It’s no secret that China dominates the world market when it comes to sending students abroad.  About 20% of all globally-mobile students are from China; in countries like the US, Canada, and the UK, they are far and away the number one source of foreign students.  (In all three countries, Chinese students account for as many foreign students as the next four source countries combined.)

Now every once in awhile – more and more frequently these days – you get some bad economic data from China, and everybody wants to be the first person to predict the coming “China Crisis”: oh Dear Lord, Chinese students are going to disappear, how will everyone cope?

To which I say: chill.  The Chinese market isn’t going anywhere, at least not for economic reasons.

If the argument is that China’s financial turmoil might lower Chinese incomes, and therefore reduce the affordability of foreign education, you need to keep in mind that Chinese families don’t fund education the way we do.  They save.  A lot.  For years.  Unlike North American families, Chinese families don’t try to make things work using their current incomes.  And so unless Zhounior’s savings were fully invested in the Shanghai stock-exchange just before the crash, some short-term economic instability isn’t going to matter that much.

And if things get worse?  What if financial instability leads to political instability?  I’d say that’s more likely to lead to an increase in study abroad rather than a decrease.  For wealthy Chinese families, sending students abroad for their education is at least as much about giving kids a foot in the door for emigration as it is a tool with which to advance their careers in China.  Having your kid in a foreign university is a hedge against precisely this kind of political uncertainty.

Now, this doesn’t mean the Chinese market is impervious to decline.  The fall in the size of the Chinese university-age cohort still matters, but that’s a long-term phenomenon, not a short-term one.  The troubles that graduates have in the labour market is real, and is affecting the composition of demand for higher education.  But remember: the proportion of Chinese undergraduates who choose to study abroad every year is 1-2% of the total.  What happens in that 1-2% market is only barely related to what goes on in the mass market.  It’s like trying to guess what’s going on with Mercedes-Benz sales from the sale of Toyota Corollas. The “mass market” looks nothing like the “elite market”.

The single thing that would most disrupt the flow of students out of China would be a sudden and noticeable increase in the availability of enrolment places at prestigious domestic institutions.  That is, either the big prestigious institutions could expand, or new institutions could join the ranks of the elite; either would reduce the demand for foreign education.  But the former flat-out isn’t happening; and the latter, while not impossible, seems unlikely under present circumstances.

In short, there are solid reasons to prepare for an eventual cresting of demand from China.  But the prospect in the short-term of a bursting of the Chinese student “bubble” is less convincing.  Plan accordingly.