The United States has long been the leading destination for inbound international students, and U.S. independent schools have benefited from a ready and steady stream of international families seeking a leg up in the college admission process. Two decades of meteoric increases in the number of international students studying in the United States, however, makes it easy to overlook some troubling trends: a decrease in global market share from 28% in 2001 to 22% in 2018, according to Project Atlas data in “Losing Talent: An Economic and Foreign Policy Risk America Can't Ignore,” a NAFSA report; two straight years of declines in new enrollments of international students at U.S. universities, according to the 2018 “Open Doors” report on international educational exchange, published by the Institute of International Education (IIE); and a 2.7% decline between March 2018 and March 2019 in the total number of international students studying in the United States at all levels, according to U.S. Immigration and Customs Enforcement.Today, the international student recruitment and enrollment landscape is more complex than ever. The enrollment pressures exerted on independent schools are significant and come from all sides. Those with the greatest potential to disrupt enrollment patterns in U.S. independent schools are:
- cost, particularly the strength of the U.S. dollar and issues of affordability;
- demographics, specifically the declining numbers of school-age children in traditional sending markets and an over-reliance on students from the same sending countries;
- politics, including concerns about U.S. visa restrictions, post-graduation employment opportunities, perceived safety, and openness to foreigners;
- competition, including from other independent schools, a booming international school market, for-profit schools, and other countries stepping up their efforts to attract international students.
The Downside of a Strong U.S. Dollar
Education in the United States—independent schooling and higher education alike—is more expensive than in any other country, according to the Organisation for Economic Co-operation and Development. For international families, a strong U.S. dollar exacerbates this issue. To illustrate the
point, we converted “typical” tuitions at U.S., Canadian, British, and Australian boarding schools into Chinese yuan (CNY)—and the impact of the strong dollar is readily apparent.Based on these calculations, for example, the four-year price tag of an American boarding school education is $57,608 more than a Canadian boarding school education. One might be quick to downplay the financial impact for well-to-do international families, on whom U.S. schools have typically relied as “full-pay,” but it is important to consider all the variables.
The Enrollment Management Association’s (EMA) most recent survey of families who applied to independent schools reveals that affordability is the No. 1 concern for 44% of international families. And, according to EMA’s state of the independent school admission industry research, 35% of schools are offering financial aid to international students, with boarding schools being much more likely to do so (67%) than day schools (16%). Couple these financial realities with increased competition from in-country school options and the implications of a strong dollar should not be ignored.
Prepare for Abrupt Changes in Cash Flow
In addition to recognizing that affordability is an issue for international families, trustees and heads need to acknowledge that, since many international families typically are full-pay or high-pay, they can be responsible for a disproportionate amount of net tuition revenue (NTR) in schools. School leaders and trustees should understand what percentage of NTR comes from international students and what the impact of a significant shift in one or more key markets might mean for meeting annual tuition revenue goals.Boarding schools seemingly overnight suffered a dramatic shift in the South Korean market post-2008 recession with many schools experiencing an 80% to 90% decline in applications. Considering South Korea was, at the time, the lead sending country for independent schools, the impact of this was significant for schools. The market never recovered. Low birth rate, growth of in-country international schools, and economic challenges have all impacted student flow. If not for the explosion in the China market, this decline in students from Korea would have had a much more significant impact.
Although South Korea remains the No. 3 sending country to U.S. colleges and universities, numbers have declined dramatically since 2008. According to the 2018 “Open Doors” report, there were 75,065 students from South Korea studying in U.S. colleges and universities during the 2008–2009 academic year. In the 2017–2018 academic year, that number dropped to 54,555. Although South Korea is third, the numbers have dropped nearly 30% in the past decade.
