Overseas students are getting harder to attract and unis will feel the squeeze

Following California’s example, 43 of the 50 states have cut their higher education budgets, reduced academic salaries or increased tuition fees. Some have done all three.

Prestigious private universities, whose investment incomes have been battered by the recession have also tightened their belts, delaying salary rises, building projects and reducing scholarships.

Public funding of higher education is also being slashed in European countries.

The cuts began in Latvia with reductions of more than 50% and then moved to Italy, Greece, Scotland, Ireland, and seven other EU countries. Belgium, Hungary and Austria have scrapped their university expansion plans.

Australia remains an exception. But higher education is a global enterprise; events in one country inevitably affect others. While the Australian economy is relatively robust, that does not necessarily mean our higher education sector is immune to global change.

For example, austerity in higher education budgets in other countries means that Australian universities can expect greater competition for international students.

International students, who can be charged more than local students and whose numbers are not subject to government-imposed quotas, can be charged high fees to compensate for budget shortfalls.