The notion that “the enemy of my enemy is my friend” is long established but often misguided and can create a false sense of shared interest, power dynamics and underlying realities. UK universities appear to be united in defending themselves against perceived threats from Government action, media criticism and public opinion/apathy. But loose coalitions of convenience and an unspoken agreement not to criticize each other publicly are unlikely to be enough to either win the day or manage the important business of shaping the sector for the future.
It is equally clear that the financial circumstances faced by individual institutions cannot simply be conflated as a problem driven by visa policy, domestic student fees or Government rhetoric. A first step towards the future is to accept that some institutions face serious problems in even attracting sufficient numbers of students, and may need radical solutions. Another might be to acknowledge that some university management doesn’t understand forecasting, the markets, competition and/or travelled too hopefully for too long, as the University of East Anglia appears to have done when acknowledging “for the third year running we fell short of our student recruitment targets in the home undergraduate student market”.
It would be sensible to look at what has happened to the money injected because of the benevolent international student environment announced in 2019 and whether the pace of recruitment was appropriate in terms of student experience, local services and public opinion. Some universities appear to have built a significant cash pile which may help ameliorate any short-term falls in recruitment and others have chosen to invest the bounty in other ways. Whether those investments were wise, sustainable or designed to maintain/increase domestic student recruitment through, say, a financial subsidy from increased international student recruitment requires a more detailed study.
This blog takes a relatively narrow look at two universities that might appear to have similar opportunities as part of a mission group of “world class research intensive universities”. Using data that reflect 2022/23 international recruitment and tuition fee data rather than waiting for HESA to catch up, it suggests that one has problems pre-dating recent changes to the visa regime. The differential performance in international recruitment demonstrates that even when recruitment conditions are benevolent the market makes choices to the benefit of some universities and the detriment of others.
Hold Your Friends Close..
The current unity of the sector is shallow and self-interested and the UniversitiesUK claim of “142 universities One voice” is wide of the mark. We have the Russell Group, University Alliance, MillionPlus, GuildHE, and Cathedrals Group, but saw the 1994 Group disband in 2013, shortly after several of its number jumped ship to the Russell Group. Any solutions to the sector’s funding problems needs to be even more granular and consider specific issues.
Even though the Russell Group has become the de facto face of higher education for the media and many politicians it is far from a unified and equal group of partners. Colleagues are familiar with my description of a meeting of its 24 members as having the sophisticated six acting cool and sipping martinis in the corner while the regional city types lumber around drinking craft beer and showing off. Members from outside England hang around the fringes trying to attract attention by channeling a moody, Celtic-fringe vibe and the remaining half a dozen wonder why they paid the cab fare to attend when nobody really wants to talk to them.
…And Your Enemies Closer
HESA data delays mean it is difficult to get a full picture of the most recent enrollment success or otherwise of Russell Group universities. What was clear in the immediate period after changes to post-study work visas and up to 2020/21, was that there was a strong focus on Chinese students but with some notable names failing to keep pace. At the recent PIE Live Europe event a University of Glasgow spokesperson indicated that the most recent intake (presumably 2023/24) was “last year we had one of our strongest undergraduate performing years” despite it being the first time in a decade the university had not hit or exceeded its targets
Sympathy should be tempered, for a number of reasons. Firstly, universities have something of a habit of inflating enrollment targets in the good times so missing them might simply be a result of hubris in setting objectives. More importantly, the University’s “Overseas Students” income rose by 10 % (£27.6m) to £303.8m from 2021/22 to 2022/23 and is up a whopping £166.5m since 2019. While conscious that finance can be a tricky business the measures on operating surplus and net cash seem to support the Director of Finance’s view that they can “continue to develop,
invest and deliver on our strategic plans enabled by strong financial results.”
Source: University of Glasgow Reports and Financial Statement
But, as a reminder that the Russell Group university experience is very mixed, the University of York, reported in January 2024 a £24m deficit partly because “International student numbers decreased in the year following high recruitment after the Covid pandemic and reflecting changed geopolitical circumstances.” It might be equally plausible that the moody, Celtic-fringe types from Glasgow, along with other Russell Group members, stole genteel York’s lunch money by competing more effectively for Chinese and other students.
We will know more when the long-awaited HESA 2022/23 data emerges but the UCAS end of cycle data does give a sector wide insight into what happened at undergraduate intake level in 2022/23 and we can see that the fortunes of the two differed dramatically. Glasgow has consistently grown non UK/EU applicants since 2018/19 and after a sharp hike in 2019/2020 has maintained the number of applicants accepted. York saw a small decline in applicants and a much larger decline in applicants accepted from 2021/22 to 2022/23. It may simply be that faced with Russell Group options international students are choosing the biggest name, best ranked or most competitively marketed.
This hypothesis might be supported by the fact that the University of York appears to have been forced to take more non-mainstream international applicants to even reach a declining total of acceptances. The University of Glasgow has been able do exactly the opposite and secure increasing numbers of students through the mainstream route. Mainstream applicants apply through UCAS before the main deadline of 30 June and can nominate up to five institutions to consider their application.
One interesting feature that does combine the two universities is that Kaplan is the operator of the International College for both. In this respect the University of Glasgow annual report for 2022/23 notes that its “excellent..financial results” were achieved despite “..a decrease of £3.7m in partnership income from Glasgow International College Kaplan” and the annual report of the University of York International Pathway College LLP shows a that Operating Profit declined from £2m to £900k in the year to July 2022/23. The University of Glasgow Pathway College entity has a different financial year end so it is not possible to provide a direct comparison.
The University of Glasgow appears to be slightly more expensive than the University of York for international students and the entry grades seem reasonably equivalent. The apparent inability of York to compete effectively for international students despite this may be one reason for the January 2024 report that the University of York was “lowering admission requirements for some international students in light of “financial challenges.” They may still find that the market votes with its feet.
Winter Is Coming
Sometimes the higher education sector can seem like a retread of Game of Thrones including “..several noble houses..a complicated, multiparty war…shifting conflicts, alliances, and betrayals.” Driven by expediency many of the protagonists join together in a final battle to defeat the Night King and the White Walkers but in the end the Iron Throne is melted and the system governing Westeros is radically altered. The Migration Advisory Committee (MAC) review may be the sector’s Drogon or simply signal that winter is coming.
What will remain true is that the sector is not a monolithic entity and it is unhelpful to position it as such. The main beneficiaries of the recent years of the graduate route are characterized by MAC’s Annual Report 2023 as universities “..that charge the lowest fees” and is “..strongest at the less selective universities.” The report also highlights the University of Hertfordshire and the University of Glasgow as having the largest increase in international student numbers between 2018/19 and 2021/22 but it is clear that their success was for different reasons in different markets.
There is more to be said on the patchwork nature of the university sector as well as on the emerging evidence of slow recovery for commercial pathway operators. That will be the subject of a follow up blog when time allows.
Image by Gerd Altmann from Pixabay