Don’t Over-rely on Students from China
When presenting to independent school audiences, whether it be trustees, heads, business officers, or admission leaders, we are almost always asked, “What’s the next China?” Understandably, the appetite for new markets is strong. While new and emerging markets are always out there, none come close to the volume of China.In the early 2000s, China’s population, emerging economy, appetite for English-medium instruction, and shortage of in-country options collectively provided a glut of applicants to independent schools—all of whom were motivated to prepare for college and university in the United States. Today, one-third of all international students in U.S. colleges and universities are from China, according to the 2018 “Open Doors” report. The United States is not alone; students from China make up 30% or more of international enrollments in the U.K., Australia, and Canada as well. The University of Illinois at Urbana-Champaign generated a lot of buzz last fall when it was revealed that the school has a $424,000 annual insurance policy to protect against a loss in NTR from China. This $60 million policy specifically covers the university in the event of trade wars, pandemics, and visa restrictions.
At the secondary level, the percentage of international students from China is even greater—42%, according to IIE’s 2017 “Globally Mobile Youth: Trends in International Secondary Students in the United States, 2013-2016” report. Fifty-six percent of all F-1 visa holders, who intend to earn a diploma, are from China. Schools have become complacent about this market—viewing it as a never-ending pipeline of qualified, tuition-capable students. But this is a risky perspective for many reasons: the declining population of school-age students in China, a direct result of the former one-child policy; the growth of international schools in China that target local students (according to ISC Research, there are 865 international schools in China as of January 2019); competition from other countries; strength of the U.S. dollar; and the education goals of China’s Belt and Road Initiative (BRI).
China’s BRI includes a commitment to improving the quality and capacity of its higher education sector, which will reduce the need for Chinese students to study abroad and is also designed to attract more international students to its campuses. China intends to trade its status as the world’s largest exporter of students to the world’s leading inbound destination. China currently ranks third in the world for incoming international students, boasting a more diverse cohort than is found anywhere else. It is soon expected to surpass the United Kingdom for the second spot. Perhaps the answer to the question, “What’s the next China?” is China … however, as a major competitor.
At present, China has seven universities ranked in the QS World University Rankings’ top 200 and 21 in the top 500. China’s stated goal is to have 42 universities ranked in the top 500 by 2049.
Understand the Impact of Global Politics
U.S. policies and threats under the current administration have increased concern among international applicants, especially in China. The threats to restrict visas for Chinese students in STEM fields combined with threats to limit student visas to one year have caused concern; a Fall 2018 Hot Topics Survey (IIE) of university students who chose not to enroll cited visa delays, U.S. political climate, and selecting another country as the top three reasons. Perceived safety has also grown as a concern for international students and families.At the same time, a growing number of countries have entered into the higher education market with coordinated and well-funded plans to increase the quality of their higher education sector and attract greater numbers of international students. Australia, Canada, China, France, Germany, India, Japan, Netherlands, Russia, and the U.K. have all launched national plans. All of these countries have coordinated immigration, labor, and educational policies to be more attractive to globally mobile students. China, with BRI, is the most systematic and pervasive of all.
Know the Competition
According to IIE, between 2013 and 2016 the number of U.S. schools recruiting inte
rnational students increased from 2,300 to 2,800, an increase of 30%. During this same period, the number of new international students grew by just 8%. In addition, ISC Research reports that during the past two decades, the number of international schools has increased from 2,600 to 10,500. And, their enrollments grew from fewer than 1 million to more than 5 million students, with most of the growth coming from domestic students.While the U.S. has been the leading country developing international branch campuses (IBCs) in higher education, it lags behind the United Kingdom in opening IBCs around the world. It’s concerning that U.S. independent schools continue to view international opportunities in such a singular way: full-pay international students enrolling in our schools. Independent schools such as Chadwick School (CA) and St. Johnsbury Academy (VT) have seized the opportunity to open IBCs in Korea. (See “Sister School” below.)
Appreciate the Challenge of Diversifying
In an ideal world, schools would enroll five or 10 students from every sending country. The reality is far from the ideal. The quality and capacity of students’ home country higher education systems is key to their decision to study far from home. Students from Germany, for example, have access to high-quality, affordable (even free) university education. So, while many German high school students are eager for short-term exchange programs in the United States, few would consider the high cost of college.The desire of independent school boards to diversify their international student population has fueled intense competition between and among independent schools. As a result, we are seeing increased requests for financial aid or scholarships from less populous markets and agents requiring higher commissions to referring schools. The result is increased costs to generate declining revenues.
