Listen to a college pitch and you’ll probably hear about transformational opportunities to study abroad. In 2013-2014, according to the most recent data from the Institute of International Education, over 300,000 U.S. college students took advantage of these programs. While this record-high number represents only about 14 percent of total students, the programs’ popularity increases each year. This under-explored topic can lead to a wealth of financial articles.
Look into affordability
Finances play a key role in who studies abroad. The base cost for many overseas programs is actually less than in the U.S. However, the overall cost to students adds up quickly with airfare and visas. And depending on how a school structures its finances, students may not be able to utilize financial aid. The higher cost can be a deterrent. According to the Institute of International Education, most students who study abroad are white and attend four-year colleges. While diversity has grown over the past 10 years, the numbers are still at odds with the racial makeup of most U.S. colleges. Additionally, research shows that students who attend an out-of-state school are more likely to study abroad, a trend influenced by family finances and educational background.
Find the link to the financial crisis
Similar to many other industries, the study abroad market took a dip during the 2007 – 2009 financial crisis. The crisis affected types of students differently, which may provide insight into the overseas academia market itself. While the overall number of students studying abroad declined in 2008, the only year over the last decade to show a decrease, it was quickly offset by a large increase the next year. The number of graduate students studying abroad showed no decrease at all. This might indicate a need to accrue international credentials before hitting the very soft U.S. job market or the fact that some graduate programs provide extra funding for students traveling abroad. Hardest hit by the financial crisis were associate students, whose study abroad numbers declined to near zero and have still not recovered.
Follow the money
The majority of study abroad programs are run not by universities, but by companies specializing in overseas programming. Although overseas program costs may be low, many public universities require students to pay an additional fee. And a growing number of private colleges have begun charging equal tuition for those studying abroad and those at the home school. For example, students enrolled at Kenyon College who study in Munich pay “home tuition,” which is more than double the program’s actual cost. The college pays a portion of that tuition to the study abroad company; in the case of Kenyon, the surplus is put back into its off-campus study program.
This has sparked a debate among students and university administration. Some students say it is unfair to charge for the classes and services of their home university when they are receiving a completely different product overseas. Universities say it is a necessary step to fund study abroad programming and that students receive the benefit of programs that are well vetted, along with guaranteed credit transfer. A 2007 NY Times article exposed other issues in funding such as kickbacks in money or travel from study abroad companies to universities that exclusively promoted their programs.
• Study abroad is on the rise, but not all students are able to participate. Look at the colleges near you and find out who is participating in these programs in relation to the makeup of the school as a whole. This can all be compared to national averages using data from the Institute of International Education. See if affordability is a major issue for the students and if anything is being done to address it.
• Find out if schools have study abroad data through the 2008 financial crisis. Did certain programs remain popular while others suffered? What were the underlying reasons?
• Track the money that students pay for studying abroad. If the university is charging more tuition than the program costs, where is the extra money going? And how do students and administration feel about the issue?