Education delivered offshore worth $171 million

Tertiary Education, Skills and Employment Minister Steven Joyce has today welcomed a report which shows the revenue from New Zealand’s education services delivered offshore rose to $171 million last year, an increase from an estimated $104 million in 2012.

The figure was released today in a report commissioned by Education New Zealand. The report also developed a new methodology showing that the added value, or broader contribution to the economy of education services delivered overseas to the New Zealand economy was $242 million. It does not include the economic value of international students studying in New Zealand.

International education (both onshore and offshore delivery) is New Zealand’s fifth largest export industry. Statistics New Zealand reported onshore education delivery to be worth an estimated $3.1 billion annually as at March 2016 which, combined with education services exports, gives a total estimated value of $3.3 billion. This compares with $3.6 billion for wood exports, our fourth-largest export earner.

“This report provides us with a more reliable measure of the offshore education services sector, and the value it represents to the New Zealand economy,” Mr Joyce says.

The report attributed the increase in value to 20 per cent revenue growth, and to the inclusion of a wider sample of firms and activities (including some outside the education industry) compared with the 2012 survey.

New Zealand’s education services exports are made up of a diverse range of products and services which include consultancy, publishing, educational technology, and the provision of teaching services, qualifications, training and assessment to offshore customers and students. Offshore delivery can be institution or workplace-based and delivered physically or by distance and online delivery.

The Government aims to increase the value of international education to $5 billion by 2025 and, as part of that, to increase education services exports to $500 million.

“There is a huge growth opportunity offshore for New Zealand education providers,” Mr Joyce says. “It is not easy to break through internationally, but a number of highly innovative companies are showing the way.”

“The revenue increase since 2012 show valuable progress is being made towards achieving the Government’s key growth goals for international education.”

The report, “Development and Implementation of a new Valuation Methodology for New Zealand’s Education Services Exports”, was produced by Covec Limited in partnership with Infometrics.

The survey was conducted in February and March with 51 respondents. Three-quarters of respondents said they were part of the education and training industry; while nearly a quarter came from outside the industry.

Other key findings from the survey were that:

• 62 per cent provide traditional teaching and learning materials

• 53 per cent provide education technology services

• 40 per cent provide consultancy services

• 38 per cent deliver by online or distance education

• 20 per cent average growth is expected in the next three years

• direct employment was estimated to be 895, with total employment estimated to be 1,584

• the top markets are Australia, China, US and UK

• important regional markets are the Pacific Islands, Southeast Asia and the Middle East.

“This report provides us with a comprehensive revenue benchmark as well as a robust methodology for measuring the value of educational services exports.”

The report can be found here: http://www.enz.govt.nz/assets/Uploads/New-Valuation-Methodology-for-Education-Service-Exports.pdf