Home > Publications > Research > International Students > Introduction and Background

International students: Studying and staying on in New Zealand

1. INTRODUCTION AND BACKGROUND

1.1 Introduction

New Zealand's international student population has grown rapidly in recent years, with students coming from an increasingly diverse range of nationalities. Over the last five years, people from more than 180 different nationalities have been granted permits to study in New Zealand. The top 10 source countries account for over 80 percent of all international students.

New Zealand is one of many countries that has experienced rapid growth in international student numbers. For example, a comparative study of admission and retention policies towards foreign students showed that between 2000 and 2005, France and Germany saw a 60% increase in their international student population, while numbers in Australia increased by 120%.[1] The rate of growth that New Zealand experienced over this period (over 170% between 1999/00 and 2004/05) was even greater than that of Australia, although the volume of students coming to New Zealand was less.[2]

In 1997/98, almost 20,000 international students were issued a permit to study in New Zealand. This number increased steadily over the next five years, peaking in 2002/03 with over 85,000 students issued a permit. More recently, however, the number of students coming from New Zealand's main source country, China, has been in decline. Decreasing numbers of Chinese students has had a marked impact on the overall numbers of international students. In contrast to New Zealand, Australia has not experienced the same decrease in international students from China, nor in the total number of student permits issued.[3] Figure 1.1 shows the trend in the number of people issued a permit to study in New Zealand between 1997/98 and 2005/06.

Figure 1.1: People granted student permits between 1997/98 and 2005/06

Figure 1.1: People granted student permits between 1997/98 and 2005/06.
Description of Figure 1.1

Research published by the Ministry of Education (MOE) shows that the volume of young international students (aged 13 years and under) increased rapidly between 1999 (507 enrolments) and 2003 (over 4,300 enrolments). By 2002, 20% of all primary and intermediate schools had at least one international student enrolled.[4] However, MOE has reported that the recent decline in international student numbers has had a significant impact on enrolments in schools and English language training providers.[5]

Enrolments by international students in universities and polytechnics or institutes of technology maintained steady growth between 1998 and 2004. MOE estimated that in 2005, 9% of students enrolled in formal tertiary education were international students, up from 5% in 2000. However, enrolments dropped by 7% between 2004 and 2005, with a corresponding 1.4% decrease in total international tuition fee revenue for tertiary education (approximately $7m).[6]

In 2004, the government announced a significant commitment to supporting international education. This commitment was increased in April 2005, bringing the government's investment in international education to over $70 million over the five years beginning June 2004.[7]

Export education is estimated to contribute over two billion dollars annually in foreign exchange to New Zealand[8], and has become the country's fourth largest export industry.[9] In addition to the financial gain from student migration, host countries stand to benefit from the improvement of political and economic relations with sending countries.[10] Researchers also argue that the quality of education improves as international students contribute to knowledge creation and transfer, and educational institutions are forced to provide high quality, competitive services.[11] In New Zealand, international students can also play an important role in the labour market through their labour participation post-study, particularly if they are qualified, and gain employment in, areas of skills shortage.

People in New Zealand on temporary permits are often well placed to become permanent residents. It is increasingly accepted that linking temporary immigration policy with residence policy can have significant benefits for both migrants and New Zealand. People who come to New Zealand to study are usually young, and have the potential to offer employers recognised New Zealand qualifications at the completion of their studies.

Internationally, foreign students have become an increasingly important target of immigration policies that aim to attract and retain talented migrants.[12] For many students, the prospect of gaining residence in the host country plays a role in their decision to study abroad.[13] Over the last few years, many countries have introduced measures that encourage students to work and settle in their host country. In July 2005, a number of student policy changes strengthened the link between study and work in New Zealand, and the purpose of New Zealand's student policy was amended to focus on attracting and developing students who have the skills and talent New Zealand needs.

New Zealand's student policy changes (detailed below) were intended to facilitate the transition from study to work and residence by creating more opportunities to work while studying, and allowing greater access to work permits post study. While there are no specific residence policies for international students, people applying for residence through the Skilled Migrant Category can gain bonus points if they have a recognised New Zealand qualification and at least two years study in New Zealand.

1.2 Student immigration policy

The objective of student immigration policy is to facilitate the entry of foreign students with a focus on attracting and developing students who have the skills and talent New Zealand needs. International students attending courses lasting over three months must apply for a student visa before travelling to New Zealand. Students from a visa waiver country may apply for a student permit in New Zealand. Non-NZ residents are not required to obtain a student permit to attend a course for three months or less.

In 2005/06 a number of policy changes came into effect. The aim of these changes was to make New Zealand a more competitive destination for international students by easing the work restrictions for students and their partners. Since July 2005:

In 2005/06, almost 4,500 students were issued the Graduate Job Search work permit. Applicants are not required to have a job offer for this permit, but must have completed a New Zealand qualification that would qualify for points under the SMC, and must apply within three months of the end date of their student permit for that qualification. Eighty-three percent of students issued this work permit were Chinese.

