Impact of tuition fees for international students assessed

A number of reports published over the last few years point to the significant economic impact of the decision taken in 2011 to introduce tuition fees for international students at Swedish universities.

Since 2011, the number of fee-paying students has grown by close to 500%, from 1,469 in 2011 to 8,820 in 2021. If the trend continues, fee-paying international students will number 10,000 in 2023 and account for 25% of all international students in Sweden.

According to the Swedish Institute, in 2018-19 new fee-paying international students contributed an estimated SEK1.1 billion (about US$97 million) to the Swedish economy. The figure was based on tuition fees in Sweden for international students and the Swedish Migration Agency’s calculation of living costs in Sweden.

Course fees for international students at Swedish universities currently vary between SEK80,000 (US$7,000) and SEK140,000 per year (US$12,400). However, elite institutions like the KTH Royal Institute of Technology in Stockholm and the Royal College of Music charge around SEK255,000 (US$22,500) a year.

Swedish universities now offer more than 1,000 English-taught programmes, with some of the most popular subjects being engineering, IT, life sciences and business. Sweden also has a strong reputation in design and areas such as international relations and human rights.

Economic impact

A July 2022 report commissioned by the Swedish Institute from consulting firm WSP on the economic impact of international students estimated that in 2020-21 the impact of international students on the Swedish economy amounted to between SEK3.5 billion (US$309 million) and SEK4 billion (US$353 million), depending on the scenario.

The report said that both paying and non-paying free-mover students (not exchange students), accounted for 90% of this impact, ie, SEK3.2 billion to SEK3.6 billion. The economic impact of paying free-mover students accounted for SEK1.9 billion.

According to the report, 12% of fee-paying students in 2020-21 had a grant from Sweden that covered their entire tuition fee, while 20% had a grant covering the fee partially, meaning that two-thirds of students were paying the full tuition fees. The proportion of students with a grant from their home country is not registered in the statistics.

Also, in the percentage of free-mover students, which is much larger than the student exchange group, the proportion of fee-paying students increased from 25% in 2011 to 86% in 2020-21, meaning that only 1,331 international free-mover students did not pay tuition fees in 2020-21, the majority of these being from the European Union or the European Economic Area.

In the study year 2020-21, which was marked by COVID, the number of international students in Sweden was 33,300, a reduction from the year before of 6,310 students or 16%. Since the number of Swedish students increased, this led to a decrease in the percentage of international students from 9% to 7% of the total.

While the number of exchange students was reduced by 53% in that year, from 13,130 to 6,160, the number of free-mover students increased from 26,500 to 27,180, meaning that in the year 2020-21 free-mover students accounted for 82% of international students compared to 67% the year before.

Graduates who stay for work

The WSP report also tried to estimate the economic impact of international students who graduate from a Swedish university and stay on to work in Sweden.

WSP economists found that during the period 2011-12 to 2020-21 more than 70,000 degrees/exams were passed by international students in Sweden, corresponding to more than 10% of all degrees in the same period.

The report noted that international masters degree students constituted more than 40% of all degrees taken during the decade 2011 to 2021, corresponding to more than 4,000 per academic year.

It was estimated that in 2021 more than 12,300 international students who completed a degree from a Swedish university during 2011 to 2021 still lived in the country and had a significant impact on the Swedish economy amounting to billions of SEK. It was estimated that 7,200 of them had a masters degree.

The report notes there is strong potential for increased economic effects and increased labour market supply if more students are able to stay and start their professional career in Sweden.

Among the reasons for international students leaving Sweden after graduation, the report lists: complicated regulations, lack of contacts with the labour market, low wage levels, lack of knowledge about recruitment processes and the Swedish labour market, and insufficient support from Swedish higher education institutions.

Oxford Economics report

A report from economic adviser Oxford Economics commissioned by the Association of Swedish Higher Education Institutions (SUHF) in 2020, titled Multiplying Economic Value: The impact of Swedish universities, confirms the impact of international students on the Swedish economy.

“Adding all of these employment impacts, we find that the activity of universities, the international students they attract and their visitors, supported more than 121,000 jobs in Sweden in 2017-18.

“This was equivalent to 2.4% of all employment in Sweden. To give a sense of scale, this was larger than the entire population of Örebro, the seventh largest city in Sweden and one of the largest inland hubs of the country,” the report states.

Those institutions known to attract high numbers of fee-paying students include Lund University, which had 1,636 fee-paying students in 2019-20 – approximately 4% of all students – and earned SEK136 million in 2020.

But Lund was still second to KTH Royal Institute of Technology which earned SEK155 million in fees, followed by Uppsala University with SEK121 million.

Quality issues

The quality of international courses in Swedish institutions came under intense scrutiny in 2014 when international student Connie Dickinson (now Askenbäck) successfully sued Mälardalen University College for delivering a fee-based masters course in international finance that was not of sufficiently high quality.

The case was perceived as instrumental in raising awareness of the need for courses offered to fee-paying students to comply with quality assessment criteria.

In a 2019 report titled International Students in Sweden: Before and after the introduction of tuition fees, André Bryntesson and Mikael Börjesson argued that after the introduction of fees, higher education institutions “may have been forced to make more of an effort in order to be internationally competitive, since it has clearly become more challenging to recruit third country students”.

However, many of the challenges facing Swedish higher education institutions when it comes to international competition – such as language, climate, housing and the labour market – lie outside the power of higher education institutions to change.

“The current tuition fee system does not formally leave much room to adjust the price according to the status and attractiveness of particular programmes or courses. It is possible that high-status institutions or programmes would stand to gain from charging higher fees, since price is sometimes perceived by students as an indication of quality,” Bryntesson and Börjesson said.

However, Bryntesson told University World News he was not aware of any “reliable and precise way” to measure a link between an increase in academic quality and the imposition of fees.

“And if a change could be identified, it would be very hard to attribute it to tuition fees. I believe tuition fees have had both positive and negative effects on the quality of students, teaching and learning. Whether more positive or negative, I cannot tell,” he said.

Dr Jérôme Rickmann, senior advisor of global engagement at Aalto University in Finland, whose PhD at Università Cattolica del Sacro Cuore in Milan focused on tuition fee processes in Sweden, said his research would not support claims of a link between tuition fees and academic quality at Swedish universities.

No support for a general claim

“Based on my PhD thesis, I would not make such a general claim.

“Generally, one can relatively safely say that the majority of organisational change at Swedish universities has happened within administration and services, not so much in research and education.

“If something changed and how substantial the change was in the ‘academic heartlands’ differs from institution to institution and within the institutions from programme to programme. So, I think it is rather the other way around – it is difficult to claim that the introduction of fees would automatically negatively impact academic quality from a longitudinal perspective.”

Agneta Bladh, immediate former chair of the Swedish Research Council, who chaired the internationalisation investigation in Sweden in 2018-19, told University World News the number of non-European international students in Sweden “decreased a lot” when tuition fees were introduced 2011.

“After some years the number of non-European students began to rise. This is very good for Swedish higher education institutions as the diversity of students improves if several countries are represented in the student population. We hope that the international students will have benefited from the fees paid.”

Bladh said the Mälardalen University College case contributed to “a higher consciousness of the importance of always upholding a high quality in all courses offered to international students as well as Swedish students”.