International Students at British Universities: A Multi-Billion Pound Economic Impact

International students significantly impact the UK international student impact, with each student intake generating substantial economic activity. According to a study published by the Higher Education Policy Institute (Hepi) and Universities UK International (UUKI), the economic contributions of these students are notable. The analysis reveals that one year's intake of international students at British universities generates £390 per person in the UK annually, rising to over £700 for every resident of London.

The Economic Contributions

The study's findings indicate that the 272,000 international students who commenced university courses in the 2018-19 academic year will generate approximately £26 billion in net economic activity. This figure takes into account the costs of UK international student impact teaching support and the use of public services by these students. The data suggests that just ten international students from outside the EU will generate £1 million in net economic impact during their studies.

This economic impact is derived from several sources. Firstly, the tuition fees paid by international students contribute directly to the income of UK international student impact. Secondly, the spending by these students on accommodation, living expenses, and other personal needs further stimulates the local economies. The multiplier effect of this spending generates additional economic activity, including job creation and further spending within the economy.

Regional Benefits

The economic benefits of international students are not confined to specific areas but are spread across the UK international student impact. Constituencies with universities experience significant local economic stimulation due to the extra spending by these students. For instance, Sheffield Central benefits from nearly 3,000 international students, contributing approximately £290 million to the local economy. Similarly, Nottingham South sees an annual benefit of £261 million from international students.

Vivienne Stern, the director of UK international student impact, emphasized the multifaceted benefits of international students. While their social and cultural contributions are increasingly recognized, this study underscores their financial importance to communities across the UK, aiding economic recovery and supporting the levelling-up agenda.

Cost-Benefit Analysis

The financial benefits generated by international students significantly outweigh the costs to public services, such as healthcare. The study accounts for various expenditures, including teaching grants from central government, net UK international student impact spending, and other social expenditures like police and education. The total costs amount to just £2.9 billion, a small fraction compared to the £26 billion net economic impact.

The analysis by London Economics highlights that these figures exclude opportunity costs and longer-term benefits, such as investment, business, and trade links. Therefore, the actual economic impact of international students is likely even higher.

Growth in International Student Numbers

The £26 billion net total represents a 19% increase in real terms compared to similar analysis using figures from 2015-16. This growth is primarily driven by the increase in international student numbers. In the 2015-16 academic year, 174,000 international UK international student impact students from outside the EU began their studies in the UK. By 2018-19, this number had risen to nearly 208,000.

The study also reveals that approximately £4.7 billion of the net impact originated from EU students, while the remaining £21.3 billion was generated by students from outside the EU. However, these figures are from a time when UK international student impact EU students were still eligible for domestic fees and student loans. Following Brexit, EU-domiciled students are now charged the same higher tuition fees as other international students.

Post-Brexit Impact

Since Brexit, there has been a significant decline in the number of EU students accepting places on undergraduate courses in the UK international student impact In 2020, 22,000 EU students accepted places, but this number dropped to 9,800 in 2021—a decline of over 50%. This decline poses a challenge to the future economic contributions from international students.

Nick Hillman, the director of Hepi, stated that higher education is one of the UK’s leading export earners. He stressed the importance of providing a warm welcome to international students, ensuring that the UK international student impact offer remains competitive, and helping international students secure fulfilling careers post-study. Despite the positive policy environment, Hillman cautioned that the future success of attracting international students cannot be taken for granted, given the recent decline in EU student numbers.

The study by Hepi and UK international student impact the significant economic contributions of international students to the UK. The annual intake of these students generates billions of pounds in economic activity, benefiting both the national and local economies. While the financial benefits far exceed the costs to public services, the recent decline in EU student numbers post-Brexit presents a challenge. Ensuring the UK remains an attractive destination for international students is crucial for sustaining and enhancing these economic benefits. The findings underscore the importance of international students not only for their cultural and social contributions but also for their substantial financial impact on the UK economy.