A further 1,135 people were issued a two-year work permit to obtain practical experience suitable to their course or qualification. Applicants for this work permit type must have completed a minimum three-year course or completed a qualification that would qualify for points under the SMC, and must have a job offer relevant to their course of study.

Recent trends have indicated an increasing number of SMC principal applicants claiming points for having a New Zealand qualification.[14] Many of these principal applicants are young, Chinese graduates from New Zealand's universities. In 2005/06, 17 percent of approved SMC principal applicants gained points for a recognised New Zealand qualification, up from 10 percent the previous year.

1.3 Research objectives

This research is an exploratory study to examine the pathways international students take through the New Zealand education system and their subsequent transition to work or permanent residence in New Zealand. The specific objectives of the research are to undertake an analysis of administrative data to:

1.4 Related research

In June 2005, the Australian Education International (AEI) examined the educational sector pathways followed by people studying in Australia on a student visa.[15] The study examined a cohort of international students who commenced study in Australia in 2002, and tracked their sector pathways between 2002 and 2004.

The study found that two-thirds of the entry cohort were enrolled in a single sector over the three year analysis period. A large proportion of the 2002 single sector cohort were in Higher Education. The ELICOS sector (English Language Intensive Courses for Overseas Students) accounted for 17% of students and the school sector comprised 7%.[16] The most common nationality amongst single sector students in the 2002 cohort was the USA (13%), followed by Malaysia, China, and Japan (8% each).

Of the multiple sector students in the AEI study, 23% followed the ELICOS - Higher Education pathway. A further 17% followed the ELICOS - Vocational Education and Training (VET) pathway.[17] Students from China made up 31% of all multiple sector students, followed by Hong Kong (11%), Thailand (9%), and Indonesia (8%). The most common sectoral pathways differed for each of the main nationalities.

A recent study that interviewed 80 Chinese international students in New Zealand showed that the majority (74%) were multiple sector students.[18] English language studies was the most common starting point for students when they first arrived in New Zealand. Seventy-eight percent of students in this research began their study in New Zealand in the English language sector. Forty-two percent of multiple sector students followed a pathway from English language studies to university.

1.4.1 New Zealand evidence of migrant transition patterns

Since 2000/01, the Department of Labour has monitored the links between temporary migration and permanent residence in New Zealand.[19] Analysis of administrative data has shown that a growing number of people approved for permanent residence have had prior experience in New Zealand as a visitor, student, or temporary worker. In 2005/06, 87 percent of principal applicants approved for residence had previously been in New Zealand as a temporary worker, student, or visitor.

The Department of Labour's research also monitors the rate at which international students transition to permanent residence. Over 20 percent of student permit holders gain permanent residence in New Zealand. The transition rate is typically much higher for dependent students than it is for fee paying tertiary students. In general, the rate of transition to residence for students is lower than it is for work permit holders, and students tend to take longer to make the transition.

Much of the Department of Labour's monitoring work to date has focused on the demographic characteristics of international students, their permit category, and their take up of permanent residence. This research takes a more detailed approach, identifying the pathways that international students take through New Zealand's educational system, and the links between study, work, and permanent residence.

In 2004, the Ministry of Education commissioned a national survey of the experiences of international students in New Zealand.[20] Of the 2,736 students in the study, 53% planned to remain in New Zealand after their current course of studies. Some planned to continue their studies in New Zealand, others planned to look for work. Forty-two percent of students indicated that they planned to apply for permanent residence in New Zealand. Students who wanted to gain residence in New Zealand shared some common characteristics. They had often been in New Zealand longer than other students, and intended to further their study here. They were also older, often Chinese, had better language proficiency, and generally had favourable experiences in New Zealand.

The study of Chinese students (discussed above) found that the intention to stay in New Zealand following study was high, and increased after they had arrived in New Zealand.[21] Of the 80 students interviewed, 71% (56 students) planned to look for work in New Zealand after they completed their studies. Sixty-eight percent (54 students) planned to apply for permanent residence. In both cases, the proportion of students intending to stay on after their studies was greater at the time of interview in New Zealand than it was prior to their arrival in New Zealand.

1.4.2 International evidence of student retention

New Zealand is one of only a few countries that has produced statistics on how many international students remain in the country. While other host countries produce a range of statistics on foreign students and people granted permanent residence, it is difficult to make strong comparisons with New Zealand. There are two ways of comparing New Zealand data with other countries. The first is to calculate a retention rate, which is the proportion of international students who gain residence in the country, ideally by cohort. The second comparison is to calculate the proportion of residence approvals who were formerly students in the host country.

