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The Global Financial Crisis, or GFC as it has been termed in Australia at least, is without doubt the single biggest headline of the year – uncertainty clouded many markets at the beginning of the year as no one knew the impact that the recession would have. Bar some key markets such as the Middle East, the recession appeared to be a global malaise, and indeed, by the year-end, growth was slow, at best, in many outbound markets (see graph).
Indeed, based on forecasts given by close to 300 respondents of the Felca-Gaela Language Travel Industry Barometer, Saudi Arabia was being hailed as the best source of growing enrolments in the first half of the year, with China next (pages 34-36).
The next thorn in the side of industry operators was of course swine flu, or the H1N1 virus as it is referred to in some countries. Fears about swine flu and rampant media coverage in some parts of the world led to many cancellations – notably group bookings from Japan and other parts of Asia, for example. Certain countries were considered hotbeds of the disease and while the epidemic – at the time of writing – never reached hazardous proportions, fears of contracting the treatable virus meant many students preferred to stay at home.
Stormy waters
As a result, it is fair to say that many countries had a difficult year. Those at the top of the list were Malta and Ireland. Malta is heading for a double-digit decline in growth, and the Times of Malta ran the headline “Language schools’ horrible summer” in September. Andrew Mangion, President of Feltom, said the dip was due to reasons including swine flu, the recession, and the exchange rate of the euro versus the low pound sterling.
“This [downturn] could reach as high as –20 per cent in student weeks,” he elaborates. “The third quarter of the year has seen a tough time especially during June and July which traditionally have been very important months for Malta. Drops came primarily in the junior markets although Malta was also hit in the adult markets, primarily from South Korea.”
Ireland also laid the blame for its lacklustre year on the pound sterling, which meant the UK was far more competitive, economically, than its English language teaching neighbour. As David O’Grady, Chief Executive of Irish schools’ association, MEI, wrote in our November issue, “Price was always our trump card… There’s not an awful lot of business out there for Ireland at the moment”. Another Irish school acknowledges 2009 as “one of the toughest that we have had for a long time” (page 39).
One might think that the UK had, therefore, had its best year ever, and while this is certainly the anecdotal report that Language Travel Magazine has heard from some schools, in the main, there continued to be severe frustrations in the British market, as the industry adapted to the new Tier 4 points-based visa system that was introduced at the end of March.
The pound softened the blow of a new visa system that was introduced at a time when visa processing services were being centralised and all Asian applications, for example, were being processed through Manila. Barbara Woodward, International Director of the UK Border Agency (UKBA), acknowledged in a seminar given during the StudyWorld workshop that the timing might have been better managed. As a result of changes in processing and new rules that were not translated consistently by all visa offices, many schools found that groups of students were having their visas rejected for random, incorrect or miscellaneous reasons.
Till Gins, Owner of OISE, said that he had reimbursed UK£500,000 (US$797,448) in fees because of visa refusals this year. “We would have had our best year ever otherwise,” he testifies. “I can’t believe this has not been a bigger story – [visa problems were] damaging a big part of the UK economy.” He gave one example of three Cameroonian students who wanted to come to the UK to study for the third summer in a row. “They were told [by visa officials] that it was cheaper to do an English language course in their own country – that is just insulting.”
So, even if the UK had a reasonable year, many feel that it could have been a lot better. Another gripe is the fact that beginner-level students, defined as level A1, are unable to obtain student visas and can only travel on student visitor visas, limiting their stay to six months with no right to work part-time. This is harming the Saudi market for one, which, as highlighted earlier, is turning out to be one of the best growth stories of 2009. The majority of Saudis enter a country on scholarships issued under the King Abdullah Scholarship Programme, learning English to equip themselves to go on to study at degree level, so there is real long-term benefit to recruiting Saudi students. The USA certainly nods to the Saudis as helping them in what was otherwise a difficult year (see LTM November, page 37).
Success stories
Australia and New Zealand seemed to have the best results of the year, with high levels of optimism in both countries about the latter half of 2009, based on the Felca-Gaela survey. And according to industry leaders in both countries, this optimism is well founded. Rob McKay, Chairperson of English New Zealand, says, “Although schools are showing mixed results we expect the overall results for 2009 to be ahead of 2008. The year started with a weak tone but we hope to make up that lost ground by year-end.”
