Combined universities income was down just 4.8 per cent last year on 2019 – but the numbers for many were way worse
Frank Larkins and Ian Marshman analyse all the financials in a new paper for the Melbourne Centre for the Study of Higher Education.
They find 30 of 37 universities had lower income, 19 increased expenditure and 23 had an operating surplus (down from 34 in 2019).
And while collective earnings dropped a bare 5 per cent, universities did not save anywhere near that – with expenditure down just 0.3 per cent. Larkins and Marshman attribute this to redundancy costs and institutions spending to support internationals students without work and ineligible for government support.
Where the pain was worst: In proportional per centage terms ANU took the hardest hit, with a 14.9 per cent income decline from 2019, followed by QUT, Swinburne and La Trobe U all down 9 per cent). Overall, times were tougher in Victoria than NSW and Queensland – which Larkins and Marshman attribute to dependence on the international market and length of lockdowns.
Where it wasn’t: the three SA universities all increased earnings, just. Uni Sunshine Coast was up 3.5 per cent, Uni Southern Queensland up 5.5 per cent and Charles Darwin U earnings were 8 per cent higher. But geography is not a sovereign cure – CQU, dependent on internationals, was down nearly 8 per cent
What’s intriguing: is the way losses are inconsistent. Some universities heavily exposed to internationals did badly. Some didn’t – the big five, Uni Queensland, UNSW, Uni Sydney, Uni Melbourne and Monash U, “appear to be ‘in the pack’ rather than out in front in terms of financial impact.” Other universities lost domestic market share.
“This analysis suggests that other factors such as institutional strategy, leadership and nimbleness in risk management have all made a significant contribution to the financial health and well-being of universities in 2020. As part of this, some universities may be more advanced than others in terms of implementing measures designed to reduce employee expenditure to match anticipated declines in student enrolments,” Larkins and Marshman write.
What’s next: This year will be worse than last, with a second year of lower international enrolments and lockdowns in NSW and Victoria. “2021 is now likely to be the proving ground for the strategies and pandemic responses each university has adopted – whether explicitly or implicitly – in the first year of the pandemic,” they conclude.