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Beyond the Economic – How BEYOND THE ECONOMIC – HOW INTERNATIONAL EDUCATION DELIVERS BROAD VALUE FOR NEW ZEALAND MAY 2018 BEYOND THE ECONOMIC – HOW INTERNATIONAL EDUCATION DELIVERS BROAD VALUE FOR NEW ZEALAND PREPARED FOR Education New Zealand PREPARED BY Emanuel Kalafatelis, Corrine de Bonnaire and Louise Alliston. CONTACT DETAILS Emanuel Kalafatelis Research New Zealand Phone 04 499 3088 www.researchnz.com IBSN 978-0-473-43856-2 Beyond the economic • 3 TABLE OF CONTENTS Foreword 5 1.0 Executive summary 6 2.0 The international education sector in New Zealand – an overview 14 2.1 Introduction 16 2.2 The international education sector in New Zealand delivers economic value 16 2.3 New Zealand is an attractive study destination 18 2.4 The sector is rebalancing from volume to value 21 3.0 The value of international education – the overseas experience 24 3.1 Introduction 25 3.2 Benefits to national and regional economies 27 3.3 Benefits to tourism 33 3.4 Benefits to soft diplomacy and international trade 37 3.5 Benefits to business, innovation and the workforce 43 3.6 Benefits of community-based, cultural and educational value 49 4.0 Case studies of New Zealanders’ experiences of international education 56 4.1 Introduction 57 4.2 Community, culture and education 59 4.3 Diplomacy and international trade 67 4.4 Business and innovation 73 4.5 Tourism 81 Appendix A: Glossary 86 Appendix B: Literature scan methodology 87 Appendix C: Literature scan references 90 TABLE OF FIGURES Figure 1: Value of onshore international education by sector to New Zealand 17 ($m), 2013 - 2016 Figure 2: Number of international students by sector 2012 - 2016 18 Figure 3: International students by market, 2012 and 2016 19 Figure 4: Regional distribution of international students 2012-2016 20 Figure 5: 2012 and 2016 sector breakdown 21 4 • Education New Zealand Beyond the economic • 5 FOREWORD I’m pleased to present Beyond the economic – how international education delivers broad value for New Zealand, a new report on the broader contribution that international education makes to New Zealand. While we know international education delivers strong economic results, what is less well known are the other ways in which international education delivers value for our cities, regions, schools, businesses and communities. We commissioned Research New Zealand to scan the existing research on this subject, within New Zealand and overseas. The benefits identified include the opportunity for young New Zealanders to develop the soft skills and cultural awareness they will need in a more globalised future world, for example. To explore these themes further, and demonstrate how they play out in a New Zealand context, we also commissioned a series of case studies. Each case study highlights a different aspect of international education – from the perspective of a school, an engineering business, a New Zealand embassy, and a tourism operation. The four case studies, together with the literature scan, present an interesting picture of international education and the opportunities it offers. They showcase a number of diverse ways in which New Zealanders benefit from international education, and the important, long-term role it plays in building our connections with the wider world. These benefits are in addition to the estimated $4.5 billion economic contribution from international student spending within New Zealand and from education products and services provided offshore. We hope this report will be the start of a much broader discussion about the real contribution of international education. Thank you very much to everyone who took part in this project. Grant McPherson Chief Executive Education New Zealand May 2018 6 • Education New Zealand 1.0 EXECUTIVE SUMMARY This research project was commissioned by Education New Zealand to provide an evidence base for the broader benefits of international education to New Zealand. INTRODUCTION These benefits include community-based and socio-cultural benefits, as well as educational benefits, resulting from the presence of international students in our schools and campuses and in our communities generally (and their families who come to visit), exposing us to different world views and ways of doing and thinking about things, as well as helping us to connect with other countries and regions of the world. It also includes direct and indirect economic benefits, such as filling specialist domestic skills shortages, introducing innovation to New Zealand workplaces, and helping to build New Zealand’s global linkages, as well as tuition fees and other spending by students. The opportunity to grow the international education sector in New Zealand is significant and as such, is reflected in Education New Zealand’s business objectives which include: • increasing the percentage of international students in regions outside Auckland • helping New Zealanders understand the value of international education to our country • encouraging more New Zealanders to spend time studying offshore. THE RESEARCH PROJECT This research study involved two main streams of work which were completed between May and July 2017: 1. The literature scan, which reviewed how other countries value contributions made by international students coming to study in their country. 2. Case studies with New Zealanders who have had actual, first-hand experience of the benefits and contributions made by international students who have come to study in New Zealand. To provide context, a brief overview of the statistical information about the international education sector in New Zealand was also prepared. Beyond the economic • 7 1.0 THE INTERNATIONAL EDUCATION SECTOR IN NEW ZEALAND – AN OVERVIEW The total estimated economic value of This increase was seen in all sectors, the international education sector in except for funded and unfunded New Zealand was estimated at $4.5 PTEs. Based on equivalent fulltime billion in 2016, up from $4.3 billion in student numbers, universities currently 20151. As such, international education account for the most international supports more than an estimated students (21%), followed by ELS (19%) 33,000 jobs in New Zealand. and unfunded PTEs (19%). Most of the total estimated economic By value, the picture is different, value of $4.5 billion is accounted for by with the universities accounting for international students coming to study the largest share of tuition income in in New Zealand ($4.2 billion), with 2016 (37%), followed by ITPs (17%), the remainder ($242 million) resulting secondary schools (14%), funded PTEs from education services delivered (12%) and unfunded PTEs (12%). offshore. Students from China and India made Almost 132,000 international up half of all international enrolments students were enrolled to study in in 2016 (China 29%; India 21%). 2016 in New Zealand schools, English Enrolments from China continue to language schools (ELS), private training grow, while enrolments from India establishments (PTEs), institutes of have dropped slightly since 2015. Most technology and polytechnics (ITPs) international students go to Auckland and universities. This represents an to study (63% in 2016). increase of 6% (or approximately 7,245) on the numbers enrolled in 2015. 1 Education New Zealand (2017). New Zealand international education snapshot: 2016 full year report. Wellington: Education New Zealand. 8 • Education New Zealand 1.0 THE VALUE OF INTERNATIONAL EDUCATION – THE OVERSEAS EXPERIENCE The growth that is being experienced by New Zealand reflects international trends, with the number of internationally mobile students expected to continue growing from about 5 million in 2015 to an estimated 7-8 million by 2025.1 Australia, the United States (US) and the United Kingdom (UK) are currently the three largest providers of international education2, and together with Canada, the literature scan focused on these countries to provide a clear overview of the state of recent research on the benefits of international students to these countries. All five countries have quantitative analyses of the economic contribution of international students to their host country (as does New Zealand). The scan found that Australia, the US and the UK also had significant amounts of research relating to other benefits. Overall, the scan found strong evidence that the international education industry and the tourism activities of international students and their families, directly and indirectly contribute to economic activity and job creation in their host countries. Against this background, outlined below is a summary of these benefits, beginning with those that are of an economic nature: • Benefits to national and regional economies – the international research on the economic benefits of international education typically distinguishes between students’ direct and indirect effects on the host economy. For example, international students’ expenditure and activities directly create jobs in learning institutions and jobs in industry sectors such as accommodation, retail and transportation. On the other hand, an indirect job is “… created and/or supported indirectly from the above direct job’s existence. This is a multiplier effect in which the spending from a directly-supported job will thus help to indirectly create and/or support other jobs in the workplace.”3 A study based on English language centres in the UK found that, in 2014, international English language students’ spending (including tuition fees, accommodation and other living costs) added a net £194 million to government
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