The benefits and costs of international higher education students to the UK economy

Every 10 international students generate £1 million in net economic benefit for the UK, according to new research.

International students who began higher education courses in the UK in 2024/25 are expected to generate a net economic benefit of £40.4 billion for the UK over the course of their studies, according to a major new report published today by the Higher Education Policy Institute (HEPI) and Kaplan International Pathways.

The report, The benefits and costs of international higher education students to the UK economy, produced by London Economics, finds that the 404,500 international students who started UK higher education courses in 2024/25 will generate total economic benefits of £45.1 billion over the course of their studies, while costing the public purse an estimated £4.7 billion, resulting in a benefit-to-cost ratio of 9.7 to 1.

The analysis estimates that the average net economic contribution is approximately £100,000 per international student, meaning every 10 international students creates around £1 million in net economic impact for the UK economy.

This report comes amid continuing debate over international student policy as more countries than ever are competing to attract international students.

In addition to the overall UK-level impacts, the results are broken down by parliamentary constituency – see the interactive dashboard with the constituency-level results below. A full table of constituency-level benefits and a map of regional economic benefits are also available in the attached report (pages 68 and 41).

For the first time, the analysis uses newly available detailed data on students’ term-time addresses, providing a more accurate picture of the local economic contribution made by international students across the UK. The findings show that these benefits are spread across all nations and regions of the UK.

The key findings of the report are:

• The total net impact on the UK economy of the 2024/25 cohort of international student entrants (404,500 students) was estimated at £40.4bn across the duration of their studies.
• The total benefit to the UK economy was approximately £45.1bn, while the total costs were £4.7bn. This implies a benefit-to-cost ratio of 9.7 to 1.
• These benefits can also be expressed in terms of the number of full-time equivalent (FTE) jobs supported. In total, the economic activity generated by international students in the 2024/25 cohort supported approximately 287,300 FTE jobs in the UK.
• The net economic impact per student was estimated at £100,000 per international student. In other words, every 10 international students contribute £1m to the UK economy over the duration of their studies.
• The net economic impact has increased by £4.1bn since 2021/22, from £36.3bn for the 2021/22 cohort to £40.4bn for the 2024/25 cohort (on a like-for-like basis and adjusted for inflation).
• However, the number of international first-year students coming to the UK has declined by ca. 54,500 (12%) since 2022/23. If the 2022/23 student numbers had been sustained in 2024/25, the net impact would have been approximately £2.9bn higher. In other words, the effective economic loss from the recent drop in international students stands at £2.9bn (for the 2024/25 cohort alone).
• The economic impact is spread across the UK. On average, international students make a £62m net contribution to the UK economy per parliamentary constituency. This is equivalent to £580 per member of the resident population.

Linda Cowan, Managing Director at Kaplan International Pathways, said:

In an increasingly competitive international market, which has seen the ‘Big Four’ study destinations (the US, the UK, Australia and Canada) expand into a broader group of more than a dozen leading global education destinations, a positive and welcoming environment is essential if the UK is to remain a leader. The UK is home to some of the world’s foremost universities, but we cannot rely on reputation alone. We must continue to demonstrate the value of a UK education and ensure international students feel welcomed from the moment they consider applying. If international education is to support the UK’s growth ambitions, government must also be part of the solution, providing a stable, competitive and welcoming policy environment that gives students confidence to choose the UK.

Rose Stephenson, Director of Policy and Strategy at HEPI, commented:

Immigration is a top concern for voters in Britain, and it is important that the debate around immigration policy is informed by evidence. This report shows that international students generate very substantial benefits for the UK economy and underpin the financial sustainability of many universities. If ministers decide to further reduce international student numbers, they should be clear that there will be economic costs as well as potential political benefits. At a time when the UK is seeking stronger economic growth, those trade-offs deserve an honest and open discussion.

Maike Halterbeck, Partner at London Economics, added:

This new report provides updated evidence on the substantial economic value that international students bring to the UK economy – value that is spread widely across the country. However, it also demonstrates what the economy stands to lose if and when this major export sector starts to decline. The number of international first-year students coming to the UK has already decreased by around 54,500 (12%) since 2022/23, and is expected to continue to decline as key new policy changes – including the potential new international student fee levy – come into force. 

Notes to editors

1. Kaplan is a leading global provider of education and training with an 80-plus-year history offering university pathway programmes (Kaplan International Pathways), higher education, on-line and transnational education, test preparation, professional education and professional assessments. Kaplan works in partnership with universities in the UK, US, Ireland, Canada, Australia and New Zealand and with companies around the world. Kaplan is a subsidiary of Graham Holdings Company (NYSE: GHC) and its largest division.

2. The Higher Education Policy Institute was founded in 2002 to influence the higher education debate with evidence. HEPI is UK-wide, independent and non-partisan. HEPI is funded by organisations and higher education institutions that wish to support vibrant policy discussions, as well as through events. HEPI is a company limited by guarantee and a registered charity.

3. London Economics is one of the UK’s leading specialist economics and policy consultancies. With a dedicated division of professional economists specialised in education and labour markets, we have unparalleled experience across the higher education sector. As a result of our independence and the quality of the analysis we undertake, we are considered sector experts and often deliver economic insight to key policy makers and stakeholders. For more information, visit londoneconomics.co.uk.