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UK misses out on more than £8bn due to student visa changes

The UK economy may have lost out on billions in export earnings from international students due to immigration rule changes made in 2012.

This is one of the main findings from a new analysis from Universities UK, looking at the impact of changes to UK student migration policy in 2012. Under one scenario, it is estimated that the UK may have lost more than £8 billion in the period 2013-17.

Total international (EU and non-EU) student enrolments in the UK dipped slightly in 2012-13 following the immigration rule changes and have since flatlined. Conversely, other countries such as the US, Canada and Australia have continued to grow over this period.

Commenting on the figures, Alistair Jarvis, Chief Executive of Universities UK, said: “Despite the quality and popularity of our universities as destinations for international students, in recent years we’ve seen a declining market share in relation to competitors.

“Since 2011, countries such as Australia, Canada, and the US have seen high growth in international demand for study, while the total number of enrolled international students in the UK has stayed flat.

“The UK could and should be doing much better than this. To keep up with competitors, the UK government needs to promptly develop a reshaped immigration system that recognises the value of international students as temporary visitors and tells the world that they are welcome here. This should include improved post-study work opportunities.

“International students provide a very positive economic boost in terms of spending and jobs in communities across the UK. They enrich our campuses and the experience of UK students, both academically and culturally. Many return home having built strong professional and personal links here that provide long-term, ‘soft power’ benefits for the UK.

The Universities UK analysis considers two scenarios, one where non-EU student growth in the UK continued at the rate observed between 2008 – 2012, prior to immigration rule changes, and the other where UK non-EU student growth mirrored the growth seen in Australia in this period.

In 2016-17, 442,375 international students made up 19% of all students registered at UK universities (6% from the EU and 13% from non-EU countries). The income and economic activity of these students resulted in £25.8 billion in output and 206,600 jobs for the UK economy in 2014-15 alone. International students also enhance the academic experience of domestic students and add to the UK’s soft power abroad, with 57 current world leaders having been educated in the UK.

In terms of international student enrolments, countries such as USA, Australia, France and Germany all continue to grow at a faster rate than the UK, with growth rates in 2014-15 of 9.4%, 10.7%, 1.8% and 8.7% respectively. Over the same period, the UK’s international enrolments grew by just 0.5%. See the latest International Facts & Figures publication.

Universities UK called recently for a new visa to allow international students to gain work experience in the UK for up to two years after graduation. In 2012, the UK government scrapped the post-study work visa which had allowed international (non-EU) students to stay in the UK and work for up to two years after graduation. The new visa would allow a wider range of employers – in all parts of the UK – to benefit from access to talented graduates from around the world, including small and medium employers who do not have Tier 2 sponsorship licences, usually due to the high costs and bureaucracy involved.

In other countries, it is widely accepted that international students are temporary citizens whereas in the UK they are categorised alongside those who have a route to staying in the UK permanently. For example, in the USA international students are classified as non-immigrants alongside tourists, business visitors and those on cultural exchange programmes, in Australia they are classified as temporary migrants alongside tourists and visitors and in Canada they are classified as temporary residents.

new poll published recently from ComRes, based on the views of more than 4,000 British adults, revealed also that in relation to the UK government’s immigration policy, only a quarter (25%) of British adults say that they view international students coming to study at UK universities as immigrants. It revealed also that nearly three quarters (72%) of British adults polled think that international students should be able to stay in the UK post-graduation for one year or more to gain work experience.

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