The Hidden Costs of Recruiting Abroad

As reported in today’s New York Times, a number of U.S. universities are trying to make up their budget shortfalls by recruiting tuition-paying foreign students, especially from China. At public institutions, the foreign students pay the more expensive out-of-state tuition, usually without the discounts often available to American out-of-state students.  From a budgetary perspective, this makes sense. Higher education is something that we produce that is in demand in China and other countries, and the money the pupils from abroad spend on schooling in this country can help offset our trade deficit, in addition to bringing dollars into individual institutions.

Appealing to international scholars may also become more of a survival strategy for American higher education.  For the past few years, applications to colleges and universities in this country have been increasing due to the “baby boom echo.”  In the 1970s, when people born between the end of World War II and the early sixties were mostly in their teens and twenties, it looked like the nation faced a drastic demographic drop because the baby boomers weren’t producing many children of their own. From about the middle of the 1980s through the 1990s, though, members of the baby boom generation apparently became aware that they were not immortal and that their biological clocks were reaching the time of post-fertility, and they belatedly produced a little boomlet of their own.  The echo will soon fade into the historical distance though, and finding students from around the world may be a way that colleges can fill the spots left by diminishing numbers of young Americans. 

While foreign enrollments may serve the needs of institutions, though, the trend of international recruiting may not be such a good thing for many American students. As I have discussed previously, one of the reasons the costs of higher education have risen so sharply in recent years is that rising enrollments and government subsidization have largely removed constraints on expenses. Having more high paying students from other parts of the world is like having rich people suddenly decide a neighborhood is fashionable, pushing rents and housing prices up. An institution that can find foreign students willing to pay top dollar will have even fewer incentives to bring down costs.

In addition, there are only a finite number of seats in any institution and seats that go to some people cannot go to others. While more spots may become available in the future because of the likely demographic decline, for the present admitting foreign students necessarily means not admitting some U.S. students. Under the practices at most schools today, some categories of students already have structural advantages in admissions. While higher education is under legal direction to avoid openly using quotas, effort to bring in underrepresented minorities, mainly African Americans and Latinos, automatically disadvantage individuals who are not members of underrepresented categories. While the disadvantage unavoidably falls on all those not in the preferred groups, it falls heaviest on Asian Americans, who are overrepresented as a result of high average levels of achievement.

Native born Americans who are not members of preferred groups, then, find themselves caught in a pincer. Some spots go to high-paying foreigners and the native born who belong to putatively disadvantaged groups have the best access to the remaining spots. The competition for the shrinking educational space among other Americans, especially Asian Americans, becomes much more intense.

Within universities, the foreign students and the Americans from underrepresented categories go in two different directions. As a controversial study at Duke University recently indicated, the underrepresented tend to move out of the STEM fields. These, however, seem to be exactly the areas of study that draw many foreign students. It is reasonable to suggest that the admissions pincer may ultimately push American universities toward contributing to an imbalance in training between American-born and native students. While some of the latter may remain in this country, other s will take the skills acquired in this country home with them.