International students contribute £41.9 billion to the UK economy

Anna·18 May 2023·5 min read
International students contribute £41.9 billion to the UK economy

The report, published by Universities UK International (UUKi), the Higher Education Policy Institute (HEPI) and Kaplan International Pathways in collaboration with London Economics, was commissioned to explore the impact of international students to the UK economy.

The data confirms that even when accounting for the impact on public services (roughly £4.4 billion) the economic benefits of hosting international students significantly outweigh the costs, with a total net benefit of £37.4bn to the UK economy.

Jamie Arrowsmith, UUKi director, said: “We should be proud that our universities continue to attract students from all over the world. It is vital that the UK remains an open and welcoming destination for international students, and that their contribution is recognised and valued.”

The study, which focuses on the group of students who started higher education in the 2021/22 academic year, estimates that each of the UK’s 650 parliamentary constituencies is £58 million better off because of international students – equivalent to approximately £560 per citizen.

The research comes at a time when the government is considering imposing restrictions on international students coming into the UK.

Prime Minister Rishi Sunak is planning to crack down on the number of foreign students entering the UK in an attempt to tackle record immigration numbers.

It is believed that ministers are considering a range of measures including visa restrictions for international students’ dependants and reductions in post-study work visa rights, both of which would act as a deterrent to potential overseas students.

An official Spokesperson for the Prime Minister was quoted in The Guardian saying, “We’re considering all options to make sure the immigration system is delivering, and that does include looking at the issue of student dependants and low-quality degrees.”

The Spokesperson declined to further define a “low-quality” degree.

The Prime Minister’s plan echoes complaints made by Home Secretary Suella Braverman. In October, Braverman was quoted saying foreign students were “bringing in family members who can piggyback on to their student visa” and “propping up, frankly, substandard courses in inadequate institutions.”

Vivienne Stern, the chief executive of the Universities UK group, suggests that one of the ways in which the government is considering reducing net migration is through revaluating the graduate student work visa, which allow students to work in the UK for two years after they graduate. One option, favoured by Braverman, would shorten the graduate work visa period from two years to as little as six months.

The response has not been positive as university leaders fear billions being lost as a result of student visa restrictions.

An adviser on immigration policy has warned that universities could go bankrupt if the government chooses to limit the number of international students.

Prof Brian Bell told BBC Radio 4’s Today programme: “Most universities for most courses lose money on teaching British students and offset that loss by charging more for international students. If you close down the international route, I’m not sure how the university continues to survive.”

Dr. Gavan Conlon, partner at London Economics, says international students put nearly 10 times more into the economy than they take out.

The new research shows that the economic benefit international students bring to the UK has seen a dramatic rise over the past few years – up 58% since 2015/16. One of the reasons for such a substantial growth can be attributed to the 68% rise in the number of international students from non-EU countries since 2018/19.

Data from the report indicates that every 11 non-EU students generates £1 million worth of net economic impact for the UK economy. As such, even when accounting for dependents and other costs, international students prove to be a huge net contributor to the UK economy.

Regarding the report, director of DataHE Mark Corver explains: “Calculations for UK students, particularly if it took into account their longer duration post-graduation work, would likely generate even larger figures for ‘impact’ on the economy.”

HEPI director Nick Hillman adds: “If there were to be further changes to the rules on international students, then it is vital that these are based on evidence rather than whim. So, this report is designed to strengthen the existing evidence base.”

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