Janice Lozano
International students have a significant impact on the economies of their host countries. The US, for example, has long been the top destination for students looking to study abroad, and international students contributed $45 billion to the US economy in 2018. International students bring both their presence and their tuition payments, with the product being a degree or certificate. They also contribute to the knowledge economy, with 40% of American Nobel Prizes in chemistry, medicine, and physics since 2000 awarded to immigrants. They create jobs, build billion-dollar companies, and invent processes that change the way we live. International students are therefore an essential ingredient in the high cost, high aid models at many selective US colleges.
| Characteristics | Values |
|---|---|
| International students' contribution to the US economy | $45 billion in 2018, $43.8 billion in 2023-24, $44 billion in 2023-24 |
| International students' contribution to the global economy | $370 billion in 2020 |
| International students' contribution to the UK economy | £3.2 billion over 10 years |
| International students' contribution to the Canadian economy | CA$22.3 billion per year |
| Number of jobs supported by international students in the US | 378,175 in 2023-24, 335,423 in 2021-22, 450,000 in 2018-19 |
| Number of jobs supported by international students in the US (in colleges and universities) | 199,087 in 2023-24, 167,711 in 2021-22 |
| Number of jobs supported by international students in the US (from housing, food, and retail spending) | 75,641 in 2023-24, 67,711 in 2021-22 |
| Number of jobs supported by international students in US community colleges | 8,472 in 2023-24 |
| Number of jobs supported by international students in English language programs in the US | 2,691 in 2023-24 |
| International students' contribution to the US economy per student | $35,000 in 2021-22 |
| Number of billion-dollar US startups with a founder who was an international student in the US | 143 in 2022, up from 21 in 2018 |
| Percentage of US companies valued at $1 billion or more founded by international students | 25% |
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What You'll Learn
- International students' spending on tuition, accommodation, transportation, and food
- The impact of visa applications and the social and political environment
- The long-term effects of fewer international students
- The economic impact on specific states
- The benefits of attracting the world's brightest minds
International students' spending on tuition, accommodation, transportation, and food
International students' spending power is influenced by a variety of economic factors, including the strength of their home country's currency relative to that of their host country, the cost of living in the host country, and the availability of financial aid or scholarships. Their spending on tuition, accommodation, transportation, and food can vary significantly depending on their location, lifestyle choices, and personal financial situation.
Tuition
Tuition fees for international students can vary widely depending on the university and the country of study. In the United States, for example, international students often pay higher tuition fees than domestic students and may not be eligible for the same financial aid packages. Universities in some countries may offer scholarships or financial aid to international students, but these opportunities may be limited.
Accommodation
The cost of accommodation for international students can vary depending on whether they choose to live on or off-campus. On-campus housing is typically more affordable and convenient, but it may not always be available. Renting off-campus can be more expensive, but sharing accommodation with roommates can help reduce housing costs. The location of the university can also impact accommodation costs, with cities like New York, Los Angeles, and Chicago known for their high costs of living.
Transportation
Transportation expenses for international students can include the cost of purchasing or maintaining a car, public transportation fares, or travel costs during breaks. Some universities may provide transportation options and cost estimates on their websites. Taking advantage of student discounts can help reduce transportation expenses.
Food
Food expenses for international students can vary depending on their dietary preferences, the availability of meal plans or dining services on campus, and the cost of groceries in the area. Eating out frequently can be expensive, so cooking at home can help students save money. Groceries are typically the second-biggest expenditure for students, and they may need to purchase extra food during weekends or evenings when dining services are closed.
International students should also be prepared for hidden or unexpected expenses beyond tuition, housing, and food, which can quickly accumulate and cause financial stress. Creating a monthly budget and tracking expenses can help international students manage their spending effectively. Part-time employment is also an option for many international students to supplement their income, but they should be aware of the regulations regarding student employment in their visa status.
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The impact of visa applications and the social and political environment
International students are a significant contributor to the US economy, with their presence and tuition payments fuelling higher education exports and creating jobs. However, the social and political environment can significantly impact their ability to study in the US through visa application processes.
The social and political environment in the US has led to a dynamic and uncertain visa application process for international students. The Trump Administration's focus on immigration and international students has resulted in expanded vetting and screening processes, particularly regarding social media activity. This has caused delays and uncertainty for students, with some feeling unwelcome or targeted.
The State Department's directive to pause student visa interviews and expand social media screening has been criticised as unnecessary and damaging to the US's reputation as a welcoming destination for international talent. Consular officers are now instructed to review applicants' social media accounts for any content deemed hostile to the US, its government, culture, institutions, or founding principles. This has evoked ideological vetting practices of the Cold War, according to some, and raised concerns about chilling legitimate political speech.
The social and political climate has also influenced the eligibility criteria for visa interview waivers. Previously, individuals were eligible if their visa had expired within 48 months; this has now been restricted to visas expired within the last 12 months, leading to longer wait times.
Furthermore, the social and political environment has impacted the types of visas available to international students. There have been discussions about introducing dual intent for international student visa applicants, removing the requirement to prove a plan to return to their home country. Additionally, there is a push to make STEM, healthcare, and medical PhD graduates eligible for an O status, creating a new nonimmigrant status option.
In conclusion, while international students positively impact the US economy, the social and political environment can create challenges and uncertainties for them through visa application processes. These processes are dynamic and subject to change, affecting students' ability to pursue educational opportunities in the US.
