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Stewart Watts

“Higher education faces challenges across the globe—from infrastructure to immigration and retention to return on investment. That’s why we’re seeing various initiatives being introduced, including significant investments into technology and content, in a bid to stabilise the sector and meet the evolving needs of the modern learner.”

Stewart Watts
Senior Vice President, EMEA and APAC
D2L

Challenges tertiary education institutions are facing

Recruitment, retention and ROI

Encouraging those just starting their academic careers and lifelong learners to pursue tertiary education is becoming a common goal worldwide. Both Australia and New Zealand are implementing strategies to improve recruitment, retention, and return on investment (ROI) in the higher education sector.

In Australia, the government’s targets to increase the proportion of young people with a tertiary qualification to 40% by 2030, and to ensure 80% of the workforce holds a tertiary qualification by 2050, are driving significant reforms. These changes include initiatives to support students from disadvantaged backgrounds, regional areas and Indigenous communities, ensuring that all Australians have access to high-quality education and training. The Australian Universities Accord Final Report also emphasises the importance of equity and inclusion, recommending an increase to the number of Commonwealth-supported places, enhancing support for under-represented groups, and improving pathways between vocational education and higher education.

Australia and New Zealand are working towards creating a more educated and skilled workforce that can meet the challenges of the future. However, undergraduates face many challenges, including punitive interest rates on student loans, high living costs, and competitive job markets. The Australian Universities Accord Final Report emphasises the need for a holistic approach to student support, including financial assistance, career guidance, and mental health services. Helping students feel confident that they are getting the best possible education and experience is crucial.

40%

of Australian population with tertiary qualification (2030 target)

Icon of a teacher standing in front of class
A group of students reading in the library

80%

of workforce holds tertiary qualification by 2050

Fostering a more inclusive student community

Increasing Indigenous student participation in higher education is a key focus for Australian universities. Research highlights the importance of creating culturally safe environments, engaging with Indigenous communities and providing targeted support services such as mentoring programs and scholarships. These strategies aim to enhance the experience of Indigenous students, ensuring they feel accepted and supported.

New Zealand’s Tertiary Education Strategy emphasises improving educational outcomes for Māori and Pasifika students by reducing barriers to success, strengthening the quality of teaching, and incorporating te reo Māori and tikanga Māori into everyday activities. Initiatives such as the Action Plan for Pacific Education 2020–2030 and Talanoa Ako focus on creating inclusive and equitable educational environments and engaging families and communities to support tertiary students.

Students from lower socio-economic backgrounds often face significant barriers to accessing and succeeding in higher education. In Australia, initiatives such as the Higher Education Participation and Partnerships Program provide targeted support to these students through scholarships, mentoring and academic assistance. In New Zealand, government initiatives aim to reduce educational disparities and support students from low socio-economic backgrounds through tailored programs and resources.

Professor speaking to students in a lecture hall

Icon of someone pointing at whiteboard teaching

A stretched workforce

Staff-to-student ratios in the higher education sector are at a high across ANZ, with the ratio in New Zealand being 1:19.6, the highest since 2016, and 1:22 in Australia.

In Australia, the surge in student numbers has placed significant pressure on existing staff. The high ratios are primarily driven by rapid enrolment, particularly from international students, which has not been matched by a proportional increase in academic staff. Additionally, government resources for higher education have not kept pace with inflation and rising operational costs. Universities have been forced to cut staff and rely more on casual and part-time employees to manage costs, further contributing to the stretched workforce.

In New Zealand, inflation has risen significantly over the past six years, while government funding for universities has not, leading to funding shortfalls and staff reductions. The demand for tertiary education has grown due to population bulges and rising international enrolments, yet staffing levels have not kept pace with this increased demand. These factors collectively impact the quality of education and increase the workload for academic staff, highlighting the urgent need for strategic interventions to address the stretched workforce in higher education institutions.

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Students collaborating together in front of laptop

A resurgence in international student enrolments

Australia has experienced a significant resurgence in international student enrolments. As of December 2024, there was a 15% increase in international student enrolments compared to the same period in 2019. Additionally, commencements reached the highest on record, 12% higher than in December 2019.

Several factors have contributed to this increase, including:

  • the lifting of COVID-19 restrictions and border closures
  • various government initiatives aimed at supporting international education and improving the student experience
  • Australia’s reputation for high academic standards, world-class research and excellent post-study work opportunities

Despite the growth, there are challenges associated with the increase in international student enrolments. The surge in numbers has exacerbated the already tight housing market, leading to increased rental prices. In response to record migration levels, the Australian government announced plans to limit international student enrolments to 270,000 for 2025 to help manage the impact on the housing market and ensure sustainability in the international student sector.