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Study Abroad: Revenue Drain or Stream?

By  Wendy Williamson
October 7, 2010
Study Abroad: Revenue Drain or Stream? 1
Christophe Vorlet for the Chronicle

When it comes to study abroad, university officials must constantly balance their overseas aspirations with the bottom line.

We believe it’s important for students to learn other languages, learn about other cultures and countries, and graduate from college prepared for a global society. Yet we struggle with the “business” of international education. It costs more and more to provide the services students want, a challenge during today’s tight fiscal environment.

On the other hand, many higher-education institutions and others have found ways to generate revenue from study-abroad ventures. The World Bank estimates that $300-billion is spent each year on global higher education, and study-abroad and other international programs are a growing portion of it. The three major sources of revenue are: colleges and universities and their entrepreneurial professors; international institutes and schools; and so-called third-party providers, which offer overseas study programs, student recruitment, or other services.

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When it comes to study abroad, university officials must constantly balance their overseas aspirations with the bottom line.

We believe it’s important for students to learn other languages, learn about other cultures and countries, and graduate from college prepared for a global society. Yet we struggle with the “business” of international education. It costs more and more to provide the services students want, a challenge during today’s tight fiscal environment.

On the other hand, many higher-education institutions and others have found ways to generate revenue from study-abroad ventures. The World Bank estimates that $300-billion is spent each year on global higher education, and study-abroad and other international programs are a growing portion of it. The three major sources of revenue are: colleges and universities and their entrepreneurial professors; international institutes and schools; and so-called third-party providers, which offer overseas study programs, student recruitment, or other services.

I propose that greater cooperation is needed between these parties as budgets shrink. Through creative collaboration and partnering, we can make study abroad affordable for everyone and open the floodgates to participation by undergraduates.

The financial challenges of operating a study-abroad program differ from one college to another.

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Many private universities have found ways to generate a surplus even after direct and indirect costs have been met. They do this by charging full tuition to participate in a study-abroad program, and using a portion of it to support outsourced services on behalf of students and to pay for other expenditures. Their revenue exceeds cost, but they provide top-quality services to students. While this practice is controversial, the universities say that revenues are necessary to keep functioning at the high-level students expect.

The public universities are not as fortunate. Tuition at these institutions is usually not enough to cover study-abroad expenses, and students often cannot afford to pay more than they are already paying for college. What’s more, aside from student-exchange and faculty-led programs, many universities choose to waive their own tuition to help students pay the fee to third-party providers or tuition to the foreign institution. While many public universities have an administrative or universitywide fee to support study-abroad operations, it is usually not enough, and they lose money on every student who studies away.

So the question remains, How can colleges and universities meet the ideals of study abroad without losing money, especially during the economic difficulties and cutbacks that many are facing?

The third-party providers and receiving institutions can do more, like providing support staff and services to the institutions that feed them so many students—and so much money. It’s time that we share more. Instead of asking well-equipped receiving institutions to exclusively admit students who come through them (at a higher price), third-party providers could collaborate with universities to create fewer, “mutually beneficial” niche programs that would generate a more natural flow of students. The revenue from these programs could be shared by all partners and provide ways for faculty members to get involved, as well, helping to internationalize the universities and receiving institutions.

The market for third-party providers started about 20 years ago, with hopes to provide better service to students who study abroad. Before that time, the most common form of programming was student exchange. Without the Internet, it was more difficult for students to directly enroll at receiving institutions overseas. Now, many of the receiving institutions offer full-fledged, professional services to students, and the role of the third-party provider is changing.

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For example, Australearn recently added Eurolearn and Asialearn to its portfolio. International Studies Abroad and Academic Programs International have expanded their operations to the Middle East.

We can’t all set up a branch campus and run our own programs abroad, but we can form better—and fairer—partnerships and collaborations that empower each other and our students. We can also rethink our approach to the “approved programs lists” when there are thousands of academically sound and rigorous study-abroad options to fit any student’s unique goals. It’s time to be less controlling and proprietary, and more collaborative and sharing. Instead of spending time and money leveraging relationships to get on the gatekeepers’ “lists,” third-party providers and host institutions could be working with study-abroad directors and academics to develop programs that meet important learning goals and foster global citizenship.

There are many ways of doing this. Here are three examples:

  • In Faculty-led 360: Guide to Successful Study Abroad (Agapy, 2010), the authors describe a two-way cooperation in which a university in Ukraine offers a substantial discount on student housing in exchange for student lectures in English to local students. Americans earn TESL certificates or ESL endorsements by teaching at a public elementary school and a local orphanage, while Ukrainian students, completing degrees in English translation and interpretation, work alongside the American students as translators, language instructors, and guides.
  • Lorenzo de’ Medici, the Italian International Institute, has its art-restoration and archaeology students work on projects in Italy and around the world. Governments and cultural organizations sponsor students to come to their countries to restore their art and excavate history. Students have worked on convent frescos and marblewood cathedrals in India, paintings in Brazil, bronze sculptures in Argentina, and archaeological excavations in the Mediterranean and Middle East. In Italy, they have restored works from many renowned artists. Professors and students also research restoration, providing real-life solutions to professionals. They have remedied serious problems, such as the large stone statues on Easter Island, which were being destroyed by dangerous lichen. Not only are these international programs paid for, but they benefit students, communities, and humanity, too.
  • The Appalachian College Association, which has 36 members, and the Knowledge Exchange Institute, which runs study-abroad programs worldwide, created a partnership for professors to recruit students and teach programs customized by the institute. This broadens the student pool from about 1,500 students at an individual college to 40,000 across all the member institutions. Faculty members are paid by the Knowledge Exchange Institute for teaching and for successfully recruiting students. The institute also provides a $500 scholarship to each Appalachian College Association student.

These types of creative partnerships can help expand study-abroad opportunities for students. With careful planning, study abroad can be a cost-effective investment that strengthens students’ education, transforms the culture of an institution, and builds a community of global-minded alumni.

Wendy Williamson is director of study abroad at Eastern Illinois University, author of Study Abroad 101 (Agapy, 2004) and co-founder of facultyled.com and AbroadScout.

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We welcome your thoughts and questions about this article. Please email the editors or submit a letter for publication.
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