factors influencing households’ choice for higher ... · factors influencing households’ choice...

Factors Influencing Households’ Choice for Higher Education

Institution in Malaysia

POO BEE TIN

RAHMAH ISMAIL

NOORASIAH SULAIMAN

School of Economics, Faculty of Economics and Management

University Kebangsaan Malaysia

43600 Bangi, Selangor,

MALAYSIA

NORASMAH OTHMAN

Faculty of Education

University Kebangsaan Malaysia

43600 Bangi, Selangor,

MALAYSIA

pbt@ukm.my ; rahis@ukm.my ; rasiahs@ukm.my ; lin@ukm.my

http://www.ukm.my/fep; http://www.ukm.my/fpendidikan

Abstract : Globalization has demanded for more competitive higher education institutions. Like other services

sector , it is important that higher learning institutions understand the perceptions and expectations of head of

households because they are the decision influencers for their children’ education. This paper examines

households’ view on the important criteria’s in selecting higher education institutions. Personal interview with

4000 households from 11 states of Peninsular Malaysia were carried out. Data were analyzed using Factor

Analysis. Based on comparison of means, rankings of variables influencing higher education institutions choice

decision by important are as follows: financial aid, safety of the campus, academic reputation, university image and

accommodation. Further, through factor analysis, three dimensions were revealed in explaining the decision

criteria’s of Malaysian households, i.e., (1) personal factors, (2) socialization and (3) campus, program and cost.

Keywords : Malaysia, higher education institutions, households, factor analysis,

globalization,

1 Introduction

Higher education is essential for any country to

achieve sustainable growth and global development.

It is also important for the enhancement of society

participation in social mobility, public life,

achievement of harmony, justice and comprehensive

peace at both internal and international levels.

Globalization has required institutions of higher

education to undergo revolutionary changes to ensure

human capital are “produced” not for a product-based

economy, but for a knowledge-based economy. The

rapid expansion of Malaysian higher education has

involved extensive growth that has relied mainly on

the liberalization of the education sector According

to [1] the increase in the demand for post-compulsory

education recorded in the second half of the twentieth

century has been phenomenal. The number of

students pursuing higher education rose substantially

in both developed and developing countries.

Higher education in Malaysia has experienced an

increasing competition among universities and higher

education institutions to attract students both locally

and internationally [2]. Competitive pressure has

forced the higher educational institutions to look for

more competitive marketing strategies in order to

compete for students in their respective markets. The

higher education in Malaysia has gone through

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substantial changes in order to provide quality

education to the nation. Furthermore, the increased

of public demand for tertiary education in both local

and private institutions, and the government’s

aspiration to position Malaysia as a regional centre of

academic excellence have led to the growth of

private higher educational institutions.

One vital exercise which we are usually involved

in our life is the decision making. [3] argued that

education decision making in terms of selection of

universities is one of such exercises that confronts

the average candidate, this is dictated by one

consideration or another. These consideration can be

quite complex, particularly, where there is a large

number of universities to choose from. With the

nation's focus on the higher education sector, there

are 89 public higher education institutions and 460

private educations institutions. The issue of higher

education institutions choice criteria has been widely

researched in Malaysia [4], [5],[6],[7] etc. Most of

the responses from the previous studies were

gathered from prospective students, parents of

prospective students and first year university

students. However, there are limited researches on

factors influencing household’s choice for higher

education institutions. Therefore, this study

contributes to the literature by providing a general

view of factors influencing household’s preferences

in selecting higher education institutions for their

children. The outcome of this research could be

beneficial to both parent and institutions to obtain

planning and decision making in the future.

2 Literature Review It appears that the issue of higher education

institutions choice criteria has been widely

researched. The basic idea is that consumers

(students and parent) will choose a higher education

institution that matches their selection criteria

academically, financially and socially. A study

conducted in Malaysia by [8] found that student’s

preference of a university was mainly determined by

five factors: value and reputation of education,

programme structure, facilities and resources, choice

influencers and customer orientation. [9] developed a

model for foreign student demand for Malaysian

higher education and noticed that course attributes

country characteristic, cost and administrative ease

are significant factors in determining the decisions to

pursue post-secondary education in Malaysia. [10]

examined the selection criteria by international

students of their higher education at private higher

learning institutions in Malaysia. They highlighted

that the most important factors such as qualification

of the teaching staff, English usage, English language

specialized field and top-notch staff were considered

importantly by international students selection

criteria.

Several other studies have identified and suggested

several factors or determinants. [11] and [12]

discussed that empirical results has shown that

location of higher education was an important factor

on higher education institution choice decision.

