The consequences of the UK’s immigration policy on the country’s ability to attract and retain international students have been widely reported. However, a report released today by Exporting Education UK and Parthenon-EY has quantified its economic impact, finding the drop in international student arrivals over the last five years has cost the country an estimated £1.1bn, with an additional £8bn in ‘opportunity cost’ lost.
The £1.1bn loss includes tuition fees, living costs and spending by additional visitors. However, this figure doesn’t represent the whole picture, the report argues, as without the tightening of controls on incoming international students, international student numbers would be expected to not only stagnate but grow.
Had growth rates continued, the study estimates international students would have supported an additional 80,000 jobs
Therefore, taking into account the revenue that could have been generated if historical growth rates had continued, the UK has lost out on an additional £4.6bn since 2011.
Had growth continued in line with previous years, the study estimates international students would have supported an additional 80,000 jobs and an up to 8% rise in financial contributions.
Factoring in the contribution to GDP the UK could have gained if the sector had grown in line with global rates, by 2016/17, “the immigration restrictions imposed since 2011 will have cost the UK economy almost £8bn” in ‘opportunity cost’, the study predicts.
“This cost rises every year, partly because immigration policies continue to restrict areas of global growth such as pathways, vocational qualifications and work-based learning and partly because the UK fails to adjust policies and information to take its share of specific growing global student populations such as India,” it states.
Growth areas of recruitment – such as foundation courses and vocational training – among those “hardest hit by the UK’s recent immigration policies”, the study notes.
Numerically, the ‘opportunity cost’ loss is biggest in the university sector, reaching £2.1bn by 2015/16, followed by independent higher education, at £704m.
The further education and pathway sectors have both lost out on more than £100m, while independent schools have lost opportunity costs of £90m.
Lord Karan Bilimoria, chair of the All-Party Parliamentary Group on International Students, who wrote the foreword for the report, said the UK’s immigration policies mean “we’re just shooting ourselves in the foot”.
“Every day we have these policies we are losing out because of the lost opportunities in these growing economies which are creating an increasing demand for international education, so on the one hand you have got this increasing demand and we are just putting them off,” he told The PIE News. “That is how scary it is.”
If the UK is to reach its target of growing the international education sector to £30bn by 2020, it must develop a “strong, consistent and well defined ‘offer’ to international students”, the report urges.
One of the areas that has particularly harmed the international education sector is the abolition of the post-study work visa in 2012, the report highlights. It therefore recommends introducing a new post-study work programme under the existing Tier 5 (temporary work) route.
Another way of boosting the UK’s attractiveness as an international study destination would be through a multi-year, multi-sponsor visa that includes multiple courses, the report suggests.
“We are losing out because of the lost opportunities in these growing economies which are creating an increasing demand for international education”
“It’s a very interconnected sector,” Joy Elliott-Bowman, policy and public affairs manager at Study UK, told The PIE News.
“Transitions are hugely important – we don’t have a strategy that includes encouraging those transitions, or worse, we’ve got a set of immigration policies that actively discourages transition.
“We’re really going to see numerical drops in the future if we’re cutting off these pipelines.”
The document adds that the UK must hone its messaging in order to showcase its strengths as a world-class study destination with a broad offering that is welcoming to a diverse range of international students.
This messaging must also work to improve students’ perceptions of the UK visa system, the report says, which has been damaged by a growing perception among students that visa decisions are based on subjective criteria.
A government-issued International Education Quality Mark could help to support this messaging, it suggests. This would be awarded based on criteria such as international student completion data and internationalisation of curricula.
Better risk profiling of Tier 4 sponsors that relies more on student outcomes data than “arbitrary categorisation”, a reduction in the frequency of changes to the student visa system and better understanding and data collection on the impact of international students would also contribute to growth, the report concluded.
