They also made more than EUR13 million surplus.
A new university year started on Monday and the high school graduation exam pass rate of only 44% of the 200,000 students who took it this year shows that everyone is hurting for students; the war is at its fiercest among private universities.
A number of 400,000 students are attending public universities and 140,000 private universities to get their undergraduate degree, according to the National Statistics Institute.
While the Western European countries or the United States have prestigious private universities, where employers go to pick their best employees, in Romania there was a time when employers would not even look at people who graduated from private universities.
The “fake diploma” affair of 2009 involving Spiru Haret University, the largest private higher education institution of the country (which issued graduation diplomas for unaccredited programs) and the recent developments where some members of the Bioterra University faculty were accused of revealing the content of the graduation exam papers are making private education institutions look bad. Employers, however, say the competencies gap between public and private university graduates are no longer as wide as they were ten years ago.
“The quality of the education system both public and private is poor, which is why no distinction is made upon recruitment among the universities the applicants graduated form any longer. There is prejudice against private universities, indeed, but we evaluate the competencies and the experience of the applicants first of all,” says Florin Godea, country manager of the recruitment service provider Adecco. “One can tell during the interview how hard students studied in school, because the faculty and the curriculum are largely the same.”
Godea says the school matters mainly for management jobs where employers prefer graduates of prestigious foreign universities.
Although the diploma affair and the lower number of high school students passing the graduation exam of the last two years halved its revenue, Spiru Haret remains the most profitable education business. The university posted almost EUR55 million revenue and EUR7.7 million surplus last year. Although educational institutions may not pursue profit, the budget surplus may amount to 10% to 20% of the revenue for some of the largest private universities in Romania. Spiru Haret’s 2011 surplus therefore equaled the profit of one of the most profitable 150 companies in this country. Drug producer Zentiva, for instance, posted EUR7.9 million profit, and ranked 134th among local companies by this indicator. Spiru Haret’s surplus was also higher than Romania’s largest grain trader, Cargill Agricultura, whose net income stood at EUR7.4 million in 2011, according to the Finance Ministry website.
The university, however, has lost 40% of its revenue and 80% of its surplus because the number of students went down and it closed the distance education department in the past two years.
Second largest private university is Vasile Goldis Western University of Arad (western Romania), with almost EUR16 million revenue and merely EUR150,000 surplus last year. Back in 2009, it posted EUR4.6 million surplus and EUR19.5 million revenue.
“Most of our graduates have already found a job, many of them are going to Austria and Germany, where they find higher paying jobs, even though they might want to work in Romania,” says Professor Aurel Ardelean, PhD, rector of the Vasile Goldis Western University, which has 15,500 students enrolled at the moment.
The high number of students who passed the high school graduation exam and chose to enroll in a private university can be explained in part by the fact that the admission criteria of such institutions are more permissive (no exam, only a score where the high school graduation exam score is most important and may be the lowest possible required to pass) and lower tuition fees.
“Despite the poorer results of the high school graduation exam, we weren’t seriously affected by the number of first year students, which was maybe several hundred student lower than before in the last two years. Tuition for a year at our school is 1,200 lei (EUR265), much lower than at public universities,” says Professor Aurel Ardelean, PhD, who is also the chairman of Association of Accredited Private Universities of Romania.
First year tuition at the Academy of Economic Studies, one of the most prestigious public universities is RON3,000.
Romania’s higher education network includes 108 public and private universities with 614 faculties. Almost half of them (51) are private institutions and operate 204 faculties with 140,000 students. (EUR1=RON4.5178)
(English version by Loredana Fratila-Cristescu)