Scottish universities are one of our most prized assets renowned for their internationally leading research capacity, cutting-edge innovation and high-quality teaching. I am in no doubt of the reasons that international students make Scotland and the UK their first place of choice to study, live and work. For us, they bring cultural, social, and economic benefits to our world-class institutions, enrich the learning experience for all students and provide our home students with a vital link in deepening our understanding of the world.
From an economic perspective, I take great pride in the global reputation of Scotland’s higher education system which should be considered as one of our greatest economic assets. Scotland’s and the UK’s ability to attract greater numbers of international students over the last five years has been a major economic success story.
That’s why an internationally competitive package for overseas students is a key component of a thriving economy. In Scotland alone, international students have added between £4 – £6 billion to Scotland’s economy since 2019, a ringing endorsement of Scotland’s global attractiveness and influence.
From a UK-wide perspective, international students contribute £41.9bn to the economy and even when accounting for the impact on public services which is estimated at £4.4bn, the economic benefits of hosting international students significantly outweigh the costs with a total net benefit of £37.4bn to the UK economy.
The sector is one of the UK’s most important and successful exports. For every 11 non-EU students, £1m worth of net economic impact is generated for the UK economy.
Whilst Scotland continues to remain a popular choice for study, prospective students are faced with an increasing number of destinations to choose from with competition from countries such as Canada and Australia intensifying as both countries offer more attractive options for graduate work options after studying. We are already falling behind the list of closest competitors with recent decisions by the UK Government’s making the UK a less competitive and viable option for the international student market.
The specific decision to remove the ability for postgraduate students to bring family members to the UK whilst studying has already hit application numbers in Scotland with the Russell Group reporting a 10% drop in the number of international students applying to postgraduate taught courses starting in September.
According to a survey by the British Universities’ International Liaison Association, the drop in applications is nearly three times bigger across the sector as a whole. A similar drop in enrolments for courses would cost hundreds of millions of pounds.
Restricting the number of international students that can come to the UK is unnecessary and causes harm to our universities, our global standing and the ability of our businesses to grow.
One of the most pressing issues for firms is the competition for skills and talent. The fight for talent is not simply a local one but a global one and our economy relies on access to an internationally accessible skilled talent pool.
That’s why the decision by the last UK Government to increase the wage threshold for a company hiring someone under the Skilled Visa route is problematic. This is a more pronounced challenge for Scottish businesses as the salary threshold is UK-wide rather than weighted to the average salary in each nation.
Under new rules, the earning threshold has increased dramatically from £26,200 to £38,700, a staggering 48% increase and a level far beyond the Scottish average wage.
For many firms, this route is now effectively closed given the tighter restrictions and exceptionally high salary requirements and will exacerbate the issue of labour market supply and skills shortages.
My conversations with Scottish businesses on this policy matter has made it clear that our offering to international students is critical for our ability to grow our economy, attract investment and maintain our place on the world stage. Reviewing and adapting immigration processes and requirements are important debates to have but not to the detriment of our economy and we must not forget how important international students are to our economic future.
Now is the time for Government to side with business and adopt a clear narrative that we are open for business with the world.
By Dr Liz Cameron CBE
Chief Executive of the Scottish Chambers of Commerce
First published in the Courier, May, 2024
