With New Zealand’s economy becalmed, a fresh wind is blowing in from across the Tasman. The Albanese government’s decision to cap international student numbers has created a potential $2.5 billion-a-year opportunity for New Zealand.
Pre-pandemic, international education was New Zealand’s fifth largest export earner, contributing $3.7 billion annually to our economy. It now languishes in the doldrums, with student numbers at about half their 2019 levels.
As GDP (Gross Domestic Product) growth limps along at 0.2%, policymakers have looked to mining and foreign direct investment to revive our fortunes. Both are important. But neither can quickly boost growth in the way that international education can.
Australia’s decision to cap international student numbers means it is set to jettison $9-10 billion of annual export earnings. If New Zealand could capture just 25% of this market, we would gain an extra $2.5 billion. This would put us back to pre-pandemic levels, beating recovery forecasts by 3-4 years.
The potential for growth is clear. About 2.8% of Australia’s population is now international students. New Zealand lags at 1.1%. When Australia’s new cap takes effect, their ratio will drop to around 2.2%. If we can attract enough international students to reach our pre-pandemic level of about 115,000, we will match Australia’s new ratio - and that could be just the start.
The case for increasing international student numbers in New Zealand is compelling. And not just for the increased export receipts.
International students bring diversity and global perspectives to our campuses and communities. They enrich the educational experience for all students. This fosters cross-cultural understanding and prepares New Zealand students for an increasingly interconnected world.
The economic currents generated by international students flow into every corner of our nation. Homestay families would earn additional income while establishing global connections.
Our struggling polytechnics, private providers and universities would receive a much-needed financial injection. Regional New Zealand would be revitalised by the youth and cultural diversity, countering the ‘brain drain’ to urban centres.
Increasing international student numbers will also help with skill shortages. Many have skills we need in technology, engineering, and healthcare. By providing pathways for these graduates to work in New Zealand post-study, we can help fill crucial gaps in our workforce.
Most importantly for New Zealand’s long-term future, international education creates a vast network of alumni with strong connections to our country. These alumni become unofficial ambassadors for New Zealand in their home countries. They help with international connections for trade, inward foreign direct investment, and tourism. Their positive experiences in New Zealand can translate into a lifelong affinity for our country, our products, and our services.
To seize the opportunity, the government needs to change its approach in three areas: policy settings, operations and marketing.
Getting the policy settings right is critical. The government must address the uncertainty over post-study work rights. International students are unlikely to choose New Zealand if they are unsure about their ability to gain work experience here after graduating. We need clear and attractive post-study work visas, especially in high-demand vocational fields like IT, construction, engineering, aged-care and health.
We should grant post-study work rights to international students who complete qualifications at level 4 of the New Zealand Qualifications Framework or above. The work visa length should match their study time. To encourage regional growth and address skill shortages, we could offer extended visas for those studying outside Auckland or in high-demand fields. This approach would attract talent where we need it most and boost our regions.
We could also consider extending work rights to partners of international students enrolled in bachelor’s degrees and above and increasing the weekly student work hours cap from 20 to 24 hours.
On the ‘operational’ side, Immigration New Zealand needs to streamline the student visa process. It is surely not too much to expect a one-two month processing time, with an option for expedited visas. To achieve this, some investment to boost resourcing and clear application backlogs will be necessary.
As for marketing, if we get the policy and operational settings right, the students will find their way here. A significant increase in Education New Zealand’s budget should not be necessary. However, the government should look to Australia’s smarter marketing approach. Across the Tasman, Austrade (the Australian Trade and Investment Commission) successfully promotes international education and tourism as part of its broader mandate to advance Australia’s trade, investment and education interests.
Crucially, however, we need to shift the perception of international students in our national discourse. Rather than viewing them primarily through the lens of immigration policy, we must recognise them as a valuable source of talent, skills, and economic growth for New Zealand.
With this prompt and these considered steps, New Zealand could capitalise on this shift in the international education landscape. By improving our policies, streamlining our processes, and strategically marketing our strengths, we can not only regain our position as a leading destination for international education but potentially surpass our previous achievements.
While it will not fix all our economic challenges, international education could provide a welcome gust of wind in our sails, helping to nudge our economic prospects in a more promising direction.
To read the full article in the NZ Herald ($) website, click here.