Likewise, in Australia, Sue Blundell, Chief Executive of English Australia, comments, “The latest statistics we have are for year-to-date July – the only caveat being that they only cover student visa holders – about 60 per cent of overall numbers. Higher education is showing good growth of over 20 per cent. English language training [Elicos] is showing slower growth than 2008 but still good growth of 10 per cent.”
Nevertheless, even in Australia, there were undoubtedly some problems this year, seemingly kickstarted by violence against Indian students in Melbourne that was widely reported in the Indian and Australian press. Australia sent a delegation out to India to try and repair the PR damage done, and questions were asked of the large numbers of Indian students in the country that had led to mounting tensions in some areas.
The upshot of all this has been a complete overhaul of the Esos Act relating to international students and a re-accreditation of all education institutions to ensure that education is their raison d’etre, rather than disguised migration (see LTM, November 2009, page 6). However, by reacting quickly to issues of quality and welfare of students, Australia has again shown itself to be a leader in responsive government of its education export industry.
Pro-active positioning
Other initiatives that Australia has undertaken recently include establishing a scholarship programme between Australia and Hong Kong (see ETM, October 2009, page 19) and Australia and Chile (see LTM, Jan 2009, page 19). However, Australia isn’t the only country to see the value in setting up strong reciprocal education links. In this issue, we report on IIE in the USA meeting with the UAE (see page 19), while in previous issues this year we have mentioned a link-up between China and Russia (ETM, Jan); Ireland and China (ETM, March); Malta and Poland (LTM, April); Malta and Kuwait (ETM, July); and Japan and Qatar (ETM, August).
Meanwhile, there have been reports of Malaysia, India and Thailand all aiming to internationalise their curriculums to attract more overseas students, while Cyprus is also keen to gain a share of the English language teaching pie (see LTM, January 2009, page 8). Clearly, within English language teaching and international education, the competition for students is intensifying.
Focus on regulation
Another initiative that Australia is debating at the moment is one of agent regulation – another outcome of the Indian situation that has led to a call for reform. Quite how education institutions will be expected to manage their agents remains to be seen (see LTM, November, page 6). Meanwhile, Australian association, Acpet – the Australian Council for Private Education and Training – has taken a stance on reliable agencies already by announcing it is creating its own Register of Approved Agents.
Andrew Smith, Chief Executive of Acpet, said that it was not an accreditation system but a “credible and trusted source of information” (see LTM, October, page 6).
Accreditaton has been a focus for education associations too in 2009 – with the UK now being able to boast an accreditation-linked new visa system (for student visas at least), the USA and Canada are noticeably trailing behind their main competitors, the UK and Australia, in terms of a transparent visa regime. (These four markets now are notably the big top four – see our Global Market analysis, November 2009, pages 42-46).
Michelle Alvarez, President of US association UCIEP, told Language Travel Magazine in May, “UCIEP together with the American Association of Intensive English Programs (AAIEP) and other professional organisations worked hard on advocating for the Coleman Action Bill, which would require all English language programmes in the USA to be accredited. In September 2008, these advocacy efforts were visible when the US Senate approved the English language programme accreditation bill. Although it passed the US Senate it was not voted on in the House of Representatives.”
Accreditation continues to be an aim, however, for 2010 and beyond. Jeanne Hind, Immediate Past-President of AAIEP, says, “The main sentiment is that member programmes hope that anything done does not create barriers or undue burdens on students.” She adds, “There continues to be support by some members to seek an accreditation requirement for schools that can accept non-immigrant students, but only if that is tied to ensuring that the US is perceived as a welcoming destination for students.” Hind notes that some programmes also advocate for allowances for short-term language study to be permissible on tourist visas.
In Ireland, the government also took an interest in developing its share of the international education market and mooted a compulsory quality seal for schools, the Q Mark (see LTM, November, page 6).
