Economic impact of international education in Canada – 2017 update

Appendix 1 - Detailed explanation of data sources and adjustments

Number of international students

As noted in Section 2, Data sources and methodology, a comprehensive data set representing “internationally mobile students” in Canada cannot be found in existing data sources. Therefore, we sought an alternate data set: the number of “foreign students” as a proxy to represent international students in Canada.

IRCC defines foreign students as follows:

Temporary residents who entered Canada mainly to study and have been issued a study permit (with or without other types of permits). A study permit is an official document issued by an officer that allows someone who is not a Canadian citizen or a permanent resident to study in Canada. In general, a study permit is not needed for any program of study that is six months or less. For statistical purposes, a temporary resident is designated as a foreign student on the basis of IRCC’s determination of his or her “yearly status” – the main reason for which the person has been authorized to enter and stay temporarily in Canada during the year of observation. Foreign students exclude temporary residents who have been issued a study permit but who entered Canada mainly for reasons other than study.

There are three broad levels of study for foreign students.

  1. Secondary or less: secondary school and elementary school
  2. Post-Secondary: which is further divided into
    • CEGEP
    • College education
    • University education
    • Others
  3. Other Studies

The IRCC data therefore allows us to use the number of study permit holders as a proxy for the number of international students at a given time in a year. It also allows for a distinction to be made between broad levels of study.

One limitation of using the IRCC data set to represent the number of international students is that the actual number of permit holders registered at a Canadian institution may be smaller than the number of permits issued due to the fact that some permit holders may not be able to, or have chosen not to, enrol in an education program.

One of the adjustments we have made includes removing a portion of student permit holders in the “secondary or less” category, who are assumed to be children whose parents are enrolled in some post-secondary education program. The adjustment is based on industry information, as reported in the 2015 ICG report for CAPS-I.

These students have been further allocated to studying in public or independent K-12 school systems based on industry intelligence.

The allocation of student permit holders in the post-secondary system to finer categories of trade, college, under-graduate, master’s, PhD and other type of programs is based on IRCC information and data in Statistics Canada’s CANSIM data series (Table 477-0019).

Further allocation of registration status in full-time and part-time study for each type of students has been based on Statistics Canada’s CANSIM data series (Table 477-0019).

Finally, another important source of international students that is not covered in the IRCC data is the number of students who study in Canada for periods of less than six months, as they do not require a study permit to enter the country. In this regard, Languages Canada collects data that is useful for our purposes.

Languages Canada administers an annual survey with its member schools to collect data on such topics as the source of students, immigration status, the length of study, the students’ average weekly spending and other variables. On Languages Canada’s advice, we sought data related to international students studying in its private membership schools only, as the number of those studying in its public membership schools would have been represented in IRCC’s dataset.
We made further adjustments to calculate the average number of student‑weeks for students studying for up to six months in each province and territory.

It should be noted that at the time this report was being prepared, no detailed information on short-term students, as represented by the number of students in Languages Canada’s membership schools, was available for 2016. The number of short-term students in 2016 was estimated, based on the annual percentage increase of Languages Canada membership students between 2014 and 2015. It should be noted that since the completion of this report, Languages Canada has released the 2016 data and our estimates of the number of short-term students were slightly higher (2%).[29]

Student expenditure

Tuition and fees

For tuition and other fees at the K-12 level, we relied on information published in the CAPS-I report. Note that these are based on tuition and fees in a school year (10 months). Tuition and fees in private schools can be substantially higher. In this regard, we also used information available from the CAPS-I report to calculate the average annual tuition and fees for international students in private schools.

Detailed information on tuition and fees for full-time university-level international students in each province is available in Statistics Canada’s annual Tuition and Living Accommodation Costs (TLAC) survey. Note that the TLAC does not provide any data for the territories.

When deriving student tuition and fees for the four levels of study other than “secondary or less” (i.e. post-secondary, which is further divided into trade/college, university, other post-secondary and other), we made the following assumptions:

  • University – We applied separate undergraduate and graduate tuition values from the TLAC to full-time undergraduate students and students in master’s/PhD programs.[30]

    Part-time students were assumed to take a 50% course load for the purposes of calculation.

    In addition to tuition, we have included “additional fees,” which represent the compulsory fees the universities impose on both domestic and international students, such as facility fees, society fees, health and dental fees (for international students only), student pass fees in some cases, and others. We also made an allowance of $1,200 per academic year for books/tools/materials.

    Tuition and fees are for an academic year (i.e. eight months) in the TLAC data, but for the purposes of this study, we have assumed that 10% of students study 12 months of the year.

  • Trade/College and Other Post-Secondary - For full-time tuition, we applied a factor of 75% to the average university undergraduate tuition in each province. The 75% is an approximation based on web research conducted for select college programs in each province to see how they compare to the full-time tuition for an undergraduate program.

    For part-time students, we assumed a 50% course load.

    We also assumed that international students in “trade,” “college” and “other post-secondary” levels of study pay on average the same percentage (75%) of “additional fees” as university-level international students. We also made the same allowance for books/equipment requirement ($1,200) in a year.

    For international college students in the territories, tuition and fees information was derived from colleges’ websites.

  • Other - since we did not have any detailed information on the nature of their study, we assumed the following: that these students may pay tuition and fees equivalent to the average paid by K-12 and college students. Students in this category were also assumed to incur living expenses equivalent to those in part-time college studies.

