International students, long the gold standard for developed-world universities, face an increasingly uncertain future as governments look for easy targets to curb rapid immigration.
In Britain, one of the world's largest hosts of international students, the opposition Labour party has vowed to maintain a policy banning international students from coming to Britain with their dependents, which has been the largest source of immigration since 2019. In the Netherlands, the government is proposing to limit the admission of international students to Dutch universities.
In Canada, where one in 40 students is an international student, a government crackdown has forced so-called “puppy mill” universities to close their programs, and in Australia, where the ratio is even higher – one in 33 – the government is proposing to cap foreign enrolments at universities, targeting “shady institutions”.
The impact is already being felt, with aggregate visa data for the first quarter of 2024 showing year-on-year declines of 20-30% in travel numbers to the UK, Canada and Australia, according to IDP Education, a Sydney-listed student placement services and testing company that operates in three markets.
“Students are the easiest group to control in terms of numbers which is why they're at the top of the list for cuts and universities are probably a legitimate political target as they're not a particularly strong constituency,” said Andrew Norton, professor of higher education policy and practice at the Australian National University in Canberra.
Keir Starmer's Labour party, which ended 14 years of Conservative rule in Britain last month, has not decided on immigration policy since winning a landslide election in July. Elections are due in Canada and Australia within the next 14 months.
The government has portrayed the measures as a way to improve education quality and eradicate cheating, but critics say they are also politically motivated, with the coronavirus pandemic sparking a backlash against rapid immigration, which has led to higher living costs and housing shortages.
According to data firm HolonIQ, international education is a roughly $200 billion business worldwide, with the UK, Canada and Australia being the three largest countries. The industry is considered a services export, and it also generates economic benefits beyond tuition fees, as students pay for their housing and living expenses, and often then work and pay taxes in the country where they studied.
The United States is emerging as a winner in a crackdown in other markets: It has overtaken Australia as the most popular study destination for international students, according to an IDP survey of more than 11,500 prospective and enrolled international students.
The number of international students in the US is set to grow 11.5% year-on-year in the 2022/23 academic year, surpassing one million for the first time since the pandemic. President Donald Trump, who is seeking re-election, has said he supports granting green cards to all foreign students who graduate from US universities, although his campaign later said the program would include a rigorous vetting process.
But elsewhere, economic arguments about the benefits of a burgeoning international education sector are giving way to political arguments as the electoral tide turns against immigration.
UK closes 'gateway'
The previous government had taken steps to ensure the sector was used for education and “not a gateway for immigration”, but the new Labour government is looking to review this.
During the election campaign, Labour's shadow minister, Chris Bryant, made it clear that if his party was elected, he would not reverse the ban on international students bringing their dependents into the UK. However, British Education Secretary Bridget Phillipson recently asserted that “for too long international students have been treated as political pawns rather than valued guests” and said this would no longer be the case. “Let there be no doubt: international students are welcome in the UK,” she declared.
The UK has seen an increase in international students over the past decade, particularly from China and India, with a record 679,970 international students coming to study in 2021-2022.
This contributes heavily to the university's coffers, which are increasingly reliant on Britain's diplomatic ties with China and India's growing economy, with an independent study estimating student economic impact at a total of 41.9 billion pounds ($53.5 billion) in the 2021-22 academic year.
The Office for Students, the education industry's independent regulator, said any fall in student numbers could put 202 schools, or 74% of the total, into the red. A review commissioned by the previous government to look into visa abuse by foreign students found little evidence of it.
Businesses have also stressed the need for foreign talent. Executives from Anglo American, Rio Tinto and Siemens signed a letter to former Chancellor Rishi Sunak warning that Britain's immigration policies could undermine the university sector. British universities have stressed that enrolling international students does not come at the expense of domestic students.
Dutch Restrictions
Amid rising xenophobic sentiment across Europe, restrictions on foreign students are perhaps most visible in the Netherlands, where a far-right-backed coalition is pushing for policies to limit the admission of foreign students to Dutch universities.
Dutch universities are famously international-friendly – most classes are taught in English and international students make up a quarter of tertiary students – but a lack of new dormitories and a three-fold increase in international students over the past decade has created a severe shortage of student accommodation.
