Comment: Overseas students less able to afford us (The Australian, 20/10/2010)

Is the Education Sector the only scapegoat for declining international student numbers?

In the Bernhard Lanes Article in the Education Section of The Australian from Wednesday, October 20th, 2010, researcher Rob Laurence is cited revealing that latest studies have shown that Australia has become a more costly choice for students willing to study abroad. The major reason being that the market for Australia is more price-sensitive, especially in the education sector. Obviously more students have to add their own income to the funding they receive from their parents.

In my opinion the reason does not lie with the Australian education industry alone. A major factor is the strong Australian Dollar. As indicated again by the June 2010 figures of the Monthly summary of the International Enrolment data - Australia - YTD June 2010, released by the Department of Education, Employment and Workplace relations, most international students in Australia originate from low income economies, China and India.

• As of January 1st 2010, 1 Chinese Yuan Renminbi was traded for Aus $ 0.1632230401, while the Indian Rupee exchange rate was Aus $ 0.0239108971. (XE, 2010a)
• As of October 1st 2010, 1 Chinese Yuan Renminbi was traded for Aus $ 0.1538389865, while the Indian Rupee exchange rate was Aus $ 0.0231771159. (XE, 2010b)
• The value of the Chinese Yuan Renminbi has lost 6% against the Australian dollar over the last 9 month, the Indian Rupee lost roughly 3.2%.

At first glance this doesn’t seem like a big difference. However, taking into account that e.g. the fees alone for an undergraduate degree at Swinburne University (Swinburne, 2010) will cost the international student’s family between Aus$ 16,500 and Aus $ 22,000 over a 3 – 5 year period, adding annual living costs of between Aus$ 15,000 and Aus $ 20,000 (La Trobe, 2010), the average total costs for a student over the total studying period can accumulate to somewhere between Aus$ 60,000 – Aus$ 120,000. Taking average wages in China and India into account, the value increase of the Australian Dollar alone can make the decision to send a family member to Australia for the purpose of studying quite challenging.

Further, most universities have their campuses in metropolitan areas. Another risk factor that I see is the shortage of affordable accommodation. For example, property prices around the three Swinburne University higher education campuses, Prahran, Hawthorn/Hawthorn East, Auburn, Kew and Lilydale surged by an average of 19% (REIV, 2010) over the last two years; another factor outside University that should be taken into account.

Reference

La Trobe University (2010). Living Costs. International Students. Retrieved from http://www.latrobe.edu.au/international/living/costs


Real Estate Institute of Victoria (2010). Trend Chart. Retrieved from http://data1.reiv.com.au/trendchart/default.aspx

Swinburne University (2010). Undergraduate Courses. International Students. Retrieved from http://courses.swinburne.edu.au/courses/coursematrixinternationalunder.aspx

XE.COM Inc. (2010a, January 1st). XE. Retrieved from http://www.xe.com/ict/?basecur=AUD&historical=true&month=1&day=1&year=2010&sort_by=name&image.x=45&image.y=13&image=Submit

XE.COM Inc. (2010b, October 1st). XE. Retrieved from http://www.xe.com/ict/?basecur=AUD&historical=true&month=10&day=1&year=2010&sort_by=name&image.x=45&image.y=13&image=Submit