For short-term international students, estimates of tuition and fees on a weekly basis were derived from information provided by Languages Canada.

Living expenses

  • Secondary or Less - we assumed that a student in the public school system pays an average homestay cost of $850 per month (in 2015) for a 10-month period. Essentially, we assumed that students return to their home countries for summer vacation. For those in the private, independent school system, we assumed that three quarters of these students pay an average homestay cost of $850 per month, and one quarter of these students board with the school they attend. Values in 2016 were adjusted upward by 2% to account for price inflation.

  • University – for full-time students, we use Statistics Canada’s annual Tuition and Living Accommodation Costs (TLAC) survey data (to calculate the average costs of on-campus room and meal expenses for an eight month period for students in the undergraduate, master’s and PhD programs).[31] Then, values were scaled up to full-year (12 months) values. That is, we assumed that international students in the university category stay in the country for 12 months, even though they may only take courses for two semesters.

    For part-time students, we assumed a monthly homestay cost of $850 in 2015 for 12 months in a year. Values of homestay costs in 2016 were adjusted upward by 2%.

    We also made allowances for transportation costs for students staying in different provinces and territories. We applied data from Statistics Canada’s Survey of Household Spending (SHS), which details household spending on public transportation, by province and territory, in 2013. The values we used refer to the average expenditure per household on public transportation (households that did or did not use public transit). Values in 2013 dollars were adjusted for inflation between 2013 and 2015, and from 2015 to 2016.

  • For students in other levels of study (trade/college and other post-secondary, as well as those in the “other” category), we assumed that they spend the equivalent of what university students have to pay during an academic year (average room, meal and transportation costs).

    The average costs for meals and accommodation at colleges in the territories were derived in the same way as they were in the provinces. Estimates of transportation costs were calculated as the average for provincial transportation costs.

In addition to basic living costs, as presented above, we made an allowance of $2,500 per student per year ($1,500 for K-12 students) for discretionary expenses (such as eating out, recreational activities and entertaining), both in 2015 and 2016.
For each province and territory, for each level of study, the formula to calculate gross expenditures was as follows:

Estimated number of students in that level of study multiplied by the sum of (average tuition and additional fees, books, average room and meal costs, average transportation costs, average discretionary spending) per year = gross expenditures in one year for international students in the level of study

Scholarships and awards

In this study, in order to calculate the net economic benefits that international students brought to the host country, we took into account any financial assistance that international students received from Canadian federal or provincial governments, and from institutions.

We conducted extensive web research on the financial statements of universities and colleges across all provinces in order to find such information, but to little avail. We estimated that the support universities and colleges provide to international students is probably no more than 1% of the student tuition collected.[32]

We were also informed that the federal government annually grants $27 million to support international students.[33] As such, we used a factor equivalent to 1% of international student tuition and fees, plus $27 million to represent the deduction. This reduction factor of 1% was applied to students in the trade/college, undergraduate, master’s and PhD programs only.

Additional tourism benefits from visiting friends and family members

One additional benefit of international education is increased tourism activities, due to family and friends visiting the host country while students remain in the country.

Unfortunately, this area is still a challenge with respect to data availability. We do not have a good handle on the number of family and friends who visit international students during their stay in Canada. For the purposes of this estimation, we applied a similar methodology to the one used in an Australian study to derive the estimated number of international students’ family and friends who participate in tourism activities.

The methodology in the Australian Council for Private Education and Training’s (ACPET’s) 2013 study was based on research conducted by Tourism Research Australia. The study shows that for every 10 formal visiting students (defined as those whose main purpose for visiting Australia is education), an additional five family members or friends visit the country. For every 10 informal visiting students (defined as those whose main purpose for visiting Australia was not education but still studied a course while on their trip), there are an additional 2 visitors.

In our current study, we assumed that for every 10 long-term international students, five family members and/or friends visited Canada during the year, and that for every 10 short-term international students, two family members and/or friends visited Canada during the year.

[29] Note that IRCC collects data on short-term students from some countries (SX-1 Visa holders). However, these numbers are small and not captured in this study.

[30] Detailed data on tuition for full-time undergraduate and graduate students can be found in tables 47 and 48, as well as in tables 63 and 64, in appendices 5 and 6. It should be noted that setting tuition and fees in public post-secondary institutions is generally a provincial/territorial responsibility. As such, the level of tuition shown in these data tables does not necessarily reflect the true cost of educational programs in these provinces and territories.

It should also be noted that, in the release of TLAC data, since 2010-2011, regular and executive MBA (master of business administration) programs have been excluded from the national and provincial weighted averages due to their high costs and their effect on the overall tuition fee average. Dental, medical and veterinary residency programs offered in teaching hospitals and similar locations that may lead to advanced professional certification have also been excluded.

[31] Statistics Canada, TLAC, Table 7. Living Accommodation Costs at Residences, 2015-2016 (final), and Table 7. Living Accommodation Costs at Residences, 2016-2017 (preliminary).

[32] We reviewed the consolidated financial statements of a number of universities and colleges across the provinces. While all financial statements report student tuition and fees received on the revenue side, and amounts paid for scholarships, awards and bursaries on the expense side, very few financial statements actually include information pertaining to international students. From the few financial statements that presented such information, the amount of scholarships/awards/bursaries given to international students accounted for less than or about 1% of the tuition and fees received from international students. See for example, the consolidated financial statements from the Vancouver Island University, and Kwantlen Polytechnic University in British Columbia.

[33] Global Affairs Canada.