How will international student fees be set in Australian universities in 2023?

The complexity of setting prices in international education

Pricing is one of the most important elements of the marketing mix. For international education, pricing is a complex process that involves market conditions, exchange rate fluctuations and the management of large portfolios of education programs with unique characteristics.

The disruption created by COVID-19 is creating additional challenges for Australian universities. In fact, data collected by Studymove shows that 30% of universities have not changed their international fees since 2020.

Analysing international fees

Since 2015, Studymove has captured information on annual international fees across all Australian universities, creating one of the most comprehensive international fee datasets in the sector. Every year, data on 6,000+ undergraduate and postgraduate programs is captured enabling an analysis of trends across all Australian universities. A full report and dataset containing international tuition fees analysis by fields of study or individual program are available for Australian institutions to purchase each year.

This year’s results are particularly useful for understanding the effects of COVID-19 on the pricing position of Australian universities.

During Covid-19, universities stopped increasing international fees

On average, Australian universities increased their annual international fees for undergraduate and postgraduate coursework programs by 5.6% in 2018, 5.1% in 2019% and 4.3% in 2020. In contrast, the average international fee experienced increases of just 2.0% in 2021 and 1.5% in 2022.

Chart 1: Annual average international fee increases, 2018 – 2022 (all universities and study levels)

Source: D Huckel and K Ramirez, 2022 Comparative Analysis of International Tuition Fees in Australia, Studymove Pty Ltd, 2022

In 2022, 20 Australian universities increased their average annual international fees by less than 1%, 15 universities increased their average annual international fees by 2% to 4% and only five universities increased their average annual international fees by more than 4%.

Chart 2: Distribution of annual average international fees increases across Australian universities, 2022 (all universities and study levels)

Source: D Huckel and K Ramirez, 2022 Comparative Analysis of International Tuition Fees in Australia, Studymove Pty Ltd, 2022

Insights by study level

The highest average annual fee recorded for an Australian undergraduate program in 2022 is $49,619 and the lowest $25,757. The highest average annual fee recorded for an Australian undergraduate programs was $49,619 and the lowest $25,757. In 2022, Studymove reviewed 3,942 undergraduate degree programs offered at all 40 Australian universities, including all majors and specialisations. In comparing 2022 and 2021 fees, the average increase was $576 or 1.7%.

The average annual international tuition fee for an Australian postgraduate coursework program in 2022 was $35,879 and the median was $35,053. The highest average value recorded for an Australian postgraduate program in 2022 is $49,595 and the lowest $23,936. In 2022, Studymove reviewed 2,387 Masters by coursework programs offered at all 40 Australian universities, including all majors. In comparing 2022 and 2021 fees, the average increase was $581 or 1.6%.

International fees in a post-COVID world

A combination of new market conditions and international rankings will enable Australian universities to reconsider their international fee strategies for 2023.

Student visa data currently shows a more favourable market outlook for Australia’s higher education sector in 2023 and a positive trend towards recovery.

Chart 3: Primary student visas lodged for higher education, 1 January 2022 – 31 June 2022

Source: This chart uses data from the Department of Home Affairs, Australian Government, June 2022

University rankings are an important factor for many international students and an essential element in the marketing mix of universities globally. After eight years of reviewing international tuition fees for all Australian universities, Studymove has identified a relationship between the international rankings of Australian universities and the average international tuition fee for various programs.

Using the 2022 QS and Times Higher Education World University Rankings and 2022 annual international tuition fees from all Australian universities, we have analysed and plotted the relationship between international ranking and international tuition fees. Overall, the analysis reveals a clear relationship between a higher ranking and a higher average tuition fee for international students. Whilst this may not be a surprise for many international education professionals, what is surprising is how strong the correlation is.

Chart 4 illustrates this relationship by presenting the overall QS ranking of each Australian university and their average annual international tuition fee for undergraduate programs in 2022. Each blue dot indicates the average international tuition fee and overall ranking of each Australian university.

Chart 4: Comparison of QS World University Rankings and average annual international tuition fee for Australian postgraduate programs, 2022

Source: D Huckel and K Ramirez, 2022 Comparative Analysis of International Tuition Fees in Australia, Studymove Pty Ltd, 2022

To measure how strong the relationship is between these two variables, we calculated the correlation coefficient. The correlation coefficient (a value between -1 and +1) reveals how strongly two variables are related to each other.

When the correlation coefficient is close to 1, it means that the relationship between the two variables is very strong. The analysis shows that the correlation for undergraduate programs is (-0.83) and for postgraduate coursework (-0.84).

2023 and beyond

After two years of dealing with a period of unprecedented uncertainty, complexity and confusion, Australian universities, along with other international education providers in Australia, are experiencing a positive trend toward recovery. Careful consideration of international student fees strategies will help universities and all providers to identify new market opportunities and to effectively engage with international applicants. Studymove’s most recent webinar on international student fees is available here.

About the Author

Keri Ramirez is an economist with over 17 years’ experience in international education. He is the Co-founder and Managing Director of Studymove. Keri is also an active member of IEAA’s Data Group under the Research Committee.