The real contribution of international students

February 28, 2018.

The real contribution of international students

In the light of new research, Stephen Scott, Head of Education at Rider Levett Bucknall, discusses the real contribution of international students.

New research, published by the Higher Education Policy Institute and Kaplan International Pathways, makes interesting reading. The headline is that international students bring economic benefits to the UK worth ten times the costs of hosting them. The report, which analysed the cost/ benefit by parliamentary constituency, also shows that international students bring that economic benefit across the UK – not just in large cities. This will be no surprise to the Higher Education community.

However, this is the first report to do a rigorous cost/ benefit analysis and will put the Home Office under pressure once again to consider removing international students from net immigration figures. A decision is expected in September 2018 from the Migration Advisory Committee and, with luck, will be brought forward.

We’ve also just had the latest figures from HESA which show that the number of international students choosing to study in the UK in 16/17 is pretty much flat year on year. The UK has historically been very successful at attracting international students – with very good reason – but other countries are now gaining ground in an increasingly globalised market.

International students provide a key resource in balancing the books for UK Universities and help to subsidise the teaching of some high cost subjects and research activities. Non – EU international students are a particularly valuable commodity as fees for this group are unregulated. They account for only 13% of student numbers but provide 23% of teaching income.

The prospect of increasingly tight immigration controls is therefore cause for concern particularly against a background of increasing uncertainty in the UK market. The demographic dip in the number of 18-20 year olds currently working its way through the Higher Education system now appears to be biting with student numbers starting to plateau. The ongoing ability of Universities to off-set this through increased levels of participation is uncertain with UCAS figures reportedly down again this year. The demographic projections suggest numbers will not return to current levels until 2024.

“International students are increasingly important as they provide a potential solution to bridge the gap presented by demographics and uncertain tuition fees here in the UK.” 

The government’s future approach to tuition fees is also creating uncertainty in the UK market. The current freeze appears to be a short term political fix and the approach of the new Universities Minister, Sam Gyimah, on this issue will be of significant interest to the sector. More far reaching impacts could result from Labour’s proposals to remove tuition fees altogether. What seems clear is that the current tuition fee regime will not continue as is.

The income from international students is therefore becoming even more critical.

One solution to these challenges that RLB has been involved with is the University of Reading’s new campus in Malaysia. This provides the University with access to the international market without having to overcome some of the immigration challenges presented by delivering courses in the UK.

The building has been designed to differentiate the University from other competitors and the Director of Estates at Reading has said he is “proud to say that staff and students are attracted because of the fabulous building”.

Other Universities that have adopted similar approaches are The University of Nottingham with campuses in China and Malaysia and Newcastle University with their NUMed medical campus in Malaysia.

However, this approach requires significant investment and it is too early to tell if the numbers of students attracted to these satellite campuses is sufficient to justify the costs.

So, international students are increasingly important as they provide a potential solution to bridge the gap presented by demographics and uncertain tuition fees here in the UK. The ability to access this market without barriers and perhaps without the need for significant investment abroad is the ideal scenario.

And this is where the HEPI findings lending weight to the argument to omit students from immigration numbers could be useful. Brexit and our current government policy on immigration are significant factors in creating the unhelpful perception that the UK is ‘unwelcoming’. A change in government policy would send a strong signal to counter that and assist the UK to compete in an increasingly globalised market for students and cement the UK’s reputation as a provider of world-class university education.

This article originally appeared in University Business.

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