The Impact of the Cost-of-Living Crisis on Student Decision-Making
The cost-of-living crisis has touched everyone, no more so than university students. UCAS has gained unique insight on how prospective students are really feeling about the cost of living and how it’s influenced their university decisions.
As HE professionals we’re acutely aware of how current students are finding the cost-of-living crisis this winter. Not one day goes by without a story in the media, whether it’s about the availability of accommodation, students resorting to foodbanks or the lack of additional financial support from the Government.
But what about those students who started university this September or those applying now? How has the cost-of-living crisis influenced the decisions they’ve made in choosing a university and what can we do to support them in making the right decision for them? By surveying students throughout their search and application journey and analysing application data, UCAS has gained unique insight on how prospective students are really feeling about the cost of living and how it’s influenced their university decisions.
Strong demand for university but don’t forget your deferrers
Back in June we asked 2022 entry applicants and offer holders whether they were thinking about changing their minds about what they’ll apply to, or which offer they’ll accept compared to what you would have done before the cost-of-living increase.
Applicants did report a greater awareness of cost as a barrier, with 66% of placed students saying they were worried about the cost of living, but it didn’t significantly impact their choice and were still keen to go to university despite their financial concerns. Notably, cost of living did become more important to those making Clearing choices, more so now than the pre-pandemic era.
This sentiment continues to be felt among 2023 entry applicants who, for the most part, continue to hold that strong desire to attend university, and are demonstrating high levels of engagement with the application process, whilst being mindful of cost-of-living factors. Overall, 82% are committed to going to university while others are still considering other options, some of whom admit have been influenced by the cost of living. Among those alternatives apprenticeships are the obvious choice with 47% of applicants considering them alongside the traditional degree route despite supply continuing to outstrip demand. Interestingly 32% are proactively considering deferring to 2024, therefore it is even more essential than usual to keep these students warm over their deferred year, especially while cost of living continues to be a consideration factor.
Impact on the university experience
Even though students are not letting the cost-of-living crisis deter them from their dream of attending university, they do accept their lifestyle expectations are likely to be different to what they had imagined.
2022 cycle applicants were concerned that cost would impact on the experience, and two thirds had already decided to work part time alongside studying. Many had started looking for additional financial support with half thinking that they wouldn’t manage without family support. This continued with 2023 cycle applicants as 68% had already lowered their expectations of student life, with almost three quarters expecting to cut back on extra-curricular activities.
Like the previous cohort, part-time work at university is the most likely approach students are looking to take – are there enough jobs? From my 17 years’ experience working with prospective students and applicants this feels much earlier in the journey than normal – in the past they would usually start considering the need to get a job until the summer or even Welcome Week.
Think about your current and upcoming offer holder communications plan - are you telling applicants about part time job opportunities in your institution or local area? Addressing that hot topic will help students feel informed and supported which, in turn, can only help with conversion.
Looking to stay closer to home
The decision of whether to live in accommodation or live at home has also been influenced by the cost of living increasing in importance as a decision-making factor among applicants. A quarter of students stated they were looking at universities closer to home but despite these increasing concerns, only 16% expressly stated that they chose a university due to the cost of living. This was born out in average drive time between home address and university, which decreased slightly among 2022 applicants compared to 2021, albeit still higher than pre-pandemic as many students are continuing to venture further afield after lockdowns.
Significantly, this decreased average drive time was driven (pardon the pun!) by younger, 18-year-old applicants looking to stay at home particularly within London, Yorkshire and The Humber, the North East, East Midlands and the South West. When students were making their final firm choices, ease and cost of travelling were notable in becoming more important and accommodation less so, as more wanted to commute.
Now is a good time to think about your position in your own local recruitment market as students are considering more local options to save money.
An additional barrier to entry for WP students
Out of all the student groups surveyed, it was clear that the cost of living was having the most significant influence on decision making among those students from the most underrepresented neighbourhoods in HE. Placed applicants in POLAR Quintiles 1 and 2 were more influenced than their peers in quintiles 4 and 5, with 65% more likely to agree that cost of living increase will have an impact on their university life.
Understandably this student group were more likely to consider living at home and applying for university-funded financial support rather than ask their family. We must therefore consider the likelihood that this cost-of-living crisis is not just impacting student’s pockets on a day-to-day basis, but potentially having a greater impact on WP students making less aspirational choices.
Notably, a quarter of all students that declined their place did so because they wanted to live somewhere cheaper due to the increase in cost of living, a trend that was further amplified among students from IMD and POLAR Q1 and Q2 neighbourhoods, meaning even if WP students successfully achieved their first choice university, the cost of living factor could continue to play a role in decision making right up to enrolment and ultimately limiting these students in achieving their full potential.
Bringing cost of living into marketing campaigns
Despite the greater awareness of the cost of living among students, unfortunately, universities may not be doing enough to help applicants feel reassured about the cost of living, as most applicants cannot recall seeing any information on the subject.
Traditionally, other factors like graduate earning potential and league table positions have taken up more space in student attraction and conversion campaigns, and while these still are important, applicants are now really looking for practical tips on how to live day to day at university, and for areas where they can reduce costs.
Best information received included information about living costs and budgeting including breakdowns of expenses, job opportunities within the universities, explaining how they supported students through it. Right now, all institutions have the opportunity to quickly, and with minimal cost, help tackle these perceived barriers through your applicant and conversion communications, information, advice and guidance events and social media channels. Not only will such an approach help with 2023 conversion, but the same messaging has the potential to reach even further among 2024 pre-applicants who will no doubt be considering cost of living as they start researching and shortlisting their university options over the next few months.
What can we do?
With universities and colleges rightly focused on supporting current students through the cost of living crisis, it’s easy to forget that applicants will have been just as concerned about how it’s going to affect them too. But as higher education marketeers, we are in an ideal position to support those future students while achieving our recruitment targets – here are five simple ways you can do that now.
Highlight where universities are making efforts to combat the cost of living across your networks and among key influencers.
Look for opportunities to help students identify sources of potential part time work.
Proactively promote scholarships/bursaries, particularly to WP applicants.
Include practical tips in your recruitment and conversion campaigns in budgeting and managing your money and start communicating it earlier.
Ensure this messaging is used and reiterated across all stages of enquirer and applicant journey.
We have a range of UCAS support for students including our cost of living support hub. By working as individual institutions and collectively as a sector, we can hopefully ensure the relative short-term cost of living crisis doesn’t influence applicants to do anything other than make the right long-term decision for them.
About the author
Vicky Downie has worked in higher education since 2005, with experience in student recruitment, marketing, schools liaison and widening participation roles across seven different institutions including Russell Group, private and subject-specialist universities. During this time, she successfully created and implemented successful data-led student recruitment strategies and so is now excited to be able to support providers and colleagues across the sector to develop their own data insight-informed marketing, recruitment, and WP strategies in her current role as Principal Insight Consultant at UCAS.
