Benjamin, as he explains, is an American who is about to start his PhD at Cambridge. Theresa May’s policy is about number targets and not about economic sense. The Scottish government has long argued that we need to allow talented overseas students to stay in Scotland after they have graduated. They bring their skills and innovation with economic advantage and job creation opportunities. Forcing them to leave is economically illiterate as well as being unwelcoming, damaging to international relations and reputation
Benjamin’s post Britain: For the Love of God, Please Stop David Cameron before the UK general election went viral. Unfortunately people in England were not listening.
Guest post by Benjamin Studebaker
UK Home Secretary Theresa May has a new proposal that would force international students at British universities to leave the country immediately after graduating, making it far more difficult for them to get work visas and remain in the UK. I was reluctant to write about this because I myself could be personally affected–I’m starting a PhD at Cambridge this autumn, and I am certainly interested in the possibility that I might get a job in the UK when I finish.
I generally try to avoid topics where I have a significant personal stake that might bias my analysis. But in this case, the arguments against the policy are too clear and too definitive. Even if you ignore the interests of foreign students like me, this is an irrational policy that does unequivocal, quantifiable harm to Britain.
May points out that last year, 70,000 foreign students elected to stay in the UK upon completion of their courses. She says this as if it were somehow a bad thing. The social science research on this point is very clear–immigrants are economically beneficial, especially if they are highly skilled and well-educated.
In the United States, the Congressional Budget Office (CBO) recently evaluated a now-defunct immigration reform bill that would have increased US immigration figures by 10.4 million over the next decade. These immigrants would have come primarily from Latin America, and most of them would have been low skill workers with minimal educations. Most would not have college degrees, and those that did mostly not have gone to prestigious universities on the level of the Russell Group or Ivy League.
Nonetheless, the CBO found that these immigrants would generate $459 billion in revenue over that decade while consuming a mere $262 billion in benefits and public services. That’s a net saving of $197 billion, which could be used to avoid austerity, fund new programs, or cut taxes. On a per person basis, each immigrant would save the government nearly $19,000 over the ten year span:
These are predominately uneducated, low skill workers. British international students are nothing of the sort–they have some of the best training money can buy. They also come from affluent backgrounds–foreign students are charged twice as much in tuition fees as their British counterparts.
But even if we assumed that the average international student is no more productive than the average Latin American immigrant, the savings would be significant for Britain. If Britain gains 70,000 international students per year for 10 years, it accumulates 700,000 international students each decade. At the same rate of return as the American immigrants, these students would save the British state $13.2 billion (₤8.46 billion) in the next decade alone.
international students can generate
at least $66.2 billion (₤42.43 billion)
in net savings for Britain over
the course of their working lives.
What’s more, international students overwhelmingly come to Britain at the beginning of their working lives. Each one likely has 50 years of economic contributions, which means a decade’s worth of international students can generate at least $66.2 billion (₤42.43 billion) in net savings for Britain over the course of their working lives.
And again, let me emphasize–this analysis does not even take into consideration the difference in productivity between the average Latin American immigrant and the average UK international student. The British university system is excellent, and the students who emerge from it likely make substantially larger economic contributions.
May should also learn from British history. In the 19th century, it was widely known that Britain immensely benefited from the immigration of disaffected European workers. In The National System of Political Economy (1841), Friedrich List writes:
Great, however, as have been the advantages heretofore mentioned, they have been greatly surpassed in their effect by those which England derived from immigrations attracted by her political, religious, and geographical conditions.
As far back as the twelfth century political circumstances induced Flemish woollen weavers to emigrate to Wales. Not many centuries later exiled Italians came over to London to carry on business as money changers and bankers. That from Flanders and Brabant entire bodies of manufacturers thronged to England at various periods, we have shown in Chapter II. From Spain and Portugal came persecuted Jews; from the Hanse Towns, and from Venice in her decline, merchants who brought with them their ships, their knowledge of business, their capital, and their spirit of enterprise. Still more important were the immigrations of capital and of manufacturers in consequence of the Reformation and the religious persecutions in Spain, Portugal, France, Belgium, Germany, and Italy; as also of merchants and manufacturers from Holland in consequence of the stagnation of trade and industry in that country occasioned by the Act of Navigation and the Methuen Treaty.
Every political movement, every war upon the continent, brought England vast accessions of fresh capital and talents, so long as she possessed the privileges of freedom, the right of asylum, internal tranquility and peace, the protection of the law, and general well-being. So more recently did the French Revolution and the wars of the Empire; and so did the political commotions, the revolutionary and reactionary movements and the wars in Spain, in Mexico, and in South America. By means of her Patent Laws, England long monopolised the inventive genius of every nation.
Clearly May should not be attempting to kick out international students–if anything, she should be inducing them to stay. So why is she throwing away all of this productive labor, future innovation, and tax revenue?
To placate racist and xenophobic voters, the Tory government has made arbitrary promises to reduce the UK net migration rate below 100,000. This is an economically destructive policy, but British voters don’t know that. They think international students take their jobs or scrounge for benefits, when the reality is that international students contribute to the economy and create jobs for British citizens.
Maybe the Tories know this, maybe they don’t. Either way, they have to pander to these voters if they don’t want to lose them to UKIP. EU rules prohibit the government from blocking EU immigration, and the EU accounted for 268,000 immigrants to the UK in the last year alone. So if the government wants to come anywhere close to its net migration target, it must go after non-EU immigrants.
International students are an easy target–they’re young people with limited political influence. They come from affluent backgrounds, so they don’t engender much public sympathy. This makes them easy meat for sacrifice to the little Englanders.
From the British businesses that need highly skilled workers to the British government that needs the tax revenue, no one benefits from this policy. It is a policy grounded in ignorance and nothing else.
“Those international students who do leave
often continue to feel warm fuzzies about
Britain long after they’ve gone”
There are other negative consequences. International students are less likely to choose British universities in the first place if they know they are unlikely to be able to stay and feel unwelcome.
With tuition fees that are twice as high, international students subsidize the university system for everyone else, saving British students and the government a great deal of money even before they start work. Those international students who do leave often continue to feel warm fuzzies about Britain long after they’ve gone, and this pays unquantifiable dividends to the UK down the line.
All of this is threatened by policies that make the UK seem deeply hostile to the outside world. But none of these arguments are even necessary–the sheer amount of revenue that international students contribute when they do choose to stay in the UK is entirely sufficient to justify a robust rejection of this policy.
So if you’re one of my British readers, I ask you to please share this post and make it clear to your government in whatever way you can that you want Britain to keep the billions in net revenue gains that international students contribute. Those of us who choose to stay do so because we develop a deep affection for Britain and for the British people. We love your country and we want to contribute to its future. Is that really so horrible?