Australia’s fake $40bn education exports to halve

The Australian’s higher education shill, Tim Dodd, has penned another article lamenting the loss of international student ‘exports’, which are tipped to halve according to new data from the Mitchell Institute:

Australia’s highly successful education export business, worth over $40bn in 2019, will see its value halved by the end of next year unless international students are able to move freely into the country…

The loss will hit the general economy because, while education export earnings include tuition fees paid to universities and other education providers, most of it is spent by students as rent, other living expenses, travel and entertainment costs…

The report has for the first time estimated the revenue value of students who are studying online from overseas because they can’t reach Australia. It says fees paid by these students added $1.9bn to education export earnings in the last half of 2020.

One can only wonder why Tim Dodd and his ilk continue to report this fake $40 billion export figure as fact? This export figure has been comprehensively debunked on this site, most recently here.

In a nutshell, the majority of education ‘exports’ comes in the form of expenditure on goods and services in Australia, as explicitly acknowledged in the Mitchell Institute report:

The majority of the $20 billion loss of economic value is in the form of goods and services spent in the broader economy: about 36% on accommodation and another 36% is on hospitality and retail.

Given that most international students fund a significant proportion of their expenses via income earned while working in Australia, this by definition is not an export.

The fact that so many international students fell into hardship when they lost their jobs at the beginning of the pandemic, and then demanded taxpayer support, highlights this point. As does the fact that youth unemployment has fallen sharply despite rising participation, precisely because the number of international students working and competing for jobs has shrunk.

Most importantly, genuine education exports – i.e. fees paid into Australia via overseas earned income – have increased markedly during the pandemic, as illustrated by the rising value of offshore online tuition:

International online tuition fees

Offshore online tuition fees have boomed during the pandemic.

Online tuition fees from students abroad have grown from almost zero before to pandemic to $3.8 billion currently where they are projected by the Mitchell Institute to remain.

Thus, instead of importing people to compete with locals for jobs, housing and infrastructure, the education sector has shifted to exporting online tuition.

If the Australian government genuinely wants to lift export returns from international students, it should tell universities to scale-up their online course offerings so as to offer Australian education to foreign students in their own country. Universities should also establish campuses overseas.

The universities would obviously resist these moves, since an Australian education is not what motivates foreign students to enroll in our universities. Rather it is the lure of access to our job market and permanent residency. Our universities are really just immigration conduits.

Our universities know they are selling a pathway to permanent residency, citizenship and eventually family reunion migration. “Study” is merely the inconvenient box that needs to be ticked.

Unconventional Economist
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Comments

  1. TailorTrashMEMBER

    Suspect a lot of those online fees are grudgingly
    being paid to keep the door open until the door opens and they can flood back in for the prized PR and a job at woolies

  2. Looked at a grad certificate (post grad) in health related field. 1 yr part time – online – 11k. WTF. My 4 year engineering degree (admittedly 1996-2000) at RMIT was 21k.

  3. my toranaMEMBER

    You should have heard Margaret Gardner on Radio National yesterday morning. I almost wept at the tragic plight of our international students. The rote mega-figures were shamelessly lapped up by the propaganda supporting RN. It’s quite vile hearing a woman who’s meant to represent the pinnacle of research and erudition talking unfounded rubbish. I thought, Yay, hopefully my daughter will get a year or two at uni when there’s some focus on domestic students.

  4. This s all true but someone needs to fund the salaries of academics. Not like most of them could earn anything but a minimum wage job in the real world.