A key finding of IIE’s 2017 “Globally Mobile Youth” report shows that the vast majority (72%) of all international secondary students studying in the U.S. intend to enroll in U.S. higher education institutions. The value proposition of college-preparatory independent schools is one that resonates with these families. However, the 2018 “Open Doors” report shows a decline in new international student enrollments—for the second year in a row. Fewer students attending college or university in the U.S. is concerning, however, this also presents an opportunity for independent schools: Top-tier colleges and universities will be more inclined to look at independent schools as a top source of international students. Schools that capitalize on this will reinforce their value proposition for international families. It is also incumbent upon schools to focus on college preparation when recruiting students and early in the student experience.
Invest in Your Recruitment Strategy
In June, The Boston Herald and other news outlets covered the impending closure of Pope John XXIII High School, a Boston-area Catholic school, “blaming the company responsible for recruiting and funding international students [for leaving] the school with a million-dollar shortfall.” It has been common practice for schools—particularly day schools new to international recruitment—to outsource recruitment. This example serves as a cautionary tale about relying on a singular source, as well as the importance of understanding and managing these important relationships.We cannot overstate the importance of schools making real investments of people, time, and money in international market development and cultivation. To lead in a particular market, schools will need to understand if, for example, programmatic changes can be made to attract niche markets of international students. In addition, since we know that there is a real connection between U.S. secondary school enrollment and the desire to study at the college and university level, college counseling and preparation needs to begin pre-enrollment. With 72% of secondary students here to prepare for entrance to U.S. colleges, college counseling for international students, including regular and ongoing communication about the process to their parents, should be a high priority.
Robust in-country parent associations need to be cultivated and sustained. Again, this takes time and money but often pays off in terms of word-of-mouth marketing and fundraising. Too often we see schools that do nothing for international families who cannot attend parents’ weekend or parent–teacher conferences. Impeccable customer service for international families (just like for domestic families) should be top of mind.
In this challenging time, admission and enrollment teams cannot be short-changed in their international recruitment efforts. They need the budget and support to not only open new markets but also to sustain primary ones. Going the extra mile for current families is likely the best strategy for a successful international program.
Entering a New Market?
The Enrollment Management Association’s Admission Leadership Council offers advice for boards to consider when looking to enter a new international market:- Do not jump into a new market if you view it as a profit center.
- In each new market, get a contact on the ground, visit the region, and know what your school can manage.
- Spend a year planning and getting to know the territory and its educational system.
- Understand why students from a particular country will benefit from your school and learn about the culture and how you and your school community can support these students.
- Do your research and use your parent/alumni networks as resources.
- Start small by enrolling one or two students the first year. Talk with schools that currently have a program in the country to learn from their successes and failures. Make sure you have a structure for host family recruitment and selection.
- Make sure you have a designated point person on campus responsible for helping international students adjust.
- Send your senior admission officer overseas to visit the countries you’re thinking about.
Sister School
St. Johnsbury Academy (VT) decided to establish a sister school on Jeju Island in the Republic of Korea for many reasons, and so far, the endeavor has been successful. The strategic opportunity to respond to changing enrollment patterns in both domestic and international markets has contributed positively to overall enrollment over the past two years. St. Johnsbury Academy Jeju opened with 450 students (significantly above its first-year goal of 375) in kindergarten through 10th grade and exceeded 600 students during the 2018–2019 school year in pre-K through 12th grade. The school expects to open with 800 students this fall and anticipates reaching its goal of 1,250 students over the next several years.The new school follows St. Johnsbury Academy’s (SJA) model in its mission, curriculum, and culture and has the approval of both the Jeju Provincial Office of Education and the Korean Ministry of Education. The extension of the SJA brand in partnership with the Jeju Development Center, who shared SJA’s values, vision, and mission, has allowed the school to become more prominent in Asia. SJA also saw opportunities for students and faculty on both campuses for shared resources, curriculum, and exchange, and has already enhanced student experiences in both the U.S. and South Korea with a growing exchange program.