Australian universities have been urged to avoid the mistakes of their UK cousins and abandon unnecessary competition, as they lose the option to grow their way out of financial strife.

In research prepared for the , consultants from the Nous Group have highlighted similarities with the UK ¨C plunging international enrolments, deteriorating domestic participation and a looming decline in the school leaver population ¨C as a ¡°cautionary tale¡± for Australia.

Julie Mercer, head of Nous¡¯ UK office, said Australian universities needed to ¡°fix the roof while the sun is shining¡± rather than allowing crisis to build. She said the higher education sector had become accustomed to ¡°perfect storms on the horizon¡± that ¡°never quite hit the shore¡±.

But the current circumstances are different, Mercer told ÌÇÐÄVlog, because ¡°there are so many¡­storm cells brewing. It¡¯s about being prepared [and] making sure that you learn from your cousins across the pond, and recognise that the time to prepare for the challenges ahead is now.¡±

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Nous said that the proportion of UK 18-year-olds applying for university fell by more than two percentage points between 2022 and 2025, marking a more sustained decline than the temporary slump that followed the 2012 imposition of ?9,000 tuition fees, while the population of 18 year-olds is projected to fall from 841,000 in 2030 to 718,000 in 2041.

Meanwhile, the UK government¡¯s?efforts to reduce foreign student numbers ¡°is working¡±. Overseas student arrivals fell by 72,000 between 2022 and 2024, while the number of accompanying dependants plummeted by 84 per cent.

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Mercer said UK universities¡¯ strategy for coping with their rising costs ¨C steadily increasing their enrolments ¨C was no longer viable. ¡°The music stops; your income starts to drop but your costs are still rising.

¡°The pain¡­we¡¯re seeing in the UK sector at the moment is [a] sort of emergency stop and shift, trying to redeliver on a very different cost base than historically they¡¯ve been able to do.¡±

Australian universities must renew their ¡°scenario planning¡± before they reach the same point, she said. ¡°Don¡¯t assume¡­the plan you¡¯ve got in place will deliver. If it doesn¡¯t, what levers can [you] pull?¡±

Australian-based Nous principal Zac Ashkanasy said universities needed to ¡°think more deeply about their academic mission¡± and question historical ¡°assumptions¡± about ¡°what they decide to teach and¡­research¡±.

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They also needed to stop ¡°faux competition¡± with each other in activities where collaboration was a more economical way of ¡°serving the nation¡¯s interests¡±, from sharing ¡°back-of-house¡± services to forging joint civic engagement plans.

¡°Ninety per cent of employers say that students don¡¯t have the right employability skills,¡± Ashkanasy said. ¡°Why has¡­the Australian university sector [not] got together to have collective industry agreements so that they can¡­share resources and [take] joint accountability for improved student employability outcomes? Why [do] they all [have] their own agreements with each individual industry organisation? It seems a missed opportunity and an inadequate use of resources.¡±

Nous said Australian universities must ¡°reimagine institutional models for a no-growth era¡± and avoid UK-style ¡°optimism bias¡± in their strategic planning. It cited that their tuition income would rise by more than ?5 billion over the four years to 2027-28. ¡°Universities are denying the reality that¡¯s right in their face,¡± Ashkanasy said.

john.ross@timeshighereducation.com