The value of education as an export for Australia is set to boom as the country taps into the soaring growth in demand by international students in Asia and beyond.

With resource exports falling there’s much focus on the Australian export industries that can fill that gap, and it’s looking like education could be the star performer.

After a few years in the doldrums, the sector is booming with record numbers of international students enrolling in Australian universities, colleges and schools.

The international education sector is already Australia’s fourth largest export industry after coal, iron ore, and natural gas. Last year, this added up to an economic contribution of $17.6 billion, according to the Australian Bureau of Statistics, up almost 14 percent on 2013. This translates as $17 billion spent by international students studying and living in Australia and $589 million in offshore earnings from other educational services and royalties including education consultancy services, correspondence courses and services through educational institutions.

International education is driving an estimated 130,000 full-time jobs around Australia, and that number is set to grow.

There’s strong growth across all the different sectors of international education for the first quarter of 2015 with record numbers enrolling in higher education and English language studies.

And it’s that sort of growth that’s predicted to continue. Between 2000 and 2013 the number of internationally mobile higher education students increased from two million to 4.5 million, according to the OECD. That represents growth of 6 percent per annum, a trend forecast to accelerate further over the next decade.

The big question now is not only how Australian institutions can best continue to attract these increasing numbers of international students, but also how to meet the infrastructure demands that the influx brings. And that’s an issue that many Australian cities are now beginning to comprehend as the latest Committee for Melbourne report highlights.

Australia in prime position

Australia’s trade and investment promotion agency, Austrade, is now steering a market development plan, AIE 2025, to guide the future growth of Australia’s international education sector over the next decade. It’s kicked off a national campaign to consult with the education industry about the structure and direction of the plan.

The two key challenges set by Andrew Robb, the Minister for Trade and Investment, are to double the number of international students in Australia to around one million by 2025, and to substantially increase the numbers of people engaged in Australian education offshore to 10 million in that time frame.

Quentin Stevenson-Perks, Assistant General Manager, International Education at Austrade, says that with students from Asia making up more than 50 percent of the mobile higher education students, Australia’s in a prime position to tap into opportunities created by the demand.

“It means Australia is ideally placed to deliver education and training services to the expanding middle classes of Asia and to support Asia’s growing economies into the 21^st century,” he says.

“And there are big economic opportunities for education institutions as well as supporting local businesses, investors and local governments if Australia can achieve these goals.”

Students from Asian countries account for the majority of Australia’s international students with China leading the way, followed by India, Vietnam, South Korea, and Thailand. India particularly is regarded as a key potential growth area for the Australian industry with enrolments up more than 27 percent this year. Last year 151,611 Chinese students were enrolled compared to 62,891 Indians, according to the Department of Education and Training.

Infrastructure growth ahead

Stevenson-Perks says doubling the number of foreign students in Australia by 2025 is highly achievable but it’s the infrastructure demands that present a formidable challenge.

“The world’s demand for education services is growing on average 6 or 7 percent and we see long-term demand, but in a city like Sydney there’s a number of questions including, where are you going to accommodate them? How are you going to transport them? How do we get community engagement? And how do we increase the number of providers to meet the demand?” he says.

“You must have a quality product, that is what’s expected, but now the focus has to encompass the infrastructure that supports that number. How do we build a sustainable market?”

He’s seeing institutions starting to change their thinking about this with more looking at things such as purpose-built accommodation, and companies including Urban Nest focusing on providing accommodation.

“These are the kinds of things the sector needs to be looking at and taking a long-term view on,” he says.

A key opportunity for institutions to tap into the global demand for education will be offshore and blended education models, says Stevenson-Perks. “The world of learning and education is changing incredibly,” he says. “If you think reaching the offshore target is going to be 10 million international students sitting in a classroom, it’s probably not going to happen.

“But already you have programs such as Mathletics, for example, an Australian online tutoring program for schoolchildren; it reports four million licensees in 17,000 schools around the world and high future growth prospects.”

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