By Craig Lofts , Ben Apted   /

Are ‘Regional’ universities up for the challenge and the opportunity for growth?

Universities outside the capital cities may be set to play a much more prominent role in Australia’s higher education future.

The Australian Universities Accord, amongst its many aspirations, has set a target to raise the proportion of 25-34 year olds with a bachelor or higher degree from the current level of 45%  to 55% in 2050.

At SPP we have been thinking about what this means for different parts of the country and different types of universities. Our analysis shows that there is enormous work to be done outside the capital cities if Australia is to achieve this target. Key insights include:

  • Bachelor degree attainment levels outside the capital cities need to increase from 29% to 50% just to achieve parity with the capital cities today
  • Non-capital city universities will need to lift undergraduate completions by around 75% by 2050
  • A nuanced view of ‘regional’ universities is required – not all universities outside the capital cities are, or will be by 2050, ‘regional’ – location and communities served matters

The target should be seen as a great opportunity for growth universities beyond the capital cities, although many challenges will need to be addressed and will require:

  • A collaborative effort by government, schools, universities, industry and communities
  • Innovative new models for engaging with students and delivering quality education
  • New ways of thinking about the roles for physical and ‘virtual’ campuses

The ambition: A near doubling of ‘regional’ annual domestic bachelors

The Accord sets a national target to increase bachelor degree attainment amongst 25-34 year olds from 45% now, to 55% by 2050

This substantial increase is needed for Australia to have the skills required for the jobs of the future. The importance of this goal is even more critical given Australia’s aging demographic profile which will place greater reliance on a proportionately smaller, although numerically larger, working age population. The Accord places great emphasis on equity of access to education. This is not only morally just and fair, but an imperative given the need to educate, skill and employ all working age people possible to meet the skills shortages faced.

Attainment levels in ‘regional’ areas must first increase from 29% to 50% just to achieve parity with the capital cities

Exhibit 1: Bachelor-degree attainment levels in 25-34 year olds (2023 actuals vs. 2050 target)

Definitional note: The analysis in this article is conducted on Capital v Non-Capital City areas. Therefore, the definition of ‘regional’ university is broadened to all universities in and serving areas outside the capital cities.  For this reason, we also consider CDU, UTas and Deakin (Geelong/Waurn Ponds) and Griffith (Gold Coast).

Bachelor degree attainment outside the capital cities, at 29%, is far below the national average let alone the 2050 target.  It will be practically  impossible for the national target to be achieved if this gap is not substantially closed.

Exhibit 2: Pathway from current domestic bachelor graduates outside capital cities from 2023 to the 2050 target (25-34 year olds)

Non-capital city universities will need to grow undergrad completions by ~75%

‘Regional’ universities should assume responsibility for achieving an increase in domestic bachelor graduates of ~22,000 annually

SPP has estimated that the 55% target in 2050 applied to the school leaver aged cohort living beyond the capital cities will require 58,000 bachelor graduates annually (Exhibit 2). Further, SPP has charted the pathway from current graduations outside the capital cities to the graduations needed by 2050 to meet the 55% attainment target set in the Accord, based on ABS medium series population projects by age cohort.

Meeting the unique, often complex, needs of students from outside the capital cities is one which regional universities are best placed to achieve. Many students from regional areas move to the capital cities on completion of school and obtain their degrees from capital city universities. This will continue to be the case and so all universities have a role to play in the task of increasing regional area attainment. In SPP’s view, regional universities are best placed to take the lead responsibility in lifting attainment levels to parity with the current levels in capital cities, which equates to an 22,000 estimated additional annual bachelor degree completions amongst school leavers by 2050.

Meeting the attainment target will require universities outside the capital cities to increase undergraduate completions by a compound annual growth rate of 2.1%, over and above population growth. The additional 22,000 annually would represent an increase of around 75% (~60% on the 32,000 current total undergraduate completions or nearly 90% if based on an estimated 25,000 school leaver age cohort bachelor completions – the cohort to which the 2050 target really applies).

What does this mean for each university beyond the capital cities?

Completion numbers for each university and major campuses outside the mainland state capital cities are shown in Exhibit 3, to bring the reality of this target to life. It will be appropriate for some universities to target a higher or lower numerical target based on the circumstances of each university and the demographic, industrial / economic and other factors of the communities which they serve.

Exhibit 3: Illustrative non-capital city university annual domestic undergraduate completions (2024 and 2050 requirement)

A nuanced view of ‘regional universities’ is required

Not all universities outside the capital cities are, or will be, ‘regional’

The label of ‘regional’ university dismisses the varied demographic and economic landscape outside the capital cities. Furthermore, this landscape is dynamic and changing. Climate change will alter where and how we live. Economic and technological development will change where, when and how we work. The ABS is projecting capital city populations in New South Wales, Queensland and Victoria to be constrained and aging, with growth in families occurring outside the capital city boundaries, whilst in the other states population growth will be focused

University location and communities served matters

Where a university campus is located has many profound implications, including its infrastructure, ability to attract a workforce, relationships with industry, opportunities for research and even access to government funding pools.

