Taking note of export earnings

Editor’s note: this is reprinted from the UK Higher Education International Unit‘s most recent newsletter (International Focus issue 48.25.11.09).

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Ahh – the end of the workday and time for a glass of wine: a fine New Zealand Sauvignon Blanc, perhaps?

The first time we heard that education generates more ‘export earnings’ for the New Zealand economy than does wine, we were both knocked off of our seats, and not because we had too many glasses! We were surprised because New Zealand’s white wine industry is world-famous – indeed almost as famous as Australia’s tourism industry. But wait: here too, it is now clear that education exports (ie, the provision of education across a border, either physically or virtually) generate more revenue for the Australian economy than does tourism, and is pegged third after exports of coal and iron ore.

Recent data released by the governments of Canada, the UK and Australia all point to similarly striking figures. In Canada last month, for example, the Department of Foreign Affairs and International Trade noted that international students generated 83,000 jobs, C$291m (£166m) in government revenue, and contributed C$6.5bn (£3.7bn) to the Canadian economy. The last figure is higher than Canada’s earnings for coniferous lumber ($5bn/£2.8) and coal ($6bn/£3.4bn).

In 2007, the British Council estimated the value of education and training exports to the UK economy at nearly £28bn, which is more than the automotive or financial services industries. And just a few days ago, NAFSA, the US-based Association of International Educators, noted that international students and their dependants contributed approximately $17.6bn (£10.5bn) to the US economy in the 2008-09 academic year.

It is increasingly common to hear about such numbers, and more often than not even experts within the higher education sphere are surprised by the significance of the impact of providing international students with an education. Given this, we would like to flag three key issues to think about when faced with these admittedly staggering numbers.

First, it is important to think about why these numbers are being sought at this point in history. We would argue that these numbers are being constituted, and debated about, in the context of an ideological transition – one that increasingly enables views to emerge of higher education as a driver of economic versus cultural-political change. For example, a decade or two ago, it would have been impossible to imagine creating tables such as the one profiled in Kate Geddie’s entry in GlobalHigherEd in which education is measured against ‘scrap plastics’ or ‘chemical woodpulp’. Thus, a new organising logic, to use Saskia Sassen’s phrase, is emerging: one that reframes higher education as an urban/national/global services industry, for good and for bad.

Second, it is worth thinking about the emerging capabilities to generate such analyses. Interestingly, almost all of the analyses have been generated by consultants working on behalf of ministries of education, or ministries of foreign affairs and trade. It is noteworthy that there is little capacity within the state to assess such impacts, so representatives of the state reply upon consultants with track records of studying an array of economic development impacts. Most noteworthy, though, is the increased involvement of ministries, other than education, in the sponsoring of such analyses. Thus, the reframing of education as a service industry is dependent upon a reconfiguration of the responsibilities of ministries for the education sphere, such that ministries of trade, as well as immigration and sometimes foreign affairs, are coming into the picture. This emerging trend has huge implications for the future of the governance of higher education.

Third, there is striking variation in the nature and quality of the analytical models adopted by ministries, and their consultants, in accounting for the economic impact of education exports. Despite our comment above about emerging capacity to assess such impacts, and of the role of more powerful ministries in this analytical exercise, the numbers are not yet comparable (nor, in some cases, trustworthy). For example, should all levels and forms of education be accounted for? Or, to what degree is national support (e.g., research assistantships, fellowships, associate instructors) for foreign students accounted for in the analytical models on offer? These are but two of dozens of questions that could be asked about the numbers that have emerged to date. International comparability is impossible at this point in time, and one has to wonder why this is the case if the sector is so seemingly significant in economic terms.

In closing, the globalisation of education, including higher education, is undeniably creating a diverse array of economic, social, cultural impacts. The export-earnings issue is starting to capture the attention of powerful stakeholders, public and private, for-profit and non-profit. Yet the quality of the analyses to date is patchy at best, and certainly not comparable internationally. Why might this be the case, and what could or should be done about it?

Kris Olds & Susan Robertson

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5 thoughts on “Taking note of export earnings

  1. Pingback: Higher education as an urban/national/global services industry

  2. In response to the question you posed about why analyses of the impact of global education are different and patchy: I know this isn’t really what you were asking, but I have trouble imagining the usefulness of any attempt to quantify the economic values of education. Well, I’ll be more cautious: I’m sure quantification can contribute to the debate. But what about all the complex systems, particular histories, and bio-artistic performances required just to walk down the street, for which we still don’t have much computer time? What about the fact that vocationally-oriented “majors” are time and again proved to be less effective in training students for that very vocation than the liberal arts? How will we quantify the fact that the import of our educations really is lifelong?–it can take us five years to realize the significance of this experience, ten years to realize the significance of that one. To confine policy-making to what can be quantified will only ensure that our
    economies will be deprived of the creativity needed to move them along.

  3. I agree with you Aranye. In the UK at the current time there is an attempt to codify/qualify the ‘impact’ that university research has on the various communities that it might be aimed at. All grants from funding councils will need to build in this dimension – what ever ‘this dimension’ eventually comes to mean. This seems to me to run into the same kinds of difficulties, and hazards, that you have identified concerning the value of education.

  4. Pingback: Is a UK funding crisis needed to spur on the ‘education as a global growth industry’ development agenda? « GlobalHigherEd

  5. Pingback: The economic impact of international students around the world « GlobalHigherEd

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