As Pool of DSE Takers Shrink, Self-financing Tertiary Institutions Must Also Attract Students From Elsewhere

Written By : Justin Chan

Results for the Hong Kong Diploma of Secondary Education (HKDSE) exam were released in July. Around 43 thousand local high school students use their results to apply for 62 thousand places in undergraduate and sub-degree programmes offered by local tertiary institutions, which is good news for the majority of those hoping to pursue further studies. 


However, the surplus of tertiary education opportunities spells trouble for self-financing institutions, which have been facing difficulties in recruiting students, especially those which mainly offer sub-degree programmes. In the last academic year, many institutions missed their planned student intake target by more than 20%. The situation is expected to worsen in the coming years due to two main factors. 


Firstly, we estimated that the number of local high school graduates would remain low in the next three academic years (from 2022/23 to 2024/25), at around 42 to 45 thousand. Demographic change is a significant reason behind this trend, as the local birth rate had been steadily decreasing in the 1990s and stagnated in the first half of the 2000s.


Secondly, the proportion of high school graduates entering overseas or Mainland tertiary institutions has risen significantly from around 10% in 2019 to 14% in 2021. More students opt for tertiary programmes elsewhere, easing the competition for local bachelor’s programmes, so that fewer high school graduates will resort to sub-degree programmes. 


To foster the sustainable development of self-financing tertiary education in Hong Kong, the Government should look beyond the local student population to attract more students elsewhere, especially from Mainland China. The Government should work with the relevant Mainland authorities to relax restrictions on Mainland students’ admission to Hong Kong’s self-financing tertiary institutions. Under current policy, only six such institutions may admit students from the Mainland, limited to 10% of their total student body. Raising the limit to 20% or above and allowing more institutions to admit them would expand the potential sources of students and introduce more flexibility to the recruitment strategies of tertiary institutions. 


In order to attract more non-local students, tertiary institutions should also consider developing sub-degree programmes which focus on training the skills highly sought after by employers throughout the Greater Bay Area. High-tech manufacturing firms in Shenzhen and Guangzhou may need talent in areas of mechanical design or product development. Tertiary institutions can leverage their international reputation and quality to draw students from Mainland cities. 


More financial assistance should be given to tertiary institutions and students, for institutions to offer programmes that are more attractive to prospective applicants and more in line with the demands of the labour market. 


Recently, the Government has started providing financial support for tertiary institutions to develop programmes that “meet market needs but require high start-up costs”, including those related to physiotherapy and medical science. This policy is commendable and should be expanded. Self-financing institutions may lack the capital to develop programmes requiring laboratories and other costly facilities, so financial support may help them develop specialised and in-demand courses, rather than programmes that train more general skills such as business and management. 


The Government should increase the number of subsidised top-up degree programme places, from 5,000 to 6,000, so that more sub-degree students can pursue further studies at a reduced cost. With more opportunities to enter undergraduate programmes in senior year after completing sub-degree programmes, the latter would become more attractive to high school graduates. In particular, subsidies should be focused on vocational-oriented programmes related to emerging industries in Hong Kong. 


To conclude, as the self-financing tertiary education sector will continue to face a shortage of students, the Government should take prompt action to enable these institutions to diversify their source of students, while ensuring that their programmes maintain high quality and suit the needs of students and the job market. 



Originally published in SCMP on September 13, 2022