Russell Group universities contemplate overseas student ‘shocks’

Universities in the UK’s Russell Group warning that they are ever more reliant on international student income from China and India are also facing potential shocks from global market factors, an alarm sounded by a sharp fall in the University of York’s overseas recruitment.

A 16 per cent fall in international numbers at York, contributing to a £24 million deficit (£14 million operating deficit) at the university in 2022-23, spotlights how growing political and economic headwinds against overseas recruitment could affect Russell Group institutions vital to the UK’s research base. The previous year, York drew 56 per cent of its international student numbers from China.

The Office for Students warned 23 institutions about their high levels of recruitment from China in May last year. But 2022-23 financial statements suggest that Russell Group universities’ reliance on international income is increasing.

The University of Manchester’s financial statements spell out the situation, noting that the frozen £9,250 fee is “declining in real terms as inflation continues to push the cost of teaching delivery upwards”. There is, it adds, “currently a low government appetite for increased HE funding, leading universities to continue to be reliant on international students. International student numbers continue to be reliant on students from a relatively small number of countries (China being the dominant market).”

However, there are global factors that could threaten that flow. Phil Honeywood, chief executive of the International Education Association of Australia, said a “stay close to home” enrolment trend for Chinese students, emerging as the nation came out of extensive Covid lockdowns, had already benefited Hong Kong and Singapore institutions.

“Other factors include a concern that if [Chinese students] move too far away then they might lose local networks in China in the context of a 35 per cent youth unemployment rate in some top-tier Chinese cities,” he added.

On India, Mr Honeywood said that “we are still observing a strong migration pull factor” and “any study destination country that is seen to provide some pathway to a migration outcome will gain favour” – words that might not comfort UK universities, with the Westminster government having put the graduate visa route under review.

Mr Honeywood added that the UK’s overall recruitment was seeing the delayed impact of Australia’s post-Covid reopening. “In all of this, UK universities have lost a large number of enrolments from China and India for the simple reason that Australia’s national borders were closed for two years…Affordability, employability and proximity are all pull factors that have favoured Australia in the last two years as well,” he said.

Hollie Chandler, director of policy at the Russell Group, said that “increasing global competition and recent changes to UK visa policies mean that growth in international student numbers is likely to slow”, while domestic funding shortfalls “mean there is increasing pressure on universities to cross-subsidise domestic teaching and research with international student fee income, leaving the sector vulnerable to shocks”.

Diana Beech, chief executive of London Higher and a former adviser to Conservative universities ministers, said the increasing quality of university systems around the world gave students ever more choices.

“What is needed now more than ever from the main [UK] political parties is a joined-up approach to policy – one which recognises that curtailing the graduate route is akin to using a sledgehammer to crack a nut and risks leaving our economic growth and ‘science superpower’ ambitions in pieces,” Dr Beech said.

A York spokesperson said: “The increased student numbers in 2021-22, which exceeded trends because of the impacts of Covid, have now returned to pre-Covid growth levels."

john.morgan@timeshighereducation.com