Availability of the required academic programmes

such as range of programs study, flexibility of degree

program, major change flexibility, range of degree

options and academic recognition (external

influence) are the most important determinants for

students to choose higher education institutions

[13],[14]. Institutional image and reputation has a

tremendous effect on education institutions choice.

Most of the studies found that student value on the

reputation of the institutions was one of the

significant predictor that influences higher education

institution choice decision [15],[16]. Besides, [12]

observed that an educational facility is important in a

student’s selection of a college or university. Cost

of education is increasing as years go by, majority of

the empirical results concluded that cost-related

issues are one of the most important elements that

influences higher education institution choice [17],

[18]. Consequently, availability of financial aid

becomes one of the important factors attributes

expected from a particular higher education

institution of choice [19], [20], [14]. The final output

for the students is the employment opportunities.

Customers (students and parent) of the higher

education institutions are often interested in

outcomes and make college choices based on existing

job opportunities [21].

3 Methodology and Research Design The study focuses on the chosen criteria of head of

households for higher education institution. A total of

4000 questionnaires were distributed in Peninsular

Malaysia for several states. The households were

chosen based on stratified random sampling.

Households are defined as head of households (males

or females) who were working when the survey was

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conduct. Data was collected and analyzed during

the period of November 2010 to May 2011.

Respondents were required to answer the questions

by using 7-point Likert scale. The questionnaire is

divided into two parts. The first section of the

questionnaire asked respondents about their

background. In the second part, respondents were

asked to indicate their levels of importance or less

importance with 19 items when selection higher

education institutions. A total of 3885 respondents’

data were successfully gathered with the response

rate of 97 percent.

Table 1 indicates the respondent’s profiles. In

terms of demography profile, expectedly, the

majority of the head of the households are males

(67.0 percent). Majority of the respondents are aged

between 46 and 55 years old. The Malays make up

the largest percentage of the sample (69.5 percent),

follow by the Chinese (27.1 per cent), the Indian (2.2

percent) and other races (0.6 percent). Very small

percentage of the households is aged above 56. A

larger proportion of the head of the households

attended secondary level of education (48.5 percent),

than those attended first degree education (19.1

percent), diploma (18.7 percent) or primary level of

education (12.6 percent). About one-third of the

respondents, (36.9 percent) receive monthly income

of RM1001-RM2500, 28.3 percents receive monthly

income of RM2501-RM4000. The head of

households who receive monthly income of

RM8001-RM10000 and more than RM 10001 are

very few with the percentage of about 2.5 percent

and 2.3 percent respectively.

Table 1: Head of Household’s Profiles

Variable Frequency

(N= 3885)

Percentage

(%)

Sex

Male

Female

2612

1273

67.0

32.8

Race

Malay

Chinese

Indian

Others

2700

1074

86

25

69.5

27.06

2.2

0.6

Age

25

26-35

36-45

46-55

>56

107

865

1002

1297

612

2.8

22.3

25.8

33.4

15.8

Education Level

Primary

Secondary

Diploma/STPM

Degree

Others

489

1886

728

742

40

12.6

48.5

18.7

19.1

1.0

Monthly

Income/Wages

<1000

1001-2500

2501-4000

4001-6000

6001-8000

8001-10000

>10001

535

1435

1099

486

143

99

88

13.8

36.9

28.3

12.5

3.7

2.5

2.3

4 Results and Discussion Comparing of means was carried out to establish the

order of importance of criteria when household select

higher education institutions in Malaysia. Table 2

lists ranking of the 19 variables that influence head of

household’s decision making. The summary of the

means shows that the head of households placed a

great deal of importance on all the 19 items.

Nineteen selection items are ranked from the most

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important to least important. Ten items have the

mean score above 6 and nine items have the mean

score above 5. When making decision, head of

households appear to be very concern about the

financial aid, safety of the campus, academic

reputation, university image and accommodation

with mean values of 6.30, 6.23, 6.18, 6.16 and 6.13,

respectively.

Table 2: Factors Influencing Choice

of Institution

Ranking Institution’s

characteristics

Mean

value

1. Financial aid 6.30

2. Campus safety 6.23

3. Academic reputation 6.18

4. University imej 6.16

5. Accommodation 6.13

6. Academic Facilities

(library, lab, etc)

