Everyone is wondering: what’s going to happen to enrolments in the fall?  Particularly, international enrolments?  It’s a big question because for the last decade pretty much 100% of all the increase in institutional income has come from fee income, much of it from international students.  Take that income away, and we’re talking about major cuts: in Australia, which is only slightly more international fee-dependent than Canada, the hit to the sector this term is estimated at over $5 billion. 

Some may be encouraged by the fact that summer enrolments are actually up.  However, the best guess is that this jump is due mostly domestic students whose work arrangements have fallen through.  There’s not much evidence that we’re going to see a bounce in domestic students for the fall: most estimates I have seen suggest a drop of maybe 5-10%, though if you go by survey data, up to a third of students are at least thinking of skipping a term rather than spend a whole year (shameless plug from the editor: HESA and the Strategic Counsel have some of these survey results for sale—inquire at info@higheredstrategy.com).  And this is probably not so much students taking a “gap year” as it is students who don’t have enough online access to make shelling out a few thousand dollars for a “remote teaching experience” worthwhile. In other words, for those who are cash-constrained or with limited internet, the “value-for-money” question looms much larger.

Let’s turn now to international students.  They are more complicated than domestic students for three reasons.  First, their ability to actually attend a class – whether in person or not – is more varied.  Some current students are in the country now, while others have visas but are outside the country, and *new* students are unlikely to get visas to study (which doesn’t mean they can’t enroll online).  Second, their motivations for study are slightly different: for some, immigration is clearly a goal, which means the “value” of a degree is higher.  And third, they are paying a lot more than domestic students: three or four times as much at most institutions.

So, will they enroll in September?  Some – primarily those who never left the country – almost certainly will.  But among those still in their home countries, it’s a very different story.  The Education Media Group released a survey in early April which suggested that only about 20-25% of new international students would take up an offer to study online (this would be very bad news for Canadian community colleges, which have a fairly high proportion of international students in 1-year programs).  The study also said about half of current students would take up the offer: but since many of them are already in-country, my guess would be that among students who returned home last March/April, the enrolment rate would be pretty close to that for new students – 25% or so. 

(I should note that some more recent surveys, such as this one from Academica, have suggested a lower figure of just 20% of new students refusing online courses, but my hunch is that because they were surveying applicants, this is an undercount because applicants may be reluctant to reveal information that might reasonably cause the institution to which they are applying reject them.  And IDP has put out some numbers which suggest as many as two-thirds would start online as long as they had some assurance about transitioning to face-to-face within six months.)

Now what would this mean in terms of lost income?  For the September term, we’re looking at income drops somewhere in the neighbourhood of $3-billion range across the entire post-secondary education system (it depends a bit on whether you mark off existing 2019 numbers or projected 2020 ones). This is equivalent to about 6% of total PSE operating budgets nationally. 

The issue is whether the students come back in January, and this is where estimates get tricky.  First of all, life has to be safe enough to contemplate going back to face-to-face instruction, which is likely but not certain.  Second of all, governments have to make it possible for large numbers of people – in this case, hundreds of thousands of students – to travel to Canada.  This is less likely, as it depends on the presence of much stricter mass quarantine procedures than the Canadian government seems prepared to administer (but a lot can change in six months).  Third, the government has to be back in the business of handing out visas on the previous scale; fourth, actual student demand has to snap back, and fifth, institutions have to be prepared to take on a larger than usual international entry cohort in January. 

If all that happens, then come the spring this whole financial crisis might just be a bad memory.  The students who were to have started in September 2020 might all show up in January 2021, and if we give them a fall term in winter and a winter term in spring, they’ll be all caught up by September 2021.  And the financial crisis will in fact turn out to be nothing more than a cash flow problem.   Indeed, should the pandemic not yet be under control south of the border by November, or if should Trump get re-elected (don’t rule either out), we might even get an extra enrolment boost.

But that’s the optimistic scenario.  Maybe some of those students who defer choose to go somewhere else; maybe we can’t really compete with Australia for the January intake. Maybe a post-pandemic Depression reduces overall demand for student mobility.  Maybe Canada can’t get its act together on quarantine.  Then we’re into nightmare territory.  $3 billion quickly spirals into $6-7 billion for 2020-2021 and at that point governments might have to start making some tough decisions about whether to let some institutions collapse.

Let’s look at one another scenario.  What happens if the world as a whole is more or less back to normal, and Cheeto Jesus is no longer in the White House?  We know that US institutions have been facing falling enrolment for some time and are facing still larger ones just a few years from now.  So, what if America and its post-secondary institutions actually get their act together?  An awful lot of Canada’s successes in international education have stemmed from the miscues of others – the attacks on international students in Australia a decade ago, the “Trump Bump” of 2016, Agent May’s long and successful career, etc.  What if the pandemic is the key for all those other countries to actually up their game and not hand us international students on a platter anymore?

Bottom-line: there is a world where this all turns out relatively OK for Canadian post-secondary institutions.  But the safer bet is still that international student numbers – and hence institutional income statements – are going to take a couple of years to recover and the intervening period will not be pretty.  And there is an outside chance that the international student gravy-train is actually over and some institutions are going to be facing solvency issues.