Thirst for cross-cultural experience drives
increased interest in attending university abroad
- The U.S. is the top destination for
university abroad, welcoming over one million international
students
- 42% of parents around the world would
consider a university education abroad for their child – compared
to 35% in 2016 – with parents in Asia the most likely to consider
this
According to new figures released from Higher and higher, HSBC’s
latest report in The Value of Education series, globalization of
higher education shows no sign of stalling. The study of over 8,000
parents across 15 countries and territories found that more than
two-fifths (42%) would consider sending their child to university
abroad, compared to 35% in 2016 – a seven percentage point (pp)
increase.
Asian countries are among the most outward looking, with four of
the top five countries where parents are considering a university
education abroad for their child being India (62%, +15pp),
Indonesia (61%, +1pp), China (59%, +15pp), and Hong Kong (52%,
-2pp). Even countries among the least likely such as Egypt (+26pp),
USA (+14pp), France (+9pp), Canada (+6pp) and Australia (+1pp), see
an uplift in the number of parents considering higher education
abroad.
Country
% of parents from this country who
would consider
university education abroad for their
child
2017 2016 Average 42% 35% UAE 64% 58% India 62% 47%
Indonesia 61% 60% China 59% 44% Hong Kong 52% 54% Malaysia 51% 43%
Singapore 47% 43% USA 43% 29% Mexico 43% 31% Taiwan 37% 38% Egypt
36% 10% Canada 27% 21% France 25% 16% UK 22% 22% Australia 17% 16%
This echoes data from the Organization for Economic Co-operation
and Development (OECD) that highlights that Asian student’s account
for 53% of all students studying abroad worldwide1. According to
HSBC’s partner, the Institute of International Education (IIE),
China is the leading country of origin for international higher
education students, sending an estimated 801,000 abroad, with India
(182,000) and Malaysia (64,000) also exporting significant
numbers.
More generally, student mobility continues to climb with 4.6
million higher education students studying abroad in 2017 compared
with 2.1 million in 2001.
Top destinations for university abroad
Parents see the main benefits of a university education abroad
as being able to help their child gain international work
experience (49%), develop foreign language skills (49%) and to be
exposed to new experiences, ideas and cultures (48%).
Overall, the U.S. (47%) is the most favored destination by
parents, ahead of Australia (40%), the UK (39%), Canada (25%) and
Germany (23%). While parents who preferred the U.S. believe it is a
good destination for job prospects for graduates (86%), those
choosing the UK perceive it as offering high quality universities
and colleges (94%) and parents picking Canada think it offers a
high quality of life for students (83%).
Countries parents are most likely to
consider
for their child’s university education
abroad in 2017
Frequency of mentions
Rank 2017 vs 2016 1. USA
47% = 2. Australia
40% +1 3.
UK 39%
-1 4. Canada 25%
= 5. Germany
23% = 6. France
16% +1 7. Japan
14%
-1 8. Singapore 8%
= 9. China 5%
= 9. Hong Kong
5% +3 9. New Zealand
5% =
The IIE estimates that in 2016/2017, the U.S. attracted around
1,079,000 international higher education students, the UK around
501,000, China 443,000, Australia 328,000 and France 324,000.
In addition, around two-fifths of parents (39%) have specific
universities abroad in mind, attracted mainly by the quality of
teaching on offer, their prestige and their ability to open up new
job opportunities for their child.
“With an intake of over one million, the U.S. has a strong track
record of attracting international students who recognize that a
higher education received there is a valuable personal and
professional investment,” said Rajika Bhandari, Head of Research,
Policy and Practice, IIE. “They particularly appreciate the
importance of critical thinking as well as the broad range of
available resources and the wide variety activities beyond
academics offered by America’s more than 4,000 higher education
institutions. Additionally, specific programs are offered to
international students so they can gain work experience and
ultimately develop their employability skills.”
Cost and value of international education
The majority of parents (73%) considering university abroad for
their child expect to make a significant financial contribution,
and estimate the overall average cost of an undergraduate and
postgraduate degree abroad to be $157,782 ($71,580 for
undergraduate and $86,202 for postgraduate)*. Many parents (45%)
would go further and consider buying a property in the country
where their child is studying.
Parents’ willingness to spend on international education brings
huge potential benefits to the host economies. Research from the
IIE shows that international higher education students contributed
$39.4 billion to the economy in the U.S. in 2016, making it the
fifth largest service sector export.
“Our research points to the growing number of parents ready to
invest in an overseas university for their child’s education and
the substantial investments they are willing to take,” said Pablo
Sanchez, Head of Retail Banking and Wealth Management for HSBC in
the U.S. and Canada. “With an undergraduate’s total cost expected
to be around $72,000 on average, the investment for parents is
financially significant. And, nearly half of the parents surveyed
said they would consider buying a property in their child’s country
of study. While it’s clear parents considering university abroad
expect to make a significant financial contribution, it’s critical
that they plan ahead and look at all of the implications of funding
an international education.”
