Every 10 international students who choose to study in the United Kingdom (UK) generate £1 million in net economic benefits for the country.
This was made known in a report published by the Higher Education Policy Institute (HEPI) and Kaplan International Pathways.
The comprehensive analysis on economic benefits, produced by London Economics, revealed that the 2024/25 cohort of 404,500 international higher education students will inject a total of £45.1 billion into the UK economy over the course of their studies.
After factoring in an estimated £4.7 billion cost to public services—such as healthcare, housing, and infrastructure—the net economic gain stands at £40.4 billion, yielding an impressive 9.7 to 1 benefit-to-cost ratio.
However, the report carries a stark warning for policymakers. Strict immigration changes and a shifting global market have triggered a 12% drop in first-year international enrolments since 2022/23, costing the UK economy an estimated £2.9 billion in lost revenue from this cohort alone.
It follows a series of policies impacting international students in the country over the past few years – including a ban on dependants, an upcoming levy on international student fees and stricter compliance requirements for universities.
For the first time, the report uses detailed data on students’ term-time addresses to calculate local economic benefits, finding that the benefits of international students are distributed across every nation and region of the UK.
On average, international students contribute a net £62m to each parliamentary constituency, equivalent to around £580 per resident.
The report also found that the overall economic contribution of international students has increased by £4.1 billion since the 2021/22 cohort, rising from £36.3 billion to £40.4 billion after adjusting for inflation.
But researchers cautioned that the recent decline in international recruitment threatens the UK’s position in an increasingly competitive global market.
Linda Cowan, managing director at Kaplan International Pathways, said the UK could no longer rely solely on the global reputation of its universities.
“In an increasingly competitive international market, which has seen the ‘Big Four’ study destinations expand into a broader group of more than a dozen leading global education destinations, a positive and welcoming environment is essential if the UK is to remain a leader,” she said.
Cowan said that the UK must be careful not to become too “inward-looking” as student choice diversifies beyond the UK, US, Australia and Canada – traditionally the most in-demand study destinations – as immigration policies mean that the ‘big four’ is increasingly becoming “language of the past”.
“There’s a real chance that so many other countries become much more dominant… and become the place of choice for students,” she warned.
Immigration is a top concern for voters in Britain, and the debate around immigration policy must be informed by evidence
A striking part of the research is the consistency with which students contribute to local economies around the country rather than just in certain geographical pockets, Cowan told The PIE, suggesting that international education can play a key part in the UK’s growth agenda nationwide.
She said that the government had a key role to play in ensuring international education continued to support the UK’s growth ambitions by providing “a stable, competitive and welcoming policy environment”.
Rose Stephenson, HEPI’s director of policy and strategy, said the findings should help inform ongoing debates around immigration policy.
“Immigration is a top concern for voters in Britain, and it is important that the debate around immigration policy is informed by evidence,” she said.
“This report shows that international students generate very substantial benefits for the UK economy and underpin the financial sustainability of many universities.”
Stephenson argued that if ministers chose to reduce international student numbers further, “they should be clear that there will be economic costs as well as potential political benefits”.
