UK loses nearly $4B as international student numbers fall: report

A decline in international student enrolment has cost the U.K. economy an estimated £2.9 billion (US$3.89 billion), according to a new report highlighting the financial contribution overseas students make to the country. The research, conducted by consultancy London Economics and commissioned by the Higher Education Policy Institute (Hepi) and Kaplan International Pathways, estimated that the number of first-year international students in 2024-25 had dereased by around 54,500 students, or 12%, over the past two academic years as a result of changes in immigration policy, including restrictions on dependent visas.The drop in students has resulted in a loss of £2.9 billion to the economy, it found.A total of 685,565 international students began their U.K. higher education courses in 2024-25.According to the analysis, which measured the economic impact of international students by combining tuition fee income, students' living expenses, and spending by visiting relatives and friends, the average net economic contribution is approximately £100,000 per international student.Although the 2024-25 cohort will take away around £4.7 billion from the U.K.'s public budget through spending on services such as healthcare and public safety, they will generate total economic benefits of £45.1 billion over the course of their studies, it found.This results in a net economic benefit of £40.4 billion for the U.K., representing a benefit-to-cost ratio of 9.7 to one, according to the study. Locals and tourists in London. Photo by Pexels International students have faced increasingly strict immigration rules, including new restrictions on bringing family members to the U.K.Starting in January, the U.K. will shorten the post-study stay period for international bachelor's and master's graduates from two years to 18 months.The government has also raised the financial proof requirements for student visa applicants. Students must now show between £1,171 and £1,529 per month for living support, depending on where they study.According to the report, the economic gains from international students are spread across the country, though some parliamentary constituencies benefit more than others.The constituency of Holborn and St Pancras, represented by outgoing Prime Minister Keir Starmer, ranked highest. There, more than 11,500 international students contribute over £1 billion to the U.K. economy.Makerfield, the constituency of likely future Prime Minister Andy Burnham, recorded a net benefit of about £4 million.Clacton, where Nigel Farage is expected to contest a by-election after stepping down as an MP, saw a net economic contribution of £2.1 million.Rose Stephenson, Hepi's director of policy and strategy, said the report provides important evidence for ongoing debates over immigration policy."If ministers decide to further reduce international student numbers, they should be clear that there will be economic costs as well as potential political benefits," Stephenson was quoted as saying in the report.Linda Cowan, Managing Director at Kaplan International Pathways, noted that the international education market is becoming increasingly competitive.She pointed out that the "Big Four" study destinations (the U.S., the U.K., Australia, and Canada) have expanded into a broader group of more than a dozen leading global education destinations.To remain a leader, she said, "a positive and welcoming environment is essential"."The U.K. is home to some of the world's foremost universities, but we cannot rely on reputation alone. We must continue to demonstrate the value of a U.K. education and ensure international students feel welcomed from the moment they consider applying."