University funding challenges – Part 2

In my previous post – I looked at the raft of issues creating significant financial challenges for much of the publicly funded university sector.

I also looked specifically at recent financial reports, pre- and post-pandemic, to analyse the reliance on government funding and on international student revenue, and new international student numbers, at the following universities:

• Australian National University
• Griffith University
• James Cook University
• Macquarie University
• University of Canberra
• University of Southern Queensland
• University of Wollongong

The reason for selecting these universities is because they have all been in the media recently as they deal with financial challenges and job cuts.

As I and others have noted, while international student numbers are dominating a lot of the debate within the sector and in public, for many universities the financial difficulties they face are a result of a reduction in their government funding for undergraduate students and fewer students choosing to enrol in undergraduate degrees.

The reason for the decline in students commencing university study is not because of the undergraduate degrees on offer (ie factors within a university’s control) – it is primarily because the strong labour market means people do not need a degree to get a good job, and concerns for some students about the debt they will incur from their studies (changes to university funding with the Job-ready Graduates reforms mean approximately 40% of students are now paying 90% of the cost of their courses, and these debts impact their future borrowing capacity).

With cost of living pressures a reality for many students and families, a growing number of students are reluctant to take on a large debt which they may struggle to pay off and which will impact their ability to take out a future home loan.

Here are the trends in domestic student commencements for the above universities at undergraduate and postgraduate level.

At the undergraduate level – across all of the public-funded universities there has been a -10% drop in the number of new undergraduate students starting study compared with pre-pandemic levels.

At the University of Canberra, Griffith University and the University of Southern Queensland the drop has been much more significant.

At the postgraduate level the situation is quite different – except for the University of Southern Queensland which has also seen a drop in domestic students starting postgraduate study.

The exceptional growth in postgraduate enrolments at the University of Wollongong and the University of Canberra warrants further analysis to understand the specifics of what they are offering and why it it so attractive to students?

I understand that the University of Canberra has been focussed on offering more short courses at postgraduate level to support the upskilling and reskilling of professionals, and this is clearly paying off. I am uncertain if the same is true at the University of Wollongong.

The problem is that despite this impressive growth in student numbers, if these students are choosing shorter courses, the universities earn less than they would in traditional longer postgraduate courses (and less than they would if they were enrolling these students in undergraduate degrees), albeit the courses are clearly meeting student needs.

The very substantial decline in postgraduate commencing students at the ANU will be a cause for concern. I understand that the ANU’s postgraduate courses have continued to be mostly taught face-to-face, rather than having online options available.

If that is the case then student choice post-pandemic for more flexible study options (especially amongst those mature-age students who are working and looking to combine studies with work and potentially caring responsibilities) is likely to be a factor in the significant decline in the ANU’s new postgraduate students.

There is a lot to digest in this article and in my previous one.

For me the key takeaways are that the seven universities highlighted here are not all the same – they are reflective of the sector as a whole and include regional and outer-metropolitan universities, and one of the Group of Eight. That means there is no easy answer for government or the sector to these current challenges.

A wide range of universities are being impacted by a range of factors, almost all of which are negatively impacting their current financial position.

And sadly this means that as universities wait for better government funding for their domestic undergraduate students, as they try and redesign their courses to attract more postgraduate students, and as they deal with the challenges of reforms this year to international education and student caps next year – we will see more budget and staffing cuts at more universities.

Spare a thought in all of this for all of the casual staff who, as I noted in the previous post, will not have their contracts renewed and who will not be included in most of the counts of job cuts because of the casual nature of their employment.

Spare a thought also for the remaining university staff who will valiantly be trying to do more with less, and for the students who will likely have less engagement with academic and support staff while they study – simply because there are less of them around.

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All data is sourced from the Department of Education’s Higher Education Statistics Collection: https://www.education.gov.au/higher-education-statistics