China’s sluggish economy, weak domestic demand, and real estate crisis have directly impacted the survival of many small businesses and the income of the middle class. This has also brought economic pressure to Chinese students studying abroad. Some are no longer able to rely on their parents to pay for tuition and living expenses.
Whether in the UK or in the US, the financial difficulties faced by Chinese students studying overseas are receiving increasing attention. “Cutting off study abroad funding” has become a hot topic on Chinese social media.
In 2019, when Xiao Zhang was studying in the US, she never imagined she would one day have to rely on part-time work to pay for her university tuition.
According to a report from US financial news CNBC, the 24-year-old Chinese student is currently studying design at a university in Alabama, and her expenses had always been covered by her parents in China. However, in October last year, her parents informed her that they were facing cash flow problems and could no longer provide financial support for her studies in the US. At that time, Xiao Zhang only had enough money to cover three months of rent. Additionally, she still needed to pay for another semester of tuition.
“I didn’t have time to feel sad because I needed to quickly earn money to pay for tuition and rent,” Xiao Zhang said. She added that her father invested in the pharmaceutical industry during the COVID-19 pandemic but suffered huge losses afterward. After watching his wealth and investments shrink, he had to tell her that he could no longer support her education in the US and was willing to buy her a ticket to return home.
To cope with the sudden economic hardship, Xiao Zhang started looking for part-time jobs like babysitting or campus work, but it wasn’t easy. It wasn’t until a month later that she found a temporary job in another state.
“From November to January, I had to start working from 7 a.m. every day,” she said. “I was exhausted during that time and had no time to study. But at least I earned enough money to pay for the next semester’s fees.”
Xiao Zhang’s example is not unique, as with China’s ongoing economic downturn, her experience has become increasingly common. Bloomberg has previously interviewed several Chinese students who shared stories of their parents’ finances being hit at home, making it difficult for them to afford expensive overseas tuition fees. Emily Xiong is one of them.
Bloomberg reported that she was studying a pre-degree course in Birmingham, UK, and hoping to attend university overseas. When she returned home for winter break, her father told her that his business was in trouble, forcing him to sell assets to make ends meet, and also needing expensive medical expenses. While Xiong returned to Birmingham, her mother told her to consider studying in Malaysia with lower tuition fees. She said that while studying in the UK would be better, she had to make a choice within her parents’ affordability.
New York-based education consulting company Cheersyou told Bloomberg that before the pandemic, Chinese students studying abroad was rarely an issue, but among the Chinese students they recently consulted with, 10% have changed their study plans due to insufficient funds.
Economists believe that the plight of these students highlights the vulnerability of China’s middle class. When the economic situation worsens, they have almost no one to turn to. Decades of rapid growth have given many families a false sense of economic security, but they lack diversified assets of the truly affluent class.
Since last year, the hashtag “cutting off study abroad funding” on the Chinese social media platform “Little Red Book” has received 4.62 million views. As more and more Chinese students find themselves in economic difficulty due to shrinking family wealth, many are seeking help online and looking for advice on how to cope.
Some of the topics on “Little Red Book” include: “How to save yourself when study abroad funding is cut off in the UK”; “Studying in the US suddenly cut off, can’t get a penny from home”; “Cutting off study abroad, middle-class families suddenly fall.”
So far, the Chinese Communist Party has yet to address the ongoing real estate crisis that has lasted for several years. As 70% of family assets are related to real estate, the collapse of the industry means a sudden reversal for many Chinese families, further impacting their children studying abroad.