Is graduate visa vital for UK growth?

04 Mar 2024

Fresh analysis indicates that the implementation of the UK government's International Education Strategy in 2019 has led to a significant increase in international student enrolment in Britain, resulting in a considerable economic boost exceeding £60 billion for the UK economy. 

The analysis conducted by Universities UK (UUK), which utilised data from London Economics, highlights the remarkable economic impact stemming from the rise in international student figures during this period. This timeframe coincided with the introduction of the Graduate visa, enabling students to extend their stay and engage in employment in the UK for a duration of two to three years upon finishing their studies.

The UK government's International Education Strategy was designed with the goal of enhancing the UK's global competitiveness in student recruitment and fuelling growth, countering over a decade of stagnation in international student enrolments. The strategy aimed to attract a minimum of 600,000 international students annually and reintroduced a post-study work offer. These measures collectively contributed to the UK reclaiming its status as a premier destination for international students.

Nevertheless, recent policy directions pose a threat to the ongoing success. The ambiguity surrounding the UK's sustained commitment to the post-study work offer, particularly highlighted by the decision to task the Migration Advisory Committee with reviewing the Graduate route, is influencing the decision-making process of potential students. Additionally, rises in visa fees and the introduction of new constraints on bringing dependents have both contributed to a negative perception of the UK as a preferred study destination.

Stats have shown that uncertainty surrounding post-study work prospects plays a crucial role in the decision-making process of international students. Moreover, findings from a recent survey conducted by UUK indicate a decline in international student numbers, following a peak in 2022/23. The survey, encompassing over 70 universities, unveils a notable decrease in enrolments, particularly among postgraduate taught students. In January 2024, these enrolments were reported to have fallen by more than 40% subsequent to the changes in immigration rules.

As the government's reforms come into effect, most universities are preparing for additional declines in international student numbers this autumn. UUK describes the outlook for September as "bleak," warning of a challenging situation ahead. Additionally, the British Council has cautioned that UK universities are likely to encounter slower growth rates and heightened competition for international students.

What are the people saying?

John Foster, Chief Policy and Campaigns Officer for the CBI said: "International students make a big contribution to local economies right across the UK while they are here. When they go home, they are ambassadors for the UK around the world. Selling a British education is an export success story for the UK. That's why business backed the International Education Strategy and the re-introduction of the Graduate Visa route."

Whilst Vivienne Stern MBE, Chief Executive of Universities UK, said: "Beyond playing a major part in the growth which has made a £60bn economic contribution, the Graduate visa has helped to keep the UK as a top study destination in an increasingly competitive global market, supporting thousands of jobs up and down the country and bolstering the country's reputation and soft power influence. The students who have chosen to study here because of it have helped to make our universities culturally vibrant international places of learning."