January 15, 2024

How does the influx of international students affect Canadian domestic students?

In recent years, Canada has witnessed a significant surge in the number of international students enrolling in its post-secondary institutions. This influx has raised concerns about its potential impact on domestic student enrolment, sparking debates about the consequences of this trend.

A Tale of Two Trends: International and Domestic Enrolment

From 2010 to 2019, the number of international students enrolled in Canadian public post-secondary institutions skyrocketed from 142,200 to 388,800, representing a nearly threefold increase. This trend has continued, with the total number of international students across all educational levels in Canada exceeding 800,000 today.

While international enrolment has soared, domestic enrolment has experienced a slight decline. This raises concerns about potential competition for limited resources and opportunities between domestic and international students.

An analysis of the relationship by Statistics Canada

A groundbreaking study conducted by Statistics Canada researchers Youjin Choi and Feng Hou examined the relationship between domestic and international student enrolment in Canada. The study analyzed enrolment data from Canadian public post-secondary institutions, focusing on Science, Technology, Engineering, and Mathematics (STEM) and Business, Humanities, Arts, Social Sciences, and Education (BHASE) programs.

Key Findings of the Study

The study looked at enrollment numbers of both international and domestic students at Canadian public post-secondary institutions, with a specific focus on programs in Science, Technology, Engineering, and Mathematics (STEM) and Business, Humanities, Arts, Social Sciences, and Education (BHASE) related programs.

The study found that:

  1. Post-secondary international student enrollment did not have a negative impact on domestic student enrollment at the institution level (among all fields of study).
  2. As more international students enrolled in STEM and BHASE courses, so did more domestic students.
  3. This relationship was even stronger for BHASE programs in post-secondary non-tertiary and short-cycle tertiary programs (programs between secondary and post-secondary levels of education).
  4. There was no correlation between international and domestic student enrollment at the graduate level within STEM programs.
  5. However, there was a statistically significant positive correlation between international and domestic student enrollment in BHASE graduate programs.

The Cross-Subsidization Theory

While the study does not provide definitive explanations for the observed correlations, it introduces the theory of cross-subsidization as a potential explanation.

Cross-subsidization suggests that Canadian educational institutions may utilize international student fees, which are traditionally much higher than domestic student fees, to subsidize the cost of teaching domestic students. This implies that international students are indirectly supporting the education of Canadian students through their increased tuition payments, providing educational institutions with additional resources to reinvest in their schools.

While the study found no direct evidence of cross-subsidization, the results aligned with this hypothesis after controlling for various variables.

Supporting Evidence: Historical Data and Tuition Trends

Further support for the cross-subsidization theory comes from historical data. Between 2010 and 2019, the average tuition fees for international undergraduate students grew by 90.2% (from $16,842 to $32,039 CAD), while domestic student fees increased by only 27% (from $5,146 to $6,580 CAD). These tuition hikes significantly exceeded the 13% increase in the Consumer Price Index during this period.

This data suggests that international students are indeed contributing more financially to Canadian post-secondary institutions compared to domestic students.

Limitations of the Study: Demographic Considerations

While the Statistics Canada study provides valuable insights, it is important to acknowledge its limitations, particularly in the context of Canada's demography.

The study's findings may be specific to the time period examined and could be influenced by demographic changes that occurred during the 2010s. Notably, there was a decrease in the population of young adults aged 18 to 24 from 462,009 in 2008 to 410,851 in 2021. This decline may have contributed to the observed trends in enrollment.

Additionally, reductions in provincial funding for post-secondary institutions may have played a role in the increase in international student enrolment. With fewer resources for domestic students, institutions may have turned to international enrolment to maintain stability.

Looking Ahead: Projected Demographic Trends

Interestingly, demographic trends are projected to reverse in the next 10 years. The population of young adults aged 18 to 24 began to increase in 2021 and is expected to experience rapid growth until 2026, exceeding the level in 2008, the most recent peak. This demographic shift may lead to increased domestic demand for post-secondary

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