Brexit deterred international students from applying to UK universities

Catalina Amuedo-Dorantes, Agnese Romiti 15 May 2021

a

A

On 23 June 2016, the UK voted to leave the EU by a 52:48 split. In March 2017, the UK Parliament confirmed the result of the referendum. After a long negotiation process, the UK officially left the EU in January 2020. One of the hallmarks of the EU is the free movement of people between member countries; Brexit implied an eventual end to this mobility for most European migrants. 

Brexit ultimately affected the costs of studying in the UK by modifying students’ ability to secure loans, introducing visa requirements, and increasing uncertainty whether international students would be able to stay in the country and find employment after they complete their studies. These higher costs could deter prospective students from considering studying in the UK in the first place. 

Aside from the economic costs, Brexit could also deter prospective students from attending college in a country they feel is no longer welcoming of migrants and is discouraging them from remaining after completing their studies. 

Yet, to date, we lack a clear understanding of the implications that Brexit might have had on international student applications to UK universities.

Why should we care?

Understanding how Brexit has affected international student applications to UK universities is critical for various reasons. First, the UK ranks second (after the US) in hosting international students. Before Brexit, international students represented 14% of undergraduate students and 35% of postgraduate students in the UK. Approximately 36% of international undergraduate students were EU nationals (HESA 2016). Attracting international students is of utmost importance, especially for public universities increasingly facing funding cuts, as these students represent an important source of revenue. This is especially the case now, more than ever, given that the British population of 18-year-olds has been shrinking since 2017 (UCAS 2017) – a trend potentially responsible for the recent decline in enrolments of UK students in undergraduate programmes.

Second, attracting international students is vital for enticing and retaining foreign talent, which is critical in fostering innovation and productivity (Hunt and Gauthier-Loiselle 2010 and Stuen et al. 2012). A long-standing literature examining the determinants of student mobility and applications has underscored the relevance of employment and earnings’ aspirations in shaping international student applications (e.g. Dustmann et al. 2011, Rosenweigz et al. 2006, among others), along with costs (Korn 2017), and the availability of funding (Baer 2017). 

More recently, the focus has turned onto policy, especially the effect that more restrictive H-1B visa policies in the US have had on the quality of international student applicants and on enrolments (Kato and Sparbe 2013). Less is known about equivalent effects in the UK. The closest study is Falkingham et al. (2021), which examines how Brexit has affected EU students’ willingness to return home. 

In this column, we discuss new evidence on how Brexit might have altered students’ willingness to study in the UK in the first place, as well as on the potential quality of applicants and the factors likely driving their choices (Amuedo-Dorantes and Romiti 2021).

Finally, gaining a better understanding of the broader implications of Brexit will be vital for quite some time. Recent literature on Brexit has examined the determinants of the Brexit vote. Areas with low educational attainment and incomes, high unemployment, and a historically large concentration of employment in manufacturing were more likely to vote for Brexit (Becker et al. 2017). At the individual level, one of the main drivers were feelings about income rather than actual income (Liberini et al. 2019). 

Other studies have explored how Brexit or its uncertainty affected macroeconomic outcomes (e.g. Bloom et al. 2018, Born et al. 2019, Breinlich et al. 2020, Graziano et al. 2021), as well as public safety (e.g. Carr et al. 2020). Less has been done in terms of Brexit’s effects on student decision-making. We address that gap by assessing how Brexit has affected the volume, as well as potential selectivity, of international applications.

Universities and Colleges Admissions Service (UCAS) data

For our analysis, we use administrative data on the universe of applications to undergraduate programmes in the UK from the Universities and Colleges Admissions Service (UCAS), from 2013 to 2019. UCAS is the body that manages all applications to undergraduate courses in the UK. We consider the number of applications by university, subject, country of origin, and year.

Our findings

Descriptive evidence shows that international student applications to UK universities from EU students stagnated after 2016, whereas applications from non-EU students rose by 14%. Both exhibited a similar upward trend in 2007–2016 (Figure 1).

Figure 1 Average of (log) applications by student origin and over time

Notes: This figure shows the weighted yearly average value of log of applications by country, subject, and university, using the size of the population aged 15–19 in the first year (2007) as weight. Source: UCAS.

This evidence, while revealing, is merely descriptive and may not be interpreted as the causal effect of Brexit. Therefore, we adopt a method widely used in policy evaluation that compares changes in international student applications from EU member countries within source country, university, and subject of study to those from non-EU members, before versus after the UK vote to leave the EU. In this manner, we can gauge the effect of Brexit on international student applications net of both pre-existing differences between EU and non-EU countries and other confounding changes affecting both groups equally over the same time span.

We find that Brexit has significantly lowered applications originating from EU students. Specifically, when compared to international student applications from non-EU students, the growth rate of EU applications dropped by 14% following the Brexit referendum. Additionally, we rule out anticipation effects, as changes in the volume of international student applications from the EU did not precede the Brexit referendum; rather, they occurred right after, persisting during the three-year period that followed.

