Disrupting the international student sausage factory

Australians love sausages but we prefer not to know what goes into them. Australians love the jobs and revenue generated by international students but most have no idea about the process of having them enter the country, and what happens when they are here. The deals we do with agents on and offshore, the deals prospective students and their parents make with agents, the property deals, the palming off of responsibility from the Department of Home Affairs to tertiary institutions and then onto agents – it’s not a pleasant business - but the end product is still consumed.

Australia relies on agents to a much greater extent than other major international education providers. The amount of money Australian institutions pay each year is staggering. Agent commission fees in Australia range from 10 per cent of the first-year full-time international student fee at some Group of Eight institutions to 45-50 per cent of the first year full-time international student fee for a VET qualification in regional VET Colleges. Most universities pay, on average, 15-25 per cent commission rates.

In developing countries where English is not the primary language or language of schooling, student recruitment agencies have become attractive sites for ancillary business models that use the overseas destination to add business lines. Student accommodation providers hook up with major agents and in-country representatives of Australian institutions to bundle up services. This provides an additional commission for recruitment agents. These services also extend to the booming inner city property markets of Australia’s major cities where real estate companies hire space in student recruitment agencies. The Australian permanent residency application process and requirements are met with the combination of time in country as well as money spent on country and property is the simplest way to achieve the points required to secure permanent residency.

Multiple reports have concluded that the reliance on agents means we are not receiving the best qualified students – undoubtedly we sometimes are – but such well credentialed students are sometimes ‘switched’ by agents to different countries with higher academic entry requirements. The ability of students and their parents to pay Australian fees and these ‘additional’ services could quite well determine when a student is strongly encouraged by an agent to choose an Australian capital city university.

But it could all be very different. There is now no need for Australian education institutions to continue to use agents. If there is one thing the current pandemic has shown Australian educators, it is that they cannot continue to lag behind the rest of the economy in the implementation of cost-effective technological solutions that enhance customer experience.

Direct admission, via video calling, is a simple solution and it allows for global diversification of student admissions, lower fees, and the ability therefore for Australia to price itself in to markets other than North and South Asia.

Video technology, admissions chatbots, and an ability for admissions staff to add a lecturer into a student information call in real time: this is just the tip of the possible iceberg. Compliance risks can be largely eliminated when optical and facial recognition technology is adopted for online exams and English testing, and to verify the authenticity of financial documents and education qualifications. These simple and commercially available technologies do not deal with the issue of creating brand awareness for an education institution in another country, but that is also an issue amenable to analytics and automation technologies.

Removing most agents and their many sub-agents from the Australian education scene and replacing them with direct contact with potential students and available technologies also removes risk, extra costs and unseemly practices currently overseen by Australian education institutions. It detangles the permanent residency, property market inflation, and financial due diligence issues that have come about over time by an abrogation or outsourcing of responsibility by government departments and education providers. The ability to seriously cut costs, lower fees and price ourselves into diverse markets and end these twentieth century analog practices is here now and the pandemic provides real urgency to these changes.

Surely the time has come when we should decide what goes into our sausages and quality assure that process ourselves. Agent recruitment and endlessly circulating recruitment staff visiting agents no longer creates revenue and opportunities. Direct recruitment will significantly enhance Australian education’s reputation for quality and help us recruit the very brightest aspiring young scholars to Australia from a diverse range of countries.

Monique Skidmore has been a deputy vice-chancellor international at several Australian universities.

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