The real value of international students to the UK

A new report looks at the contribution that international students make to the UK economy

The benefits of studying abroad for students are well-documented: international experience is high on the list of qualities desired by graduate employers; the opportunity to meet a diverse group of people and become immersed in a new culture doesn’t often come along in the years after university; and it opens up a whole world of renowned academic institutions. However, it’s easy to fail to consider the benefits from the other side – what about the benefits that international students bring to the country where they’re studying?

We’re not simply talking about cultural enrichment and diversity, although those are all very real and important benefits of having international students. A new study has shown that international students in the UK generate more than £25 billion for the economy, and significantly support local businesses and jobs across the country.

The UK is the second-most popular place in the world for international students to attend university, in large part due to the academic reputation and wealth of its higher education institutions (the only country with more international students is the USA). In 2014-15, the most recent year for which statistics are available, there were 437,000 international students in the UK: almost a fifth of all students. 

As a significant proportion of the student population, perhaps it’s not surprising that international students contribute so much to the UK economy. But beyond tuition fees – which are significantly higher for non-EU students – the knock-on effect of students from a different country attending university in the UK is vast.

The headline figure of £25 billion does include tuition fees, to the sum of £4.8 billion, but it also includes other, perhaps more unexpected contributions. The economic impact of international students supports over 200,000 jobs around the UK, as it isn’t just the students doing the spending – international students also tend to have a significant number of visitors during their time at university, and those visitors spent an estimated £520 million in 2014-15. This generated approximately £1 billion in gross output across many sectors of the economy.

Students spend money on- and off-campus on all sorts of goods and services. English language training schools are a particular beneficiary of international student spending, according to government research: between 2004 to 2009, the number of students registered at these schools grew by almost 50%, from just under 100,000 to over 150,000. Over the same period, income from training fees also increased dramatically, by 92% – that means their income almost doubled in just five years.

The transport and retail sectors had the biggest boost from international students. Their spending added £750 million to the transport industry in the UK, and £690 million to retail: almost £1.5 billion in total. Their spending, at university and off-campus, also provides an export boost to the UK to the amount of £10.8 billion – almost a third of the value of all business and professional services exports in 2014-15.

The study, which was carried out by Oxford Economics for Universities UK, also demonstrated that the impact was not limited to London, but spread across the regions of England. The development of regional economies has been a key focus of government spending for several years, and this data shows that international students deserve to be considered a key part of that strategy in the future.

“This is not something limited to London or to one or two big cities, but to towns and cities across the UK,” Dame Julia Goodfellow, the President of Universities UK, said. “It is important to remember that international students also 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.” Goodfellow’s message was clear: the UK should welcome more international students to its universities, not fewer. While the current government pledges to restrict numbers of overseas students and introduce controls linked to institution and course “quality”, it’s clear that international students, both EU and non-EU, are absolutely vital to the UK’s continued economic success.


You can download the full study here.

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