With the power of its global network, HSBC can support customers
with their international financial needs in four of the top 5
destinations for higher education abroad. Whether it is setting up
a bank account before they arrive in a new country, or welcoming
them to settle in, HSBC offers a package of products and solutions
to ease their journey abroad. In addition, HSBC is partnering with
key players in the education ecosystem – education agencies,
secondary schools, language schools, universities, visa services,
student associations – to provide support to families beyond
banking services.
As an example, the International Education Payment Solution
(IEPS) was launched recently to enable customers in China to make
tuition fees payments directly to schools and universities in
Australia, Canada, Hong Kong, the UK and the U.S. via HSBC Mobile
Banking and WeChat, one of the largest mobile messaging apps in
China.
Practical steps for parents
- Consider the benefits of university
education abroad: It can help your children to be independent and
enhance their job prospects.
- Be realistic about the costs: Make sure
to plan for all the implications including higher tuition fees,
international travel, accommodation, day-to-day expenditure and
exchange rate fluctuations.
- Start planning early: Early planning
and saving for education can help your children fulfill their
potential and limit the strain on family finances. Seeking
professional advice can help you plan and make better informed
choices.
- If buying property abroad: Choose a
mortgage plan that is most suitable for your needs. Consider the
interest rate, repayment period, setting-up fees, early repayment
flexibility and cancellation fees. Be aware of the tax and foreign
exchange implications.
Practical steps for students
- Learn about your new country, its
culture and customs before you go.
- Sign up to classes or training your
university may offer to help you navigate your new
surroundings.
- Speak to recent graduates who studied
aboard, their first-hand experience can help you adapt
quicker.
- Explore your new country and be open to
making new friends.
- Get involved in campus activities
beyond academics, taking advantage of the many clubs, sports,
interest groups and social events to mix with the diverse student
population.
Notes to editors:
* Estimated cost of university education abroad
(methodology)
Parents who would consider university education for their child
in a different country to where they reside were asked to estimate
how much they think it would cost in total each year to fund an
undergraduate and postgraduate degree abroad. They were asked to
consider all expenses associated with their child studying at
university abroad including tuition fees, accommodation, education
books/equipment and food.
These average yearly costs were multiplied by three years for an
undergraduate degree and two years for a postgraduate degree, to
derive the estimated overall cost per country of studying at
university abroad.
The global average cost was calculated by averaging the cost
estimated by each respondent, excluding those from countries where
the sample size was too low.
The exchange rates used are based on the NZForex 2016 average
yearly rate.
The Value of Education
The Value of Education is an independent consumer research study
into global education trends, commissioned by HSBC. Higher and
higher, the fourth report in the series, was published in June 2017
and represents the views of 8,481 parents in 15 countries and
territories around the world: Australia, Canada, China, Egypt,
France, Hong Kong, India, Indonesia, Malaysia, Mexico, Singapore,
Taiwan, UAE, UK and USA.
The findings are based on a sample of parents with at least one
child aged 23 or younger currently (or soon to be) in education,
drawn from nationally representative online panels in each country
or territory. At least 500 parents (including 150 with a child at
university or college), were surveyed in all countries. In the UK,
1,001 parents (including 202 with a child at university or college)
were surveyed. In China, 946 parents (including 504 from the Pearl
River Delta region) were surveyed.
Unless otherwise stated, the survey figures cited in this press
release are based on parents who have a child in either
pre-primary, primary or secondary education and would consider
sending them to university abroad. In some instances, variances
between 2016 vs 2017 data have been shown for information purposes
only and may not represent statistically significant increases /
decreases.
The research was conducted online by Ipsos MORI in February
2017, with interviews in Egypt conducted face-to-face. Read the US
report here.
Institute of International Education (IIE)
HSBC has partnered with the Institute of International Education
(IIE), one of the world’s largest and most experienced
international exchange organizations, which aims to advance
international education and access to education. The IIE has
contributed additional data and insights from multiple sources,
including its annual Open Doors report on international higher
education students coming to the US and Project Atlas – a
collaboration with agencies in other markets to collect equivalent
data. The IIE has also provided researched data from additional
third party sources such as UNESCO and the OECD. Figures reflect
the most recent data available by Project Atlas country and data
partners at the time of publication. For further information on the
IIE and its research, visit: www.iie.org/
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1 OECD Education Indicators in Focus 14, July 2013
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Matt Klein, 212-525-4644matt.klein@us.hsbc.comorSteve Goewey,
212-525-5677stephen.x.goewey@us.hsbc.com
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