US$300 billion economic impact by international students

US$300 billion economic impact by international students

A new report by Study Portals has claimed that a US$300 billion economic impact is made by international students on the world economy, with Indian students set to soon overtake their Chinese counterparts as the biggest source nationality.

The Study Portals report examined the international, economic impact of international students and forecast that while China accounts for the lion’s share of international students presently, India will move into that top spot in the coming years.

At tertiary (university) level, in 2016 higher education as a sector had an estimated US$300 billion economic impact from international students globally; 2016 being the year for which the data is most complete.

The estimated figure includes both the direct impact and the “indirect and induced” economic impact of international students. This indirect impact includes the ripple effect of international students expenditures on jobs, tax revenues and household income (knock-on-effect).

Using data and definitions from the UNESCO Institute of Statistics, this calculation by Rahul Choudaha, PhD, is one of the first calculations to provide a global estimate of this impact. In the past, estimates have been limited to a country level.

International students are defined as degree-seeking students “who have crossed a national or territorial border for the purpose of education and are now enrolled outside their country of origin.”

This definition therefore excludes students enrolled in high-school programmes, non-degree programmes or those participating in exchange programmes.

Indian students to be largest group of international students

The report by Study Portals has shown that Indian students, as well as peers from other lower and middle-income countries Nigeria and Vietnam, are likely to replace China as the key drivers of future international student growth.

While China’s GDP growth is slowing, the nations with some of the most dynamic emerging economies in their respective regions ‘are likely to drive demand in growth’, the report states.

The report found that in 2016 international students contribution to the US economy was US$57.3 billion.

Within this figure, Chinese students contributed US$18.3 billion, Indian students US$8 billion and South Korean students US$3.6 billion.

Of the 971,417 international students in the US in 2016, these three countries made up 32%, 14% and 6% respectively.

In the UK, British institutions of higher education hosted 432,001 international students in 2016. The total contribution was estimated at US$25.5 billion with China, Malaysia and Hong Kong at the top.

While Indian students studying abroad for their tertiary education are currently dwarfed by China: 5.9% compared to 17% in 2016, it is predicted that Indian students will soon be leading those who study internationally.

The report showed that from 2017-2019, applicants from Indian students to study in the UK increased by a total of 30%, and Choudaha predicts this trend will continue.

Photo: Priscilla Du Preez

Kate Frazer - Global Education Times (GET News)

Kate Frazer is a reporter for Global Education Times with a focus on UK/Ireland and North American education news. When she is not writing for GET News, Kate spends her time as an English and Maths tutor, and is currently pursuing her PGCE in Secondary Mathematics.
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