New research, to be presented at the annual conference of the Royal Economic Society, finds that the outcome of the 2016 Brexit referendum (hereafter, “Brexit”) curtailed the growth rate of international student applications to UK universities.
Brexit implied an end to the free mobility of goods and people between the UK and EU member countries, raising the economic and psychological costs of studying in the UK for international students from countries in the EU. Greater economic costs stemmed from higher student fees, the inability to secure loans, the need to secure visas, and uncertainty regarding students’ ability to stay in the UK to live and work on completion of their studies. In addition, Brexit might have deterred prospective students from moving to a country they feel is no longer welcoming to migrants.
Understanding the impacts of Brexit on international student applications is key, given the estimated contribution of international students to UK universities, which amounted to £17.6 billion in 2015 (Migration Advisory Committee, 2018), and the growing reliance of UK universities on those revenues. In addition, a reduction in EU students might have implications for innovation and growth, given that they represented 36 percent of international undergraduate students prior to Brexit.
The research was carried out by Catalina Amuedo-Dorantes of UC Merced, and Agnese Romiti of the University of Strathclyde. Their findings are based on administrative data that include the “universe” (the complete set) of undergraduate applications to UK universities. These can be summarised as follows:
First, Brexit curtailed the growth rate of international student applications by seven percent, even before tuition fees had changed. These changes in the volume of international student applications from the EU did not precede the Brexit referendum; rather, they occurred in response to Brexit and persisted over the following three years.
Second, Brexit had similar impacts on international student enrolments of selective and less selective institutions of higher education; however, its impact varied across the fields of study, with a larger effect on sought-after international STEM applicants. Specifically, Brexit reduced the growth rate of EU applications in STEM fields by ten percent, relative to a five percent reduction in the growth rate of EU applicants to non-STEM fields.
Finally, the researchers explore the mechanisms behind the observed changes in international applications. The findings suggest that economic factors – exemplified in student perceptions of the chances to find employment in the UK, after completing their studies – have played a more decisive role in application decisions than psychological factors, embodied in student perceptions of how welcoming the country might be.
Brexit appears to have significantly lowered applications among students originating from countries with relatively low GDP per head and low employment rates – by 11 percent and by 14 percent, respectively. This differential effect suggests that reduced opportunities for students to live and work in the UK after completing their studies may have played an important role in the decline in applications.
In sum, Brexit has had non-negligible negative effects on university applications, mirrored by similar (though slightly smaller) effects on final enrolments. Given the contributions of international student enrolments to UK institutions of higher education, and to innovation and growth, more research seems warranted, to investigate what Brexit has meant for the ability of UK institutions to attract talent.
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