The characteristics of the communities a university serves, has implications for its size, offering and type of student experience to provide. In reality, each university campus services a number of student markets (local, intra-state, interstate, international, undergraduate, postgraduate, school leavers, mature age).

Exhibit 4 below illustrates that ‘regional’ universities and campuses fall across a continuum of categories. SPP acknowledges that the situation for each university presented, when one considers the breadth of its student body and its campus (physical and online) network, will be more complex, but the point is that there is no one-size-fits-all approach to delivering on the growth required to meet the target set by the Accord. Universities also need to consider how their position in Exhibit 4 might change by 2050 as local populations and industry grow and/or decline.

Exhibit 4: Illustrative view of Universities beyond the capital cities (2024) – more than simply ‘regional’

A collaborative effort by all stakeholders will be required

Universities will need to work with others to address the many  barriers to education outside the capital cities

The challenges for people in regional, rural and remote areas to access and successfully complete higher education are well documented and understood by universities. Clearly, there will need to be partnerships between governments, universities, schools, communities and industry to develop sufficient system level solutions and support mechanisms for students.

Government will need to set the design principles

A ‘regional’ university perspective on this challenge would be ‘how to make regional universities stronger?’ This may be an outcome but it is not the way Australia as a whole should think about it. Government will consider this challenge from a national and a student centred perspective which would frame the challenge in terms of ‘how do we better deliver education to people in regional areas?’

SPP expects that government thinking will, for example, be including the following:

  • Financial incentives for students to choose regional over capital city universities
  • Capping of capital city university places to support a diversification drive
  • Greater focus and intervention to identify and promote education models that support and deliver education success amongst disadvantaged students (e.g. low SES)
  • Watching closely the ‘managed campus’ model offering that allows universities to partner with student recruitment and private training providers to grow into other geographic markets as the need to provide high quality education is critical
  • Focus on competition considerations – are better education outcomes achieved through promotion of competition or collaboration between universities?

Universities should be thinking about how to inform this policy making with an open and creative mindset.

The target presents challenges for universities

Universities will need to develop effective solutions, which will include:

  • New marketing and student recruitment approaches
  • New models for student experience and support
  • Compelling program offerings
  • Physical and virtual campus development
  • Expanding teaching capacity (through attraction of teachers, leveraging of AI and other technologies and partnerships)

The target presents opportunities for universities

If the challenges can be addressed, then universities will be able to benefit from:

  • Growth in teaching revenue to reinvest in teaching and/or research
  • Scale to support expanded offerings
  • More and deeper partnerships with industry
  • Greater contributions to local and regional communities and economies

Innovative models and clear roles for campuses can set a successful pathway

Regional universities do much good and effective work now to support education attainment

Regional universities understand the challenges facing young people outside the capital cities. Much great work is already being done with good successes to educate young people outside the capital cities. However, much more needs to be done.

New approaches are needed to deliver the outcomes Australia needs

Universities will need to identify, test and develop new strategies and initiatives which could include:

  • Innovative models to support people into and succeed at university (some inspiration could be found in Victoria University’s first year model)
  • New ways of partnering with capital city or other regional universities for mutual benefit, in areas such as pathways and complementary offerings (e.g. co-branded degrees)
  • Working with industry in both regional locations and capital cities to develop employment pathways for employers to access a skilled workforce from outside the capital cities (noting that options will increasingly open up for remote and hybrid working models)
  • Redefinition of the role for campuses in terms of community engagement, industry engagement, research intensity / focus, and education offering, considering both the physical and virtual realms.

There is no time to waste

The Accord has set not only the target but also some interim goal posts to guide the sector on its path to 2050. This includes “attainment and participation targets should be set for 2035 and the following years with the aim of reaching equal participation by 2050….24.0% from 19.8% for regional, rural, and remote students”. These targets should be read with a sense of urgency.

The pathway to 2050 needs to start now to build the required news ideas, initiatives and partnership and start generating, and showcasing, momentum towards a bigger and greatly more impactful higher education system beyond the capital cities.

Key Contacts

Ben Apted  /  Senior Partner

Ben Apted is the Senior Partner of SPP. Ben leads SPP's Education, Research and Digital Practices.  Ben is a thought leader and contributor nationally and internationally on higher education strategy, engagement and operations. He has led transformation of government service...

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Craig Lofts  /  Principal

Craig Lofts is a Principal at SPP and brings broad experience and perspectives having consulted and worked in the education, government, NFP, property, defence and manufacturing sectors. Craig has a proven track record of delivering pragmatic outcomes for clients who...

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By Craig Lofts , Ben Apted   /