International students: Are countries throwing away the gold?

Overviews of the economic benefits of international students, in particular fee-paying students, in the Global North and debates in countries such as Norway about the move towards fees for international students, are “enlightening” for the current debate about the benefits and negative consequences of international student recruitment, says a leading scholar of higher education internationalisation – but the dangers of increasing inequality cannot be ignored.

Responding to the recent publication of several reports on the economic value of international students by countries in the Global North, Professor Hans de Wit, emeritus professor of the practice and distinguished fellow at the Center for International Higher Education at Boston College in the United States, told University World News: “Advocates of international student fees, a coalition of professional associations, national governments and institutional leaders emphasise the benefits for their economies but ignore the negative consequences of increasing inequality at the cost of the Global South and institutions not receiving large numbers.”

He said while they also emphasise “other benefits of having international students to justify their actions”, they tend to “ignore the elitism of their approach”.

However, it was “not that simple to advocate against full cost fees for international students as the solution to inequality and elitism, as argued by opponents in Norway”, he said.

“There is not much wrong about full cost fees for an elite that can afford it. More important is to advocate for scholarships for those international students who cannot afford to study abroad and to establish joint programmes with institutions in the Global South, to break the wall of inequality and elitism in international student mobility.”

De Wit’s comments were made in response to a request from University World News for his impressions of the significance and findings of a slew of fairly recent reports emanating from Global North countries on the economic benefits of international students.

United States: Job creation

One such report, published by NAFSA, the Association of International Educators headquartered in the United States, revealed that the one million international students studying in colleges and universities in America during the 2021-22 academic year had contributed about US$33.8 billion to the US economy and supported 335,423 jobs.

According to the report, for every three international students, one US job is created and supported by spending in the higher education, accommodation, dining, retail, transportation, telecommunications and health insurance sectors.

The objective of the economic value analysis was to use data already collected for other purposes to provide a reasonable estimate of the economic resources that international students import to the United States to support their education there.

The analysis defined economic value as the amount of money that international students studying at US colleges and universities collectively bring into the United States to pay for their education and to support themselves while they (and in some cases, their families) live and study in the United States.

The report revealed that the six states benefiting most from the influx of international students and their economic returns were California (US$5.4 billion), New York (US$4.9 billion), Massachusetts (US$3.1 billion), Pennsylvania (US$1.7 billion), Illinois (US$1.6 billion) and Ohio (US$1.0 billion). These states accounted for 52% of the total income generated from international students and 44% of the total international students studying in the United States.

France: A positive balance

Another report released on 28 November 2022, which surveyed 10,000 international students in France to estimate the economic impact of their presence in the country, indicated that international students contributed up to €5 billion (US$5.4 billion) to the French economy, resulting in a net positive balance of €1.35 billion after considering the related public expenditure.

The survey, conducted by Campus France in partnership with the Kantar Public institute, also revealed the positive long-term impact of international students on France’s image internationally.

This was based on several types of public expenditure, including the share of domestic education expenditure for higher education attributable to international students (€3.1 billion), housing aid (€206.6 million), French government scholarships (€53 million), social security expenses (€247.2 million) and the cost of state services (€86.9 million).

Denmark: Throwing out the gold?

Based on public administrative data from Statistics Denmark, a recent study has revealed that – after deducting costs for education, health, state educational grants (SU) and social benefits – non-Danish students who stayed in Denmark for at least nine months after graduating contributed a total amount of DKK26.4 billion (US$3.8 billion) to the country over a 10-year period from 2007 to 2017, which amounts to DKK2 million for each international graduate.

A recent working paper on university reform written by Professor Susan Wright and Matej Zitnansky of the Danish School of Education at Aarhus University, noted that a cost-benefit analysis by the Ministry of Higher Education and Science showed that “34% of international masters students who graduated in 2014 were employed in Denmark in 2016 and made a positive contribution to Danish finances”.

“All international students, even including those who left Denmark immediately after graduating, each contributed on average DKK100,000 to DKK350,000 to the public finances over a 50-year life course,” the paper noted.

“The ministry concluded that this was a ‘good business’ for Denmark. Yet governments have instructed higher education institutions to reduce places for international students, either by closing courses where English is the medium of instruction or making an A-level qualification in Danish an entry requirement. This is in order to prevent EU students from benefitting from Danish student grants, but it also cuts the number of international fee-paying students.

“This action has especially hit humanities and social sciences, and not only has economic consequences for these disciplines but has deleterious pedagogic effects as it is widely recognised that internationalisation is crucial for the quality of education for Danish students.

“Industry has lobbied against these cuts and the new government’s political statement says it will allow 500 to 1,000 new study places for international students in its proposed new one-year ‘industrial masters’ courses in areas targeted towards high labour market demand,” Wright told University World News.

Meanwhile, the Danish Society of Engineers (IDA) called for a new discussion on international students in Denmark with the new Minister for Higher Education and Science Christina Egelund at a conference held on 10 January with the provocative title: “Are we throwing gold in the street? – A conference on the value of international graduates for Denmark”.