6.11

7. Industrial relation 6.07

8. Flexible learning

environment

6.05

9. Quality of the

faculty/lecturers

6.05

10. Medium of

instruction/ language

usage

6.00

11. Tuition fees 5.99

12. Job opportunities 5.91

13. Admission procedure 5.90

14. Location of the

university

5.86

15. International relation 5.85

16. Campus

attractiveness

5.72

17. Multi choice of

courses

5.65

18. Multi- culture 5.64

19. Sport programmes 5.59

After determining the mean analysis, factor

analysis was used to analyse the interrelationships

among the items (higher education institutions

selection criteria). Factor analysis is a data

reduction technique that can help determine a smaller

number of underlying dimensions of a large set of

inter-correlated variables. Factor analysis was used

to assess the nomological validity of the choice

criteria, while discriminant validity of the choice

criteria was examined through the rotated factors

scores across all of the identified factors [18]. The

Kaiser-Meyer-Olkin (KMO) criterion and Bartlett’s

test were used to tests whether factor analysis is

appropriate for these data. KMO measures sampling

adequacy and Bartlett’s test of sphericity. Table 3

illustrates that for these data, KMO score is 0.953.

This KMO value shows that the sample was adequate

and therefore acceptable, and the distribution of

value is adequate for conducting factor analysis. The

Bartlett’s Test of Sphericity value was highly

significant (Chi square = 36893.16, p < 0.05), and

therefore factor analysis is appropriate.

Table 3: KMO dan Barlett’s Test

Kaiser-Meyer-Olkin

Measure of Sampling

Adequacy

.953

Bartlett's Test of

Sphericity

Approx.

Chi-

Square

36893.163

Df 171

Sig. .000

Principal component extraction was used with

varimax rotation method for the factor analysis.

Through this analysis, three factors major

components were extracted from the 19 items. The

non-standardized Cronbach alpha was used to

identify the reliability of identified factor which is

reported to be the preferred method and widely used.

Table 4 shows that alpha coefficients or value for the

three factors are highly reliable and acceptable, with

alpha scores exceeding 0.5, the threshold

recommended by [22] for exploratory research.

In this study, the naming of a factor loading

matrix was straightforward. The three factors are (1)

personal factors, (2) socialization and (3) campus,

program and cost. The first dimension, personal

factors comprised of financial aids, academic

reputation, campus safety, accommodation, quality of

the faculty/lecturers, academic facilities, medium of

instruction and admission procedure explains 44.74

percent of the variance. The second component,

socialization explains 4.11 percent of the variance

and the items are international relation, multi culture,

job opportunities, flexible learning environment,

university image and industrial relation. The last

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component is campus, program and cost, which

include sport programmes, campus attractiveness,

multi choice of courses and tuition fees which

explain 3.53 percent of the variance. All the three

factors explain 52.43 percent of the total variance.

Thus, a model with three factors should be adequate

and the analysis can be considered satisfactory since

they do not exceed 60 percent of the explained

variance recommended in social sciences [23].

5 Conclusions

This study aims to highlight several important factors

to household’s choice when selecting a particular

higher learning institution in Malaysia. Given the

nature of the competitive higher education industry,

it is necessary that the education services are

provided with due care, skill, and diligence

addressing the need of customers. Based on

comparison of means, five variables influencing

higher education institution choice decision in order

of importance are as follow: financial aid, safety of

the campus, academic reputation, university image

and accommodation. Through factor analysis, three

dimensions were revealed in explaining the decision

criteria of Malaysian households, i.e., (1) personal

factors, (2) socialization and (3) campus, program

and cost.

Higher education administrators, marketers and

policy makers must be aware of the requested

heads of households’ selection criteria because they

are the decision influencers in the family. Therefore,

higher education authorities should seek for

improvement of their facilities, service quality and

physical aspects. Educational administrators also

should take note that the attributes identified in this

research are considered important by households and

failure to respond to these issues will result in losing

suitable competitive advantage from higher education

industry.

Table 4 : Factor Analysis of Higher Institution

Choice Decision Factors and Variables

Items Factor

loading

Varian

(%)

Cumulative

Varian (%)

Eigen

value

Factor 1

Personal Factors

(α=0.887)

44.740 44.740 8.971

1.Financial aids .610

2. Academic

reputation

.653

3. Campus safety .608

4.Accommodation .621

5. Quality of the

faculty/lecturers

.595

6. Academic

Facilities (library,

lab, etc)

.600

7. Medium of

instruction /

language usage

.435

8. Admission

procedure

.502

Factor 2

Socialization (α=0.871)

4.108 48.847 1.222

9. International

relation

.740

10. Multi- culture .628

11. Job

opportunities

.651

12. Flexible

learning

environment

.616

13.University

image

.537

14. Industrial

relation

.440

Factor 3

Campus ,

Programme and

Cost

(α=0.747)

3.583 52.430 1.148

15. Sport

programmes

.708

16. Campus

attractiveness

.639

17. Location of the

university

.564

18. Multi choice

of courses

.465

19. Tuition fees .439

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