Australian Over-investment in International Higher Education

Hurley and Van Dyke (2020) have produced a very timely report on Australia's investment in higher education. This comes as universities are looking at strategies to recover from the loss of international student revenue due to COVID-19. The authors estimate a loss of at least $10B in international student revenue between 2020 and 2023. They also warn COVID-19 could reduce domestic student demand, and suggest a change of "policy settings to increase capacity across the tertiary sector". However, given a reduction in demand, I suggest the prudent course of action would be to make better use of the existing capital investment, not increase it. Universities, and the governments which fund them, need to consider how to provide new forms of education, for both domestic and international students. As an example, through the use of blended learning, the capacity of existing Australian university campuses could be increased five-fold.

Hurley and Van Dyke draw parallels between universities and Australia's automotive manufacturing sector. They point out Australian universities are a much larger industry than car making was at its peak. However, the authors do not go on to draw the other obvious parallel: Australian governments kept subsidizing the Australian automotive industry in a way which made them less internationally competitive. I suggest the same mistake should not be made with universities.

To remain competitive, our universities need to change the educational products offered and the way they are delivered. The two to four year full-time, on-campus degree, offered by Australian universities, is equivalent to the Holden Commodore: large, expensive, and inflexible. Our universities need to offer blended online/on-campus, offshore/onshore learning, with nested qualifications, and workplace learning. This would be the equivalent of the flexible platform vehicles now produced by international auto makers, which allow combustion, hybrid or electric options, in sedan, SUV, and other styles, built in response to consumer demand.

Such predictions may sound alarmist and suggestions for change far fetched. However, in 2017, I warned Australian universities that international students could be suddenly unable to get to Australian campuses, due to an international crisis. I suggested university should be ready with an online teaching contingency, should this happen, and be ready by 2020. The COVID-19 crisis hit in 2020, but unfortunately few universities were ready with an online contingency.

Reference

Hurley, P., Van Dyke, N., (2020). Australian investment in education: higher education. Mitchell Institute, Melbourne. URL http://www.mitchellinstitute.org.au/wp-content/uploads/2020/04/Australian-Investment-in-Education-Higher-Education.pdf