In an earlier post, I looked at how the COVID-19 recession might affect school-leaver applications for undergraduate education. I concluded that although the lack of job opportunities would favour continued education over unemployment, the scope for applications growth was lower now than during the early 1990s recession.
School retention is much higher now than 30 years ago, and a much larger proportion of the cohort with a potential interest in university already attends. With the age cohort’s size not changing much in the short term there is less room to move.
Interpreting historical application numbers from older university applicants is complicated. It includes relatively young people, did not until the last decade count direct applications to universities (which are mostly from older applicants), and does not distinguish between applicants who are already students but hoping to change courses and those seeking to enter higher education.
With these caveats, the chart below shows a large increase in applications from non-school leavers in the early 1990s. In percentage terms it is larger than the school leaver increase. It is consistent with the recessions drive up higher education demand hypothesis. The scope for growth is high because it is not constrained by the size of recent Year 12 classes.Read More »
Last week I published a blog post on the financial dangers posed by the COVID-19 crisis starting prior to the census date for each subject. It is a critical date for universities. They get no Commonwealth or student contributions for subjects dropped prior to the census date.
As Stephen Matchett reported in Campus Morning Mail yesterday, social media talk about dropping subjects is still at high levels. One of the reasons, that unemployment income support benefits would be more generous than student benefits, seems to have been fixed in Parliament yesterday. Although I think students are better off finishing their course on schedule if they can, we should expect higher drop-outs than usual prior to the census date.
I am also hearing reports of international students heading home before the census date because of family pressure. They might also leave because they can no longer support themselves due to the collapse of the student labour market. Due to an extraordinary new power to widen social security eligibility some international students might temporarily receive benefits, but I think entitlements are too unclear to change short-term behaviour.
If these drop-outs are happening at any scale then, except for the universities on trimesters that are already past their first census date, then serious higher education financial problems are very close, as universities will have to scale back their expected Commonwealth-supported student revenue and international student fee income for the year.Read More »