The effect of Brexit varies by subject of study and selectivity of the academic institution. Applications for science, technology, engineering and mathematics subjects, along with those to more selective institutions – like those part of the Sutton Trust group – declined the most, by 17% in both instances. These findings hint at positive selected prospective students choosing to apply elsewhere.

Finally, we also find evidence of substantive drops in international student enrolments in addition to applications, substantiating concerns regarding the ability to attract international talent.

What might be driving the observed changes in the volume of applications?

We explore two potential explanations for our findings. First, we consider the role played by psychological factors, as captured by a potentially unfriendly environment towards EU residents after Brexit. Secondly, we ponder the role of economic factors – most notably, the curtailed ability for international students to stay long term in the UK and find employment upon completion of their studies.

We find that the impact of Brexit has been mostly homogeneous across UK regions, regardless of whether they voted to leave or to remain in the EU. This finding suggests that concerns regarding possible xenophobic sentiments did not play much of a role in shaping international students’ decision or that students were unaware of how the various UK regions voted. 

However, economic factors might have played a role, as evidenced by the fact that Brexit most curtailed international student applications from EU countries with lower per capita GDP and higher unemployment rates. Those are students who would have had more to gain and, in turn, been presumably more interested in staying in the UK after completing their studies, to live and work.

Policy implications

Our findings on the impact of Brexit on international student applications are worrisome. The effects are non-negligible and, ultimately, result in lower international student enrolments. Furthermore, the results suggest that student selection patterns can have significant implications for innovation and economic growth. 

Given the contributions of international students to economic activity and innovation, and the prominent standing of the UK as a destination for international students, particularly from EU member countries, further research on the implications of Brexit for UK universities is well warranted. The international students’ contributions, both demographically and economically, can prove key in fostering a young, vibrant, and diverse society.

Authors’ note: The authors acknowledge financial support from the Center for Growth and Opportunity at Utah State University.

References

Amuedo-Dorantes, C, and A Romiti (2021), “International student applications in the United Kingdom after Brexit”, IZA DP No. 14247.

Baer, J (2017), “Fall 2017 international student enrollment hot topics survey”, Institute of International Education Center for Academic Mobility Research and Impact.

Becker, S O, T Fetzer and D Novy (2017), “Who voted for Brexit? A comprehensive district-level analysis”, Economic Policy 32(92): 601–50.

Bloom, N, S Chen and P Mizen (2018), “Rising Brexit uncertainty has reduced investment and employment”, VoxEU.org, 16 November.

Born, B, G J Muller, M Schularick and P Sedláček (2019), “The costs of economic nationalism: Evidence from the Brexit experiment”, The Economic Journal 129(623): 2722–44.

Breinlich, H, E Leromain, D Novy and T Sampson (2020), “Voting with their money: Brexit and outward investment by UK firms”, European Economic Review 124: 103400.

Carr, J, J Clifton-Sprigg, J James and S Vujiċ (2020), “Love thy neighbour? Brexit and hate crime”, IZA DP No. 13902.

Falkingham, J, C Giulietti, J Wahba and C Wang (2021, forthcoming), “The impact of Brexit on international students’ return intentions”, The Manchester School 89(2): 139–71.

Graziano, A, K Handley and N Limão (2021), “Brexit uncertainty and trade disintegration in Europe and beyond”, VoxEU.org, 26 January.

Hunt, J, and M Gauthier-Loiselle (2010), “How much does immigration boost innovation?”, AEJ: Macroeconomics 2(2): 31–56.

Kato, T, and C Sparber (2013), “Quotas and quality: The effect of H-1B visa restrictions on the pool of prospective undergraduate students from abroad”, The Review of Economics and Statistics 95(1): 109–26.

Korn, M (2017), “Foreign student surge starts to ease off”, Wall Street Journal, 13 November.

Liberini, F, A J Oswald, E Proto and M Redoano (2019), “Was Brexit triggered by the old and unhappy? Or by financial feelings?”, Journal of Economic Behavior and Organization 161: 287–302.

Rosenzweig, M R, D A Irwin and J G Williamson (2006), “Global wage differences and international student flows”, Brookings Trade Forum, pp. 57–96.

Stuen, E T, A M Mobarak and K E Maskus (2012), “Skilled immigration and innovation: Evidence from enrolment fluctuations in US doctoral programmes”, The Economic Journal 122: 1143–76.

UCAS (2017), “January deadline analysis: Overview”, blog article.

a

A

Topics:  Education Europe's nations and regions Migration

Tags:  Brexit, education, EU, foreign students, higher education, International students, mobility, UK, Universities

Professor of Economics, University of California, Merced

Assistant Professor in Economics, University of Strathclyde - Glasgow

Events

CEPR Policy Research