Table 1.1 shows comparative data between New Zealand and several other host countries. However, the retention rates should be treated with some caution. There are differences between the student populations reported by the various countries, which limits any direct comparisons being made. The figures showing the proportion of residence approvals who were formerly students is also indicative only. For example, the Australian data includes dependents (secondary applicants), whereas the New Zealand data only counts principal applicants.

Table 1-1: International student retention rates by host country
Country Retention rate Proportion of residence approvals
New Zealand* At least 20% of international students gain permanent residence within 5 years of their first student permit In 04/05, 10% of Skilled Migrant Category principal applicants claimed points for a New Zealand qualification. In 05/06 this figure was 17%
Australia Approximately 24% of international students who completed their course in 2002 gained permanent residence** In 05/06, approximately 19% of residence visas granted through the General Skilled Migration Programme were to former international students***
Canada**** Approximately 15-20% of international students settle and work in Canada
UK**** An annual survey of European Union domiciled students has shown that 19-27% were employed in the UK six months after graduation In 2005, an estimated 2-5% of Highly Skilled Migrant Programme approvals were international students at the time of application
USA**** Estimated that 58% of international students who received a doctorate from a US university in 1993 were still in the country 10 years later

* Merwood, 2006: Migration Trends 2005/2006. Department of Labour. Wellington.

** Birrell, 2005: Immigration rules and the overseas student market in Australia. Report prepared fro the IDP.

*** DIMA, (2007): Population Flows: Immigration Aspects. Department of Immigration and Multicultural Affairs (DIMA).

**** Suter & Jandl, 2006: Comparative study on policies towards foreign graduates - Study on Admission and Retention Policies towards Foreign Students in Industrialised Countries. International Centre of Migration Policy Development (ICMPD), Vienna.

1.5 Structure of the report


[1] Suter, B. & Jandl, M. (2006): Comparative study on policies towards foreign graduates – Study on Admission and Retention Policies towards Foreign Students in Industrialised Countries. International Centre of Migration Policy Development (ICMPD), Vienna.

[2] The number of people approved to study in New Zealand increased from 28,545 in 1999/00 to 77,563 in 2004/05.

[3] Department of Immigration and Citizenship (DIAC), 2006: Student Visa Statistics. Accessed online, March 2007. http://www.immi.gov.au/media/statistics/study/index.htm.

[4] Ministry of Education, 2003: Report on Research into the Circumstances of Very Young International Students in New Zealand. International Policy and Development Unit. Ministry of Education.

[5] Ministry of Education, 2005: The New Zealand International Education Sector. Trends from 1999 to 2004.

[6] Ministry of Education, 2006: State of Education in New Zealand 2006. Strategy and System Performance. Ministry of Education.

[7] One such initiative included funding to lower the cost of study for international PhD students (to domestic fee levels) and to allow the dependent children of PhD students to attend school without paying international school fees. These changes came into effect for PhD students (and their dependent children) in January 2006. Since May 2006, dependent children of New Zealand citizens or residents who are applying for citizenship or residence have had domestic student status.

[8] Infometrics (2006): The Economic impacts of Foreign Fee-Paying Students.

[9] Minister for Tertiary Education: Media statement, 17 August 2006.

[10] Suter & Jandl, 2006: Comparative study on policies towards foreign graduates – Study on Admission and Retention Policies towards Foreign Students in Industrialised Countries. International Centre of Migration Policy Development (ICMPD), Vienna.

[11] Ibid, p.9.

[12] Suter & Jandl, 2006: Comparative study on policies towards foreign graduates – Study on Admission and Retention Policies towards Foreign Students in Industrialised Countries. International Centre of Migration Policy Development (ICMPD), Vienna. Birrell, Hawthorne, & Richardson, 2006: Evaluation of the General Skilled Migration Categories. Online: http://www.immi.gov.au/media/publications/research/gsm-report/TitleandContents.pdf

[13] Ward & Masgoret, 2004: The Experiences of International Students in New Zealand. Report on the results of the national survey. Ministry of Education. Wellington.

[14] Merwood, 2006: Migration Trends 2005/06. Department of Labour. Wellington.

[15] Australian Education International (2005): Study pathways of international students in Australia.

[16] Australia’s ELICOS sector is equivalent to New Zealand’s English language sector.

[17] Vocational Education and Training (VET). VET is a national Australian system designed to skill workers to work in particular industries such as plumbing, or retail.

[18] Ho, Li, Cooper & Holmes, 2007: The Experiences of Chinese International Students in New Zealand. Education New Zealand.

[19] Merwood, 2006: Migration Trends 2005/2006. Department of Labour. Wellington.

[20] Ward & Masgoret, 2004: The Experiences of International Students in New Zealand. Report on the results of the national survey. Ministry of Education. Wellington.

[21] Ho, Li, Cooper & Holmes, 2007: The Experiences of Chinese International Students in New Zealand. Education New Zealand.