This month we have talked to many people across secondary and post-secondary education and all have the same question: “How are the changes in the Chinese economy going to impact the number of Chinese applicants choosing to study abroad?”
Based on our observations in China, we think that in the short term there won’t be a large impact on the number of Chinese applicants enrolling in US schools. Despite the recent slow down in the Chinese economy, our conversations with families have indicated tuition continues to be a top priority. As confidence in the Chinese economy wanes, parents are more committed to ensuring their children will have the opportunity to work or settle outside of China. The best way to accomplish this is to give them an international education.
Even so, it is useful to remember that a de-valuation in the Chinese Yuan makes a US education that much more expensive, especially when there are more affordable alternatives in other countries, such as Canada or Australia.
One possible short-term effect may be reduced liquidity for Chinese families. One admissions officer noted that although their Chinese families are still able and willing to pay for tuition, some have asked for an extension of the payment date. The flexibility to accommodate these sorts of requests may enable schools to build good relationships with families.
In the medium term, there may be a bigger impact for some intuitions. As Ronné Patrick Turner from Northeastern mentioned in a recent Boston Globe article: “the impact will depend on where you are, where that institution is and its history of recruiting and enrolling international students.” Schools with smaller numbers of Chinese applicants and/or just starting their recruitment efforts may find China a more difficult recruiting climate than in previous years. A possible mitigation strategy may be to invest in increasing your institution’s brand recognition and perceived prestige in China. If financial pressures continue to increase, parents may be less willing to pay the same amount of tuition for a perceived second or third tier school as they might for a “name-brand” institution.
For the time being, we believe the large numbers of Chinese students coming to the US to study at all levels will continue. However, it is good practice to build a comprehensive enrollment management plan around diversification of the international student body. By recruiting in many different countries, not only will institutions increase diversity on campus, but also they will be better situated to handle sudden, unanticipated changes in the international recruitment landscape.
We’ll keep talking to families and keep you posted on the trends we see from this side of the world. If you have an opportunity to visit Beijing or Shanghai during your travels, please come and visit us. We’d love to take you out for a meal or a beer and chat about what we see happening in China.
Enjoy the lovely fall weather!