Is Australian international recruitment showing signs of flagging?

One of the more startling facts delivered at last week's Australian International Education Conference (AIEC) was that there are signs the seemingly unstoppable sector might actually be showing signs of fatigue.

Rather like Sydney's fantastical real estate prices, the international education sector has defied the laws of gravity (and normal market forces) in recent years. Since 2013, the value of international education to the economy has nearly doubled from $17bn (£9.15bn) to $32bn (£17.2bn). It's been the golden goose that keeps laying the golden egg.

And then, suddenly, there appear small but alarming signs that the sector might be undergoing a correction.

Reading the signs

The red flags come when offshore visa applications rather than onshore enrolments are analysed. Chairing a conference session on managing systemic risks to the sector, Navitas's Kadi Taylor told her audience enrolments are a lag indicator while offshore applications are a more real-time gauge of demand.

The startling news for the sector is that for nearly a year now, month on month, there had been declines in the number of visa applications for ELICOS (short-term, English-language courses). Both offshore visa applications and grants for ELICOS were down in the past year, with grants down by 8%. Actual commencements were down by 1%.

For Australia, ELICOS is what is popularly referred to as the canary in the coalmine because it is used by students as a pathway into other longer-term courses in the vocational and HE sectors.

Taylor said it was impossible at this stage to pin down the reasons for this worrying trend.

It could be reputational - Australia's ongoing brittle internal debate about immigration could be impacting on demand. It might be ongoing reports of overseas worker exploitation. It might be declining graduate salaries and employability on returning home. It might be tuition fees, cost of living and concerns over return on investment. It might be that home countries are absorbing more of their own students. It might be that expectations for a valuable international experience are just not being delivered and the student experience - by and large - sucks.

Digging the well

That's the opinion of Jonathan Chew, a principal with the consultancy firm Nous Group, who was also on the panel.

Chew, who was the lead author of a recent report Sustainable Growth in International Higher Education, told the conference that continued growth over the past eight years had lead to a "two speed economy" and distortions in concentration of various ethnicities.

For example, at one prestigious sandstone university, Chew found the the master of accounting degree enrolments were 90% Chinese. At a medium-sized metropolitan university 85% of master of accounting students were Indian.

There are anecdotal tales of students returning to home with poorer English than what they arrived with. This is not good.

Chew said the sector needed to shift its focus to the longer term - or what he called the "digging wells" approach (as opposed the the "turning on the taps" approach). One seeks to think creatively about strategy and diversification, particularly in product offerings. The other seeks to make a quick buck without investment into the long term.

As Chew said, it can be hard for overseas students to get a broad Australian experience which is one of the main reasons they come here in the first place.

Putting out the welcome mat

Meanwhile in another session on Australia's relationship with China, the issue of the Australian experience for international students (or lack thereof) was also on the minds of the panel, as was Australia's rather fractious relationship with China and whether Beijing might pull the plug on student visas in retaliation.

The numbers are huge and growing. As session chairman John Ross from the Times Higher Education noted, at any one time about 1% of Australia's resident population is made up of Chinese students.

The three experts - Richard McGregor from the Lowy Institute, Linda Jakobson from China Matters and James Leibold from La Trobe University - agreed that cutting off or limiting student visas to Australia was probably a very low priority for Beijing.

As McGregor explained, China's enemy number one is Donald Trump and the country doesn't have the time for minor distractions such as Australian anti-Sino sentiments. Besides, despite the brittle rhetoric, Australia is still seen as a safe and friendly place to send students. And, relatively speaking, it's politically friendly. Jakobson noted there was no evidence that Beijing had ever used student visas for economic retaliation, even in fraught situations such as South Korea.

Suggestions for improving the student experience included a national international student weekend in which local families take a student into their home to experience a BBQ, footy, and maybe a trip to the beach. Another was that students should be roomed with a local in halls of residence.

One of the most interesting points in a highly entertaining session was that the Chinese middle class saw student visas - and their potential to be transformed into permanent residency - as an insurance policy should the regime of Xi Jinping become even more repressive.

Meanwhile, Sydney real estate prices are undergoing a reality check and so, potentially, is the international student market.