Chinese parents boost the UK’s £20bn higher education market
“Parents in China are expecting to contribute on average £72,738 towards their child’s higher education abroad”
Thinking of international education and the boom in mobile students in the near past, we often think of the students as the drivers of change. And of course they are at the centre of the business – it wouldn’t exist without them – but there is another group that also deserves our attention, writes Trista Sun, global head of international and cross border at HSBC. Parents of mobile students, especially Chinese parents, are key to the international education economy.
Despite many concerns about the international political environment, globalisation of education showed no sign of stalling in 2017, creating vast opportunities for universities around the world. The UK in particular saw strong benefits from this, with international students bringing an estimated £22.6bn to our economy, as revealed by new figures from HEPI. We owe a great deal of this income to ambitious parents in China who are going to great lengths to make their child’s plans for university abroad a reality.
As the second most popular destination after the USA, the UK attracted half a million international students in 2017. According to HSBC’s latest Value of Education study of 8,000 parents across 15 countries, parents in Asian countries in particular appreciate the many assets the UK has to offer. Parents in China see studying at a university in a different country as highly valuable, with 42% of those who would consider university abroad for their child saying they would be most likely to choose a British university. This echoes data from the Institute of International Education, which shows the UK welcomed almost 100,000 Chinese students in 2017.
“Chinese parents face various financial challenges, particularly in setting up bank accounts abroad or transferring money”
At the grass roots level, it’s important to remember that Chinese parents provide much of the financial support to make such a high level of mobility possible. According to our Value of Education report, parents in China are expecting to contribute on average £72,738 towards their child’s higher education abroad. In addition, these parents are the most financially prepared, with 55% saying they fund their child’s education through savings, investments, or insurance, and over two-fifths (43%) through a specific education savings or investment plan – twice the global average.
Although well prepared, Chinese parents and students have to face various challenges with their finances, particularly when it comes to setting up a bank account abroad or transferring money. This seems hard to imagine in the modern digital age! At HSBC, we’re constantly looking for ways to ease their journey through technology. For example, we recently designed and launched a new feature within WeChat, the most popular social media app in China, and the HSBC app that allows Chinese parents to pay tuition fees directly and instantly to UK universities. This has put an end to costly and cumbersome transfer methods that Chinese parents were previously using.
Global companies’ and employers’ interest in international education goes beyond financial matters – for example, into recruitment. At HSBC, we strongly value the benefits of international experience and perceive skills such as cultural awareness and adaptability as crucial for our graduates and high potential employees. These abilities are a fundamental part of our International Managers (IM) program, which provides employees with the opportunity to work across roles in 46 of our markets. Several of our senior leaders, including our forthcoming CEO, John Flint, launched their careers at HSBC through the program.
“The UK welcomed almost 100,000 Chinese students in 2017”
With interest in higher education abroad continuing to grow amongst Chinese parents, there is a significant opportunity to capitalise on this in coming years and make the China-UK flow even stronger. The economic benefits brought by international students are vast, and with parents’ help, we can continue to create a generation of children who appreciate and benefit from the value of learning from diverse cultures.