International students turn universities into blood sucking corporations

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Last week, Australia’s media triumphantly reported that seven of Australia’s Group of Eight (Go8) universities were ranked in the top 100 of universities globally.

However, these strong rankings came amid a surge of international students, which has driven a significant rise in the ratio of students to teachers:

Australian universities have bucked a declining trend among US and UK institutions in the international student ratio measure, with 26 or Australia’s 35 universities recording an increase in the proportion of overseas students…

“The influx of international students has coincided with significant and near-uniform drops in our faculty/student ratio indicator,” QS’s director of research Ben Sowter said.

“It is imperative that Australia endeavours to continue expanding its teaching capacity to meet demand that is likely to continue increasing.”

As MB reported last week, the ratio of students to academic (teaching) staff at Australia’s universities has soared since 2011:

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And this has coincided with a near doubling in the number of international students:

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This is especially worrisome given that international students are primarily from non-English Speaking Backgrounds (NESB), have much higher needs, and are typically higher maintenance than domestic students.

Therefore, the increase in the number of students per teacher in addition to the higher proportion of NESB students is unambiguously placing increased pressure on academic staff and reducing educational quality, as was revealed in last month’s Four Corners expose.

Moreover, while academic staff are being placed under increasing pressure, the salaries of vice chancellors at Australia’s universities are surging towards $1.5 million:

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The salaries of Australia’s highest-earning vice-chancellors have passed the $1.5 million mark and experts say they are unlikely to slow down…

At the same time, teaching staff are complaining about high levels of casualisation and Australian institutions are at the bottom of the list in global rankings for their staff-to-student ratios…

Australian universities’ growing student populations are being taught by a more casualised teaching staff in classrooms that are some of the most crowded, according to the latest QS World University Rankings.

Alison Barnes, president of the National Tertiary Education Union, said: “Vice-chancellors’ remuneration is just shocking in the context of a sector where casualisation is at alarming, epidemic levels and universities are under so much pressure.

To add further insult to injury, Department of Education data shows that the lion’s share of the fees from international students has been invested into beefing-up universities’ non-academic staff (bureaucracies):

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As shown above, there were 58,167 full-time equivalent (FTE) non-academic staff at Australia’s universities in 2009, versus 35,817 academic FTE staff – a difference of 22,350.

FTE non-academic staff grew to 69,557 in 2017, versus growth in non-academic staff to 44,057 – a difference of 25,500.

What should become abundantly clear is that Australia’s universities have effectively been turned into blood sucking corporations. Teaching staff numbers have been cut and entry standards have been slashed in a bid to keep the numbers of international students (and profits) flowing. Vice chancellors and senior administrative staff swallowing the gains while teaching staff, students and the broader economy wear the costs.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.