International university students
Let’s not shoot ourselves in the foot again.
The UK government sometimes seems to want to make us poorer. The most egregious failures have been joining the EEC late, and later leaving the EU. But there are many other failures - and the current government might be about to join many previous governments in making us poorer.
According to YouGov, immigration is the #2 issue facing the UK. Concern is greatest in the Midlands and North, and lower in the South, Wales and Scotland. It is the #1 issue for people who voted leave, and for pensioners.
There are more than 750,000 foreign students studying in our country. According to the newspapers, the Home Office has this group in their sights. In truth, this would be an easy win for those who want to cut immigration. If we simply abolished the student visa category, we could be confident that this group of people would not come here and immigration would fall by about 750,000. Alternatively, we could make the UK a less attractive place to study, either by raising the visa fee (currently £524) or the fee to use the NHS (currently £776 per year of study), or by reducing the right to work in the UK after graduating. All of these would put some students off coming to the UK.
Let’s consider the effect of fewer students. Obviously our universities would suffer. The amount they can charge UK students is limited by the government, and has fallen a lot in real terms over the last decade. With less money from international students the quality of teaching for UK students would fall, and at least some star researchers would leave the UK for other, better funded countries. Academics are, after all, almost as internationally mobile as footballers.
The effects are much, much wider than that. Take Huddersfield, for example. According to the Kirkless “Top 100”, the top firm in the greater Huddersfield area is US-owned card maker UK Greetings Ltd. They are a £130m turnover company, but much of the turnover is the resale of goods imported from East Asia. In contrast the University of Huddersfield has a turnover of £180m, and will import virtually nothing from East Asia or anywhere else. On the contrary, the university is a major exporter - every foreign student who comes to the UK is an export, because the money they spend on course fees is money that comes into the UK from abroad. I absolutely respect the hard work and entrepreneurship of UK Greetings, but there can be no doubt that the University of Huddersfield is much more important to the local economy, in simple financial terms, even without thinking of the benefits of improving local skills.
Huddersfield is not unique. In recent work with my Public First colleagues we discovered that there are over 100 constituencies where the local university is one of the top three exporters. No other sector is in the top three in more than 100 constituencies. As my co-author, Jonathan Simons says, “in a lot of towns your university is your car plant, it is your steel mill”. Of those 100, 85 are Labour seats.
The over £20bn worth of higher education exports directly support more than 180,000 jobs. Not all are Professors, of course. Universities employ all sorts of people - from librarians to catering staff. Critically, however, university exports are wider than that. Britain is exporting every time a landlord rents an international student a room, everytime time Tesco sells them some groceries, or Wetherspoons sells them a pint. The definition of an export is when money flows into your country: these are exports and we are better off for all of them.
Of course Britain could restrict international student numbers. We could halve the number, and make ourselves £10bn poorer every year, concentrated in Labour held seats. For sure, people want lower immigration - but YouGov say they want prosperity even more. To govern is to choose: my policy recommendation is that the government does not make the UK poorer by curtailing international student migration.
Great explanation - people's ability to think about immigration can be very limited and they struggle to see that their local area is thriving because of some immigration not despite it.
This misses the point of the problem with the current system.
The problem is that a lot of these universities are exporting visas much more than they are exporting education.
And it’s a very wasteful way of selling visas.
Is there any strong evidence that educating the average foreign student at Huddersfield University makes them much more productive than if we just sold them a 5-year visa directly?
Have you accounted for the costs on public services from these extra students?
Have you considered the opportunity cost of the work some these people might have been doing instead of studying?
Have you accounted for the increased housing costs many local renters will have to pay (which are only recouped by a relatively small group of wealthy landlords)?
Have you considered the costs paid by graduates more generally through the devaluation of a British undergraduate degree due to the inflation of the educational signalling currency?
Have you considered the cost to the government of continually propping up these higher education institutions, which apparently must never be allowed to fail?
Have you considered the cost of ever-more education leading to lower fertility, putting a burden on future generations?
Lots of people were employed at Enron, but it was better for the world long-term that they filed for bankruptcy.
If our universities will always ‘suffer’ because of fewer students and more students is the only sensible answer at any given moment, isn’t the logical conclusion that everyone in the world should be studying at Huddersfield University?
Similarly, heroin addict can he said to suffers when you take away their heroin, but in the long term, it’s better to get off it.
A much more multifaceted analysis of the Higher Education sector is required than this. There should be a lot more market-style mechanisms involved to ensure that the value of the education really does pay itself back over the long term.