Despite zero public fees, Germany’s private universities are booming

At first glance, Germany might seem an unlikely place for a boom in private, fee-charging universities.

Famously, the nation’s public universities are all but free to attend, even for foreign students, and are seen as consistently decent in quality.

But despite this, an ever greater number of students, German and foreign, are choosing to pay to go private, lured in by small class sizes, niche professional courses, plus part-time and evening options for those already in work. A flowering of private campuses across the country has been the result.

In the 1990s, private universities barely registered in German higher education. In 1997, just one in 100 students attended a private institution, according to the most recent statistics from Germany’s Federal Statistics Office.

But since then, “there has been quite an explosion of the private university sector”, said Andrea Frank, a researcher who has tracked the rise of private universities at Stifterverband, a German business-funded education organisation.

By 2017, one in 12 students was attending a private institution – close to a quarter of a million in total. There are now 120 private universities across Germany, up from around 50 in the early 2000s.

SRH Hochschule Berlin is one such institution. Founded in 2002 and headquartered among a cluster of other universities in the west of the capital, it now teaches around 1,200 students. The university hopes to move to a new campus, merging with two other private institutions specialising in art and design.

Around six in 10 of SRH’s students come from Germany, but relatively recent additions of engineering and computer science master’s courses taught in English have helped draw in students from India, who make up 16 per cent of the student body. Overall, private universities are growing their foreign intake rapidly – up nearly a fifth in 2018 – but are still slightly less international than their public counterparts, according to Wissenschaft Weltoffen 2019, a report from the German Academic Exchange Service.

When students first arrive at SRH, teaching groups are small enough that academics can take them out together for a drink, Bert Eichhorn, vice-president of international affairs at SRH, told Times Higher Education during a visit to the campus. At public universities, meanwhile, packed lecture halls and uncontactable professors with hundreds of students have become a cliché – fair or not. 

Because private universities are “much smaller”, the “professor-student relationship is better than in public universities”, said Ms Frank. Dropout rates tend to be much lower, she added.

Another reason for private universities’ expansion is that they have been “very smart” at carving out “niche” courses that public universities simply do not offer, she explained.

One such example is Hamburg’s Kühne Logistics University, explained Piret Lees, a spokeswoman for Germany’s Association of Private Universities. The university was started by the eponymous logistics giant because no other institution was offering sufficiently specialised courses.

But claims that private universities have better links with employers are arguably a “myth”, said Ms Frank: survey data show that companies like to recruit from both public and private institutions. “It’s marketing,” she said.

How much does all this cost? There are no recent figures on average private fees in Germany, and Ms Lees stressed that costs vary widely depending on course and location. Like UK universities, SRH Berlin charges more for students outside the EU – €10,800 (£9,559) per year for an engineering master’s – than for EU students, who pay €9,360.

One reason it is possible to charge non-EU students more is that outside Europe private universities are synonymous with good quality, an idea less familiar to Europeans, said Professor Eichhorn.

Students are often able to get special loans – sometimes offered by the universities themselves – that they pay back with a fixed percentage of their post-graduation income above a certain threshold, explained Ms Lees. 

Despite rapid growth, a handful of high-profile bankruptcies and financial problems have hit the private sector in recent years. “People don’t do it for fun,” said Ms Lees. Extensive market research on student demand is normally carried out before new institutions are set up.

The majority of private universities are non-profit, according to Ms Frank’s most recent analysis. With more than 1,000 students, private universities are typically financially viable, she estimated, although if they want to do serious research as well as teaching, they need the backing of a foundation behind them.

Yet for all their success, some observers feel that private universities might be losing their edge, as public universities catch up in offering flexible continuous education to people already in work, said Ms Frank. “Some of the USPs they had in 2010 are not so strong any more,” she said.

david.matthews@timeshighereducation.com