first seen in Fall 2016.’ (IEE, November 2017)

Table 3 – US New International Student Enrollment, 2006/07-2016/17
Source: Institute of International Education (2017). Open Doors Report on International Education Exchange. Retrieved from http://www.iee.org/opendoors

Like many sectors higher education is being obliged to rethink the fundamentals of supply and demand as demographics, competition and disruptive technologies undermine the old certainties.  It is a challenging moment to be launching new initiatives and building capacity based on past performance.

NOTES AND CORRECTIONS

This post was updated on 24 September 2017 to include Lynn University as a Study Group partner announced in May 2017.  Other related statistics have been updated.  At the time of announcement it was billed as ‘is set to open in January’ – presumably 2018.  As of the date of this correction the partner is billed on the Study Group site as ‘Launching Soon’.

PATHWAY, DEAD END OR TIME FOR A U-TURN?

August 2018 will be the fifth anniversary of Shorelight’s first partner, Bath Spa University in the UK, being announced with suggestions that the university would ‘see its overseas intake swell to around 2,000 students over the next four years.’. The four years would run from 2015/16 to 2018/19.

It seemed a good moment to look at the pathway market and what happens when relationships don’t  work out.  This is partly because we may be entering a period where the pathway sector has matured and circumstances make it ripe for realignment.  The stakes are high on all sides and the factors are particularly relevant to the UK and US where growth in pathways has been rapid and international student recruitment has been under substantial pressure.

As finances tighten university management is under more scrutiny and is likely to demand more in terms of targets and delivery from partners.  The consequences of a failing pathway are becoming increasingly difficult to hide as direct recruitment gets harder.  Providers have their own problems with unprecedented global pressures and ubiquitous competition.  Some may be reaching a point where optimising their portfolio is more important than simply adding or maintaining capacity.

In the UK a number of institutions have been following the University of Sheffield to see how the switch from one major private provider to another might work.  Loyalties are under pressure as university leaders who signed the deal move on and some pathway providers look to change hands after the glut of private equity investment from 2010 to 2014.  Pressure to perform has never been greater.

So, when a pathway becomes a dead-end there is every incentive for one or other party to make a U-turn.  Or, as Warren Buffett is quoted as saying, “Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be a more productive than energy devoted to patching leaks.”  And it doesn’t really matter if it’s a long-term contract (where remedies for under-performance are usually written in) or time for a tender after five years.

IT HASN’T ALWAYS ENDED WELL IN THE PAST
There is, of course, precedent and although closures can be hard to trace I have listed below those that I have uncovered in my research.  New partnerships are usually heralded with a fanfare and people smiling as they shake hands on a deal done. Unsurprisingly, a veil is drawn over partnerships that end and those that are public are usually dressed in anodyne media responses.

For both universities and providers that is unfortunate.  Considering and addressing failure is a good way of learning and often more informative than the bright, shiny case studies which are so popular as sales tools.  In my time with two leading universities with private providers and as COO and CEO with two providers I saw many factors that can make or break a partnership.  These are worth sharing.

I make no comment on the reasons for the ending of the relationships noted (but have referenced reports where available). Neither do I claim that this list is exhaustive and I would be interested in any other examples.  For organisations contemplating partnerships an open and honest discussion with those who have tried and moved on is probably worth as much as hours of expensive contract development.

Study Group
i) Stirling University (Opened 2007- Closed 2013) Source: QAA

INTO
i) University of East Anglia London (2010-2014) Source: THE)                                                                         ii) University of Stirling London (Opened 2014 – Closed 2015?)                                                                                     iii) St George’s University (Opened 2012 – closed 2017 Source: St George’s University Annual Report

Oxford International
i) Canterbury Christchurch (Opened 2015 – closed 2017?)

Kaplan
i) University of Utah (Opened 2010 – Closed?) ii)University of Sheffield (Opened 2006 – Closed 2015)

Navitas
i) Western Kentucky University (Opened 2010 – Closed 2016)
ii) Edinburgh Napier (Opened 2011 – due to close 2018)

PRIVATE PATHWAYS MAY NOT BE ACCESSIBLE OR GUARANTEE SUCCESS
UK universities with the greatest decline in overall international enrolments in the past five years often have no pathway partner or are relatively late to the party. Several of the non-aligned universities here have been actively seeking providers but there is, inevitably, caution from providers about taking on institutions that do not have underlying strength.

It remains to be seen whether some of the new partnerships can materially alter the trajectory of underperforming universities.  Sector sources suggest that Oxford International and the University of Bedfordshire are parting company and the provider is not currently listing this university on its website.

Table 1 – UK Universities With Greatest Decline In International Enrolments 2012/13 to 2016/17

Source: HESA (enrolments), QAA and University/Company websites

And that brings me full circle to Bath Spa and Shorelight. HESA data (supported by the University’s Annual Report narrative) showed strong growth in international recruitment from 2012/13 to 2014/15. In the first full year of the partnership with Shorelight (2015/16) there was a weakening of growth which was followed by declining international enrolments in 2016/17.  There is some way to go for the university to reach the anticipated 2,000 by 2018/19.

Table 2 – Bath Spa University International Enrolments 2012-13 to 2016/17

Source: HESA

Perhaps more troubling is that in December 2017 the THE reported that ‘figures available on (sic) Companies House show that Bath Spa Global – an international pathway college venture set up in 2014 in partnership with US firm Shorelight Education – has lost about £1.4 million in the three years to July 2016, while its parent company Bath Spa U has lost about £736,000 over the same period.’. The 2016/17 Financial Statement from Bath Spa showed international student income and numbers declining year on year and noted that the joint venture partnership, Bath Spa Global, ‘remains fragile’.  At the time of writing I can find no mention of Bath Spa University on Shorelight’s web-site and no current reference to Shorelight on the University’s site.