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The long-term effects of fewer international students
International students have a significant positive economic impact on the United States. In the 2023-2024 school year, international students contributed $43.8 billion to the U.S. economy and supported 378,175 jobs. The long-term effects of fewer international students in the U.S. could have a significant impact on the country's economy and society.
Firstly, a decline in international student enrollment could lead to a decrease in the number of jobs available. According to NAFSA, international students in the U.S. supported almost 400,000 jobs in the 2023-24 school year. Half of these jobs were within colleges and universities, while the other half resulted from student spending on housing, food, retail, and other living expenses. A decrease in international students could result in job losses in various sectors, including education, real estate, hospitality, and retail.
Secondly, the loss of international students could impact the innovation and entrepreneurship that they bring to the U.S. Over 25% of U.S. companies valued at over $1 billion in 2022 were founded by international students. These companies create jobs and contribute significantly to the U.S. economy. A decline in international students could mean a loss of potential entrepreneurs and innovators, impacting the country's long-term economic growth and competitiveness.
Thirdly, the social and cultural fabric of the U.S. could be affected by a long-term decrease in international students. International students bring diversity, new perspectives, and cultural exchange to campuses and communities. They also contribute to America's scientific and technical research, helping prepare American undergraduates for global careers and fostering longer-term business relationships. A decline in international students could lead to a less diverse and globally-minded society, impacting the country's ability to compete and collaborate on a global stage.
Lastly, the reputation of the U.S. as a top destination for international students and scholars could be at risk. The country's ability to attract global talent has already been impacted by visa restrictions and social and political factors. A continued decline in international students could further damage the U.S.'s reputation and make it harder to attract the world's brightest minds, leading to a potential brain drain.
In conclusion, the long-term effects of fewer international students in the U.S. go beyond economics. The potential impact on employment, innovation, cultural exchange, and the country's reputation as a global education leader are all serious consequences that could affect the country's economic competitiveness and social fabric.
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The economic impact on specific states
International students have had a significant positive economic impact on the United States, contributing $43.8 billion to the U.S. economy during the 2023-2024 academic year, according to the Association of International Educators. This figure is an increase from the $45 billion contributed in 2018, as reported by the U.S. Department of Commerce. The presence of international students in the U.S. supports hundreds of thousands of American jobs, with data showing that for every three international students, one U.S. job is created or supported.
The economic impact of international students is particularly notable in specific states, with California, New York, Massachusetts, Texas, and Illinois being the top five states with the largest economic activity derived from international students. During the 2023-24 school year, about 12.5% of international students in the U.S. were studying in California, 12.1% in New York, 8% in Texas, 7.3% in Massachusetts, and 5.5% in Illinois.
The high tuition fees paid by international students, which are often more than triple the in-state tuition rates, are a significant source of revenue for colleges and universities in these states. For example, the University of California has approximately one international undergraduate for every nine California students, with international tuition fees being significantly higher than domestic fees.
The loss of international students could have a substantial economic impact on these states, as they contribute significantly to the local economies, particularly in college towns. For instance, the University of Wisconsin-Madison could face losses of $100 million, while the university system in Illinois could lose up to $224 million.
Additionally, international students play a crucial role in the American research enterprise, with over half pursuing STEM fields, and they drive entrepreneurship and innovation. The potential loss of international students could negatively affect the quality of student bodies and hinder research and discoveries.
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The benefits of attracting the world's brightest minds
International students have been shown to have a significant positive impact on the economies of their host countries. In the United States, for example, international students contributed $45 billion to the economy in 2018, according to the US Department of Commerce. This contribution rose to $44 billion in the 2023-2024 school year. International students also supported almost 400,000 jobs in the US during the 2023-24 school year, both within colleges and universities, and in the wider economy through spending on housing, food, retail, and other living expenses.
Secondly, international students can contribute to the host country's scientific and technical research, bringing in international perspectives and helping to prepare American undergraduates for global careers. Many international students are multilingual and have experience living in multiple countries, which can further enhance the host country's global competitiveness.
Thirdly, attracting the world's brightest minds can help to foster innovation and entrepreneurship. For example, Shahid Khan, an international student from Pakistan who attended the University of Illinois, went on to develop a more economical way to manufacture single-piece car bumpers with his startup, BumperWorks, and took over the auto manufacturing company Flex-N-Gate. He kept his businesses in the local area, creating many jobs and opportunities for locals.
Finally, attracting the world's brightest minds through international student recruitment can help to enhance the reputation of the host country and its educational institutions. Countries and cities that actively promote themselves as welcoming destinations for international students, such as the UK, have seen a rise in attractiveness compared to those with stricter border controls. By developing a strong international study brand, destinations can showcase their commitment to cultural diversity, education, and talent attraction, which can have positive knock-on effects for investors and businesses.
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Frequently asked questions
International students contribute significantly to the economies of the countries they study in, through tuition fees, living expenses, and the creation of jobs. In the 2023-2024 school year, international students contributed $44 billion to the U.S. economy.
International students can have long-term positive effects on the economy, even after they graduate. They can become successful entrepreneurs and business leaders, and contribute to the knowledge economy of the country.
A country's economy can affect the number of international students it attracts. For instance, the U.S. is a top destination for international students due to its large economy and low unemployment rates.
International students can stimulate the local economies of the areas they study in, through their additional spending. For example, in the UK, cities like Sheffield Central and Nottingham South benefit economically from the presence of international students.
International students can help fill the open spaces in colleges that may arise due to declining domestic enrollments. They also contribute to the financial sustainability of colleges, as their tuition fees are generally higher than those of domestic students.