And the UK took another step towards embedding accreditation into its education system in September when it launched its requirement for overseas schools offering a British education to be accredited and monitored by state authority, Ofsted. UK Parliamentary Under-Secretary of State for Children, Baroness Morgan, said, “Education remains one of our finest exports… all parents will be able to see the inspection report of a British school on an independent inspectorate’s website.”
Technology trends/online ventures
The year also saw an increasing focus on technology used within the industry – tweeting became a recognised term, while Flash mob became a term that may not be universal but is getting better known. CES in Dublin ingeniously devised a Flash mob (a sudden gathering of people in a public place – on this occasion, they were all Irish dancing), and posted it on YouTube – underlining the innovative marketing that some schools and agencies are now using to capture the attention of media-savvy consumers.
In our article on marketing trends this year, Twitter, Facebook, viral marketing campaigns and search engine marketing were all mentioned as options that should be considered by the opportunistic marketeer (see LTM May, pages 28-32).
New breed companies operating solely online continued to pop up too, aiming to utilise the web to operate a new type of company. The two key trends here were companies keen to enable language learning online and those aiming to create online directories of global education opportunties or to enhance booking online.
Pearson announced its partnership with Livemocha, offering paid-for tuition to one of the many online language learning communities that came out of the woodwork this year (see LTM June, page 10). Another company to work with an online social forum was Languages Out There, which teamed up with Italki.com, while more recently, Eurolanguages.com partnered with Spain-based outfit Busuu.com – not to promote online learning this time but to promote to the ready-made audience of keen linguists the possiblity of booking overseas study via its web portal (page 10).
A related trend was the emergence of a number of players keen to become an online global directory for international education. LearnHub and Global Campus were two such companies exhibiting at the annual Nafsa conference this year – Global Campus was new and different in that it wants to use peer reviews of institutions as its unique selling point (see LTM September, page 10). It was also keen to list education agencies on its site – which could also become peer reviewed and therefore quality-rated by users.
Mylanguagetravel.com is another new venture that relies on peer reviews within the language school sector only (see LTM February, page 10).
And the latest such business model is MyGlobalEducation.com, which actually launches in January 2010 (see page 10). It too wants to work with education agencies – by partnering with selected agencies in cities around the world and encouraging students to book via an agency as an alternative to booking with the schools directly (the site will earn a fee either way).
Agents as integral players
Notably, even with the new breed of companies operating only online, education agencies are managing to keep their place at the heart of the distribution chain. A seachange continued to occur in the USA this year towards the use of professional education agents as part of the student recruitment process, with seminars on the subject held at Nafsa and the news that Australia’s IDP and Hobsons both want to help leverage student recruitment in the country (see LTM September, page 8). IDP plans to use its existing network of agencies and recruit US institutions keen to use its promotional services.
“The opportunity is ripe,” said Mark Shay, IDP’s North America Director. “There is almost insatiable demand for an American education, yet the schools are just not investing in what it takes to reach out and really succeed in recruiting in the local market.” Meanwhile, an American group, the American International Recruitment Council (AIRC) – set up by an American university employee originally – began a pilot certification scheme for agencies keen to pay to become “approved” within the USA.
So 2010 looks set to become more quality-aware, in terms of schools’ certification processes, in terms of the integrity of education agencies (in the USA and Australia notably) and because of the continuing use of web 2.0 technology – social comment and forums within websites – throughout the world. It will also be technologically more sophisticated than ever – Pearson’s new PTE Academic exam is using palm vein technology to ensure test security, for example – and more competitive than ever between education destinations.
But the mood is resilient, as summed up by Andrew Mangion, President of Feltom in Malta. He states, “As Churchill said, “We will fight on the beaches and in the air… we will fight at the fairs, in agents’ offices and in new markets, we will fight online and for the media’s attention, we will fight with new products and with accreditation, we will fight for people’s hearts and for their support.”
Brazilian agencies that took part in last month’s Agency Survey were equally optimistic. Despite competitive conditions in Brazil, Erick Andre Garcia, Director at Intercambio Study N Travel, said, “We are very optimistic, [given] Brazil’s economic stability and our personal development with investments in technology and sales staff.” Another agency summed up, “Students are still investing in education.”
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