Around one third of international students who begin a degree in Germany are expected to remain in the country as qualified workers until retirement, according to new research highlighting their long-term economic contribution.
The report, produced by the German Economic Institute (IW) for the German Academic Exchange Service (DAAD), estimates that the 2023 cohort will create a €23.1bn surplus for Germany’s public finances over its working life.
For the nearly 82,000 degree-seeking international students who entered German higher education that year, researchers projected a total gross value-added contribution of around €127bn across their careers.
Their combined taxes and social security contributions are expected to outweigh the public support they receive, including the cost of largely tuition-free university places, within two years of graduation.
“The latest IW report once again demonstrates the crucial role that international students and doctoral candidates play in the German economy,” said DAAD president Joybrato Mukherjee.
“At the same time, it is clear that anyone who wants to attract international talent to Germany must create attractive living and study conditions and contribute to a welcoming culture that ensures a smooth transition into university studies, society, and the job market.”
The findings provide a clearer picture of international graduate retention by drawing on Germany’s microcensus, the country’s largest annual household survey, which covers employment, income, education and living conditions.
The analysis indicates that 59% of degree-seeking international students remain in Germany during the nine years following their arrival, with around three-quarters of that group completing a university qualification.
This means approximately 45% of the initial cohort becomes available to Germany’s labour market as academically qualified professionals after completing their studies, although some leave later in their careers.
After accounting for subsequent departures, the IW estimated that 34% of the original degree-seeking cohort remains in Germany as qualified workers until retirement.
The report builds on a 2025 IW study that modelled three possible retention scenarios because more precise evidence was not then available.
That research projected a €15.5bn public-finance surplus under its medium scenario, which assumed 20% of international starters would remain until retirement, rising to €26bn if the proportion reached 37.5%.
The latest €23.1bn calculation therefore places the economic return towards the upper end of the scenarios considered last year.
The report said Germany could increase that contribution further by improving academic success, reducing dropout rates and helping international graduates enter relevant employment more quickly.
It is clear that anyone who wants to attract international talent to Germany must create attractive living and study conditions and contribute to a welcoming culture that ensures a smooth transition into university studies, society, and the job market
Joybrato Mukherjee, DAAD
That challenge has become increasingly important as Germany’s international student population grows alongside mounting shortages across its skilled workforce.
Germany hosted 516,820 students with foreign citizenship in 2025/26, representing 18% of its university population, according to the latest official figures.
Indian enrolments alone reached a record 69,816 during the year after rising by 17.5%, making Indians Germany’s largest international student community.
The country’s relatively affordable public universities, expanding English-taught provision and established post-study employment routes have strengthened its appeal as other major destinations tighten immigration rules.
Separate research published by Stifterverband and DEGIS earlier this year found that international graduates were three times more likely to find work than qualified migrants arriving directly for employment.
Researchers attributed that advantage to the years students spend building local networks, improving their German and gaining practical experience through internships, student jobs and company-linked dissertations.
More than half of Germany’s international students are enrolled in STEM subjects, providing a potentially important source of talent as the country confronts a shortage of around 148,500 STEM professionals.
A further 1.85 million people are expected to leave Germany’s STEM workforce over the coming decade, adding urgency to efforts to connect international graduates with employers.
Ákos Király of SRH Higher Education argued on LinkedIn that universities must treat recruitment, education, employability, employment and retention as parts of a single international student journey.
He called for career guidance from the beginning of a student’s degree, stronger university-employer relationships, greater practical experience and better support during the transition into work.
Király also suggested that graduate retention should become a core measure of internationalisation strategies as Germany competes to secure highly skilled workers.
“The question is not whether Germany can attract global talent,” he said. “The question is whether Germany is good enough at keeping it.”
