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Why does the Office for National Statistics fail to measure the UK’s educational exports?

  • 10 March 2017
  • By James Pitman, Managing Director Higher Education UK & Europe, Study Group

This guest blog has been kindly written for HEPI by James Pitman, Managing Director Higher Education UK & Europe, Study Group

Education is one of our most successful export sectors. It is our fifth largest services sector and the second biggest contributor to our net balance of payments. So why does the Office for National Statistics (ONS) fail to measure and monitor the UK’s educational exports?

The ONS’s annual International Trade in Services (ITIS) survey notes that although it ‘covers the large proportion of International Trade in Services, there are a number of notable exceptions’, one of which is higher education.

Contrast this to Australia. The Australian Bureau of Statistics (ABS) publishes its International Trade in Goods and Services report every month, and tracks total direct spending on fees and related goods and services by international students. The latest figures show that education exports contributed A$21.8bn to the Australian economy in 2016, an increase of 17% compared to 2015, based on growth of 12% in international student numbers. Their tourism sector also recognises that 10% of that sector is directly and indirectly dependent on international students through holidays and visits from friends and family.

Whilst Australia is busy implementing its National Strategy for International Education 2025 to increase international student numbers to 720,000, the UK Government seem more preoccupied with trying to deter international students from coming here – for example, through threats of further visa restrictions. Perhaps the issue is too politically charged for the ONS?

One of the most frustrating parts of the ONS’s incomplete data collection on international education is the data used to justify the Government’s crackdown on overseas students. The International Passenger Survey (IPS) suggests nearly 100,000 students overstay their visas annually. But recent reports, including an unpublished Home Office report, highlight large disparities between the IPS and other sources. The true number of overstayers could be closer to 1,500.

A review of how the ONS measures student migration has been announced, but the ONS would do well to also consider the broader question of how our education exports are measured and tracked too. We must not underestimate the importance of education as an export, and systematic evidence of its worth could help deter politically-motivated attacks on international students while highlighting the sector’s value.

In 2013, the old Department for Business, Innovation and Skills (BIS) claimed education exports were worth £17.5 billion to the UK economy. A recent report from Universities UK goes further, estimating that international students generate nearly £26 billion for the UK economy, when accounting for fees, living costs and socialising. And these figures only take into account higher education, excluding the valuable further education, English language and school sectors.

As Vince Cable noted in a recent column in the Independent, ‘For a post-industrial country still searching for an economic role, education has become a key plank of our economy.’  This value is not only economic – international students sustain the UK’s soft power abroad. HEPI’s own research in 2015 revealed that 55 serving heads of state had benefited from a UK education.

Given the benefits that international students bring to our economy, our universities, and our local communities, along with the extra soft power, the UK should be doing everything in its power to boost the sector and keep up with the competition. Competitors such as Australia and Canada are designing strategies to attract greater numbers of international students while, as a country, we debate whether or not economic value is more or less important than the need to reduce net migration to an arbitrary figure. The UK is rapidly losing market share as a result, despite this being a global market that the OECD reports as growing at 6% per annum.

There is a need for greater clarity around student migration, but also around the importance of education as one of our most important exports. Common sense says that we should be tracking this export and using the data to create international education strategies that support the sector, rather than harm it.

 

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