With US enrolments declining, strategies may focus further on international students

The most recent instalment of a well-regarded annual survey of American colleges and universities contains findings suggesting that many American higher education institutions may further increase their focus on international students as a source of revenue. The report, by Moody’s Investors Service, surveyed 165 nonprofit private universities and 127 four-year public universities. It found that, for the 2013 fiscal year:

  • almost half of the institutions that took part in the survey foresee lower enrolment among full-time students (especially for graduate programmes);
  • a third expect tuition revenue to decline or not meet the pressures of inflation.

Emily Schwarz, a lead author of the Moody’s report, commented:

“The cumulative effects of years of depressed family income and net worth, as well as uncertain job prospects for many recent graduates, are combining to soften student market demand at current tuition prices.”

In 2010, only 15% of the institutions surveyed predicted enrolment declines, so the fact that nearly half expect them now is a notable sign of the growing pressures on American higher education institutions. These pressures have led to an acceptance that countermeasures are in order to keep revenue coming in. A New York Times article put it this way:

“Since the financial crisis, tuition at public schools has grown more rapidly than private ones, largely to offset sharp costs in state financing. Public universities have responded by recruiting more out-of-state and international students, who can pay more than in-state students.”

Furthermore, Inside Higher Ed called attention to another report released at the same time as the Moody’s one that underlines the increasingly tight situation all but the most elite schools are facing regarding declining revenues and increasing costs.

The Western Interstate Commission on Higher Education report “projects a short-term decline nationwide in the number of college graduates and long-term declines in many Northeastern and Midwestern states, a finding that could increase the costly competition for students.”

As much as recruitment is costly, it is required if an institution wants to reverse an enrolment decline.

Institutions will be looking for the most return on their recruitment buck, and in many cases, this will set a focus on international students, who pay higher tuition than domestic ones in the US as in so many other places. Bloomberg recently reported on the surge in applications various high-profile universities have received from foreign students.

The trend toward international students is not new: according to the Institute of International Education’s most recent Open Doors report, international student enrolment in the US increased in 2012 by 5.7%, and new international student enrolment – students enrolling for the first time at a US institution in fall 2011 – increased 6.5% over the previous year. The infographic below shows more details on international students in the US.

International exchanges in all 50 states contributed US $22.7 billion to the US economy, and China and Saudi Arabia are the main cause of rising numbers.

The Open Doors report also cautions that US institutions may be overly reliant on China as a source country, perhaps prompting American colleges and institutions to further diversify their international target markets.

For those interested, here is a summary of recent ICEF Monitor articles that provide tips on effective recruiting in international markets:

international-students-in-usa



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