Does international student enrolment impact domestic students in Canada?

From 2010 to 2019, the number of international students enrolled at a Canadian public post-secondary institution increased dramatically from 142,200 to 388,800 international students. Today, counting international students at all levels of study, that number is over 800,000.

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This surge in the international student population can raise concerns about domestic student enrolment within Canada—will Canadian students suffer due to the large influx of foreign students; and could this further negatively impact international student enrolment in the future?

A study released by Statistics Canada seems to suggest the opposite. In a comparison of post-secondary enrolment trends between domestic and international students, researchers Youjin Choi and Feng Hou uncovered a positive relationship between domestic and international student enrolment at Canadian institutions, with some interesting findings along the way.

The study looked at enrolment numbers of both international and domestic students at Canadian public, post-secondary institutions—with specific emphasis on programs in Science, Technology, Engineering and Mathematics (STEM), and Business, Humanities, Arts, Social Sciences, and Education (BHASE) related programs. For the purposes of this study BHASE programs also included legal studies, trades, services, natural resources and conservation related programs as well.

The study looked to assess the impact of international student enrolment on domestic students, after controlling for a number of other variables referred to as “institution characteristics and time effects”—for example a change in program, admissions standards, enrolment capacity, etc.

Results

The broad finding of the study was post-secondary international student enrolment did not have an impact on domestic student enrolment at the institution level (among all fields of study).

However, when looking at STEM and BHASE programs, the study found a positive correlation between both groups in both instances: as more international students enrolled in STEM and BHASE courses, so did more domestic students. This relationship was even stronger for BHASE programs in post-secondary non-tertiary, and short-cycle tertiary programs (programs between secondary and post-secondary levels of education)—where an increase in international student enrolment in BHASE programs correlated with an institution wide increase in domestic students.

Lastly, the study found no correlation between international and domestic student enrolment at the graduate level within STEM programs; however, noticed a statistically significant positive correlation between international and domestic student enrolment in BHASE graduate programs.

These results are especially insightful given that as an overall trend, the number of domestic Canadian students enrolled in post-secondary education has decreased slightly, whereas the number of international student enrolments at the same level of study have close to tripled in the same ten-year period. In fact, enrolment of international students has increased across every educational level and program that was measured by this study.

Why might this be the case?

While the study cannot give us much in the way of reasoning behind the results, it does introduce a theory to explain the positive correlation between international and domestic student enrolment in STEM and BHASE fields.

This is the theory of cross-subsidisation—the idea that educational institutions in Canada may use international student fees (which traditionally are much higher than domestic student fees in Canada) to subsidize the cost of teaching domestic students. In this theory, international students enable the education of Canadian students, as they pay increased tuition fees for the same educational services, further giving educational institutions more money to reinvest into the schools. Importantly, while the study found no evidence of this cross-subsidisation, results after controlling for variables were consistent with this hypothesis.

Cross-subsidisation is further supported by historical data. Between 2010 to 2019, average tuition fees for international undergraduate students grew by 90.2% (from $16,842 to $32,039 CAD)—in this same time period domestic student fees increased by only 27% (from $5,146 to $6,580 CAD). Both of these tuition hikes happened at rates that far exceeded the 13% increase in prices of goods and services due to inflation in this time period (as measured by the Consumer Price Index).

Given the data at hand, it does not seem likely that international student enrolment will be impacted by domestic student enrolment (or vice-versa), should the trends in this study hold. There are, however, limitations of this study that should be noted.

Limitations of the study

While important in contributing to research on the topic, there are limitations within the study to consider, particularly when considering Canada’s demography.

For instance, the results explored may only be relevant to the specific time period covered by the study and could be influenced by demographic changes that occurred during the 2010s. Notably, there was a decrease in the population of young adults aged 18 to 24 from 462,009 in 2008 to 410,851 in 2021, according to Statistics Canada. This decline was primarily due to a decrease in the number of births in the 1990s and early 2000s (Statistics Canada, 2022f). As a result, there was a decrease in domestic demand for postsecondary programs, which created an opportunity for international students to fill these seats.

Another factor that may have contributed to the decrease in domestic student enrolment is the reduction of provincial funding in departmental budgets, since domestic student enrolments receive subsidies from provincial funding. Due to these demographic changes, postsecondary institutions may have needed to increase their enrolment of international students, which they were able to do without reducing domestic enrolments.

However, demographic trends are projected to be the opposite in the next 10 years. The population of young adults aged 18 to 24 began to increase in 2021 and is projected to experience rapid growth until 2026, exceeding the level in 2008 (the most recent peak). This demographic change may lead to increased domestic demand for postsecondary education in the next decade if the tendency for Canadian young adults to participate in postsecondary education holds. Consequently, there may be a shift in the underlying relationship between changes in enrolments of domestic and international students in the next decade.

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