The conference sought to tackle the issue of falling youth cohorts and a lack of STEM (science, technology, engineering and mathematics) skills, which is challenging Danish business. “International students contribute vital labour and billions to the economy and are an important part of the solution. So why do we put up barriers?” the conference asked.

The IDA has more than 140,000 members who are primarily engineers, IT professionals and natural science graduates. The conference was attended by students and representatives of Danish business, industry and universities and political parties.

In addition to the minister, speakers included Asbjørn Boye Knudsen, partner in Damvad Analytics, which has conducted an investigation into international students.

Following the conference, Knudsen told University World News that, based on the figures reflecting the economic benefits of international students, allowing more rather than fewer international students into the country made sense.

“In a situation where there is a lack of highly educated labour [such] as engineers in several industries, allowing more international students into Denmark seems like an obvious solution,” he said.

Sweden: Free-mover impact

A July 2022 report commissioned by the Swedish Institute from consulting firm WSP revealed that in 2020-21 international students had an estimated economic impact on the Swedish economy ranging from SEK3.5 billion (US$335 million) to SEK4 billion (US$383 million).

Of this, paying and non-paying free-mover students (not exchange students) accounted for 90%, contributing between SEK3.2 billion and SEK3.6 billion, with paying free-mover students contributing SEK1.9 billion.

United Kingdom: Benefits outweigh cost

A study published in September 2021 by Universities UK International and the Higher Education Policy Institute with research from London Economics, titled The Costs and Benefits of International Higher Education Students to the UK Economy, examined the costs and benefits of international students to the United Kingdom economy in the 2018-19 cohort.

The findings demonstrated that the economic benefits of hosting international students significantly outweighed the costs, including their use of public services. In total, 272,000 students from outside the UK began university courses in 2018-19.

The economic benefit of this cohort to the UK was calculated to be £28.8 billion (US$35 billion), while the costs are found to be £2.9 billion. This yielded a net economic benefit of £25.9 billion spread across the UK, with an average of £390 per person. Analysis of the results revealed that every part of the UK is financially better off because of international students.

Moreover, one year’s intake of international students at British universities generated economic activity worth £390 for each person in the UK each year, rising to more than £700 for every inhabitant of London.

It is estimated that 10 international students arriving from outside the European Union will generate £1 million of net economic impact during their studies.

The nearly £26 billion net total was 19% higher in real terms than similar analysis using figures from 2015-16, mainly driven by the increase in international student numbers.

In 2015-16, 174,000 international students from outside the EU undertook their first year of study in the UK, and by 2018-19 the figure had risen to nearly 208,000. Approximately £4.7 billion worth of net impact originated with EU students, while the remaining £21.3 billion was generated by students from outside the EU.

However, this analysis was conducted when EU students were still eligible for domestic fees and student loans.

Since the completion of Brexit, EU-domiciled students have been charged the same higher tuition fees as international students. This has led to a more than 50% slump in the numbers of EU students accepting places in undergraduate courses in the UK, from 22,000 in 2020 to 9,800 in 2021.

Norway: The fees-for-international-students issue

The Norwegian government proposed last year to introduce tuition fees in 2023 for all full degree students from outside the European Union, the European Economic Area (EEA) and Switzerland.

Critics say it represents a flagrantly discriminatory policy that targets the world’s most vulnerable groups, particularly those in the Global South. They make three important arguments against the introduction of fees:

• Accepting international students without taking fees would bring greater cultural and economic diversity to Norway, which is beneficial for the country as a whole. This would lead to increased collaboration and exchange of ideas and knowledge between institutions and could also lead to increased economic growth.

• Norway has a strong commitment to education and human rights, and welcoming international students without taking fees would demonstrate a commitment to providing access to higher education for people around the world, regardless of their economic circumstances. This would be a powerful statement of Norway’s values and would be beneficial for international relations.

• Allowing international students to study in Norway without taking fees would increase Norway’s global reputation as an attractive destination for students and scholars. This could lead to increased enrolment of international students, which in turn could increase revenue for universities and other educational institutions in Norway.

Beyond economic benefits

Beyond the economic benefits, there are other important considerations to be taken into account when analysing the impact of international students in a country as a whole.

Research shows that international students enhance the diversity of academic publications by bringing diverse perspectives, research interests and experiences to academic publications.

Having a variety of perspectives can provide a more comprehensive view of a topic, which can lead to a better understanding of the issue. Additionally, having a variety of backgrounds in the authorship of an academic publication can provide a more complete picture of the research outcomes.

Having international students involved in academic publications can lead to increased intercultural communication and exchange which can help build bridges between cultures and introduce new ideas, and which can lead to further research and collaboration.

International students can also bring a unique and valuable perspective to research and academic publications that can help to increase global understanding, as more individuals are exposed to different cultures and points of view. This can result in more open-mindedness and knowledge about different cultures and research topics.