Facing overcrowding, universities decided in February to limit the number of English-taught degrees and reduce enrolments of international students.
The university's decision is supported by a bill yet to be voted on in parliament that would cap the number of international students in the country, restrict the participation of non-European students in certain programs, and ban active international recruiting at student fairs, except in sectors experiencing severe labor shortages.
Big Dutch companies that rely heavily on skilled foreign talent have sounded the alarm about the restrictions, saying they may move their offices abroad if a host of anti-immigration policies pass. This comes as the country's top technical university is also under pressure from the U.S. over Chinese students, as it is a major supplier to ASML Holding NV, one of the world's leading makers of semiconductor manufacturing equipment.
The central bank governor also warned that international students make a big contribution to the Dutch economy: Non-EU students, for example, contribute up to 96,000 euros ($105,000) each to the Dutch economy during their studies, according to the Netherlands Bureau for Economic Policy Analysis.
Canadian crackdown
In Canada, international students contribute more than CAD22 billion (US$16 billion) to the economy and support about 218,000 jobs.
The new restrictions, which include cutting the number of student visas issued this year by 35% and eliminating perks such as work permit eligibility after graduation, target a subsector dominated by smaller, lesser-known universities.
Munira Mistry, 43, fears she will lose her teaching job at a Toronto university by December amid a government crackdown that leads to cost-cutting.
“It feels like all doors are closing,” said Mistry, a project management lecturer who arrived as an international student from India in 2020 and is still struggling to obtain permanent residency. “We're back to square one.”
Before the crackdown came into effect late last year, 10 small institutions had more international students than Canada's top-ranked institution, the University of Toronto.
As in Australia and the UK, rents have skyrocketed and reports of students being crammed into apartments or surviving on food banks have become common. Opposition Leader Pierre Poiriervre has said he will link the pace of population growth to housing construction, which could result in a further significant decline in international student inflows and overall immigration levels.
Colleges Ontario, an association representing the province's 24 public universities, said spring enrolments, which account for a quarter of all university enrolments, had “drastically declined” and said it expects “profound impacts” to the fall semester, resulting in hundreds of millions of dollars in lost revenue.
“No organization can absorb losses of this magnitude without significantly reducing operations,” the company said in a March statement, adding that this would result in “immediate program halts and a pause in capital investments.”
Australian Law
The stakes are even higher for Australia, where international students are expected to contribute A$48 billion (US$31.6 billion) to the economy in 2023, making them the country's largest services export. About 55% of that money is spent on goods and services outside universities, according to the Sydney Commission, a policy think tank, providing big benefits to local small businesses.
According to S&P Global Ratings, Australian universities rely on international students for more than a quarter of their total operating income, making them among the most reliant in the world.
The government's plan, which includes limits on university enrolments and housing construction requirements, has yet to pass Parliament. But international students are already facing tougher English language standards and increasing visa refusals, and some private universities have been told to stop recruiting fake international students within six months or face having their licences revoked.
According to the Group of Eight Universities, which represents Australia's leading research universities, the fee for an international student visa application more than doubled to A$1,600 in July, making it the most expensive in the world.
Australia's plans threaten to squeeze university revenues, curb research funding and damage the country's international QS World University Rankings, and business lobby groups say the move will create worker shortages in key industries.
Australia's education and training sector is already responding with insolvencies increasing by nearly 90% in June compared to the same month last year, the highest of any sector, according to data from Creditorwatch Pty Ltd. This rate is expected to increase over the next 12 months.
Australia's opposition parties have promised even tougher restrictions without specifying policy proposals. Australian voters are due to vote by May 2025 amid widespread sentiment against rapid immigration. In a May survey, 66% of respondents said immigration in 2023 was “too high,” and 50% wanted the government to cut immigration further.
A parliamentary inquiry into the bill is due to report by Thursday. Because it has bipartisan support, analysts expect it to pass parliament this year, but universities may be able to persuade the government to water down some of the proposals.
“Immigration is fast becoming a key battleground in the run-up to the federal election and the university sector is becoming a scapegoat,” Group of Eight CEO Vicky Thomson said in her opening statement at a parliamentary hearing considering the bill on August 6. “This hasty and inadequate legislation is a classic example of late-stage policy shifting to suit dubious political interests.”
