Building Sustainable Futures: Rethinking International Student Recruitment in the UK

This HEPI blog was kindly authored by Vincenzo Raimo, an International Higher Education Consultant and Visiting Fellow at the University of Reading, and Janet Ilieva, Founder and Director of Education Insight.

Many UK higher education institutions are facing a financial crisis.  University leaders point to a decline in international student enrolments as a key cause. However, this explanation oversimplifies the issue and shifts responsibility away from institutional decision-making. The current financial predicament is not purely the result of fewer international students, but also the outcome of overly optimistic expectations for continued growth in international enrolments, driven by a temporary post-COVID boom.

The post-COVID Era International Student Boom

In the 2022/23 academic year, UK universities saw a remarkable increase in new international student enrolments: 459,170 new entrants compared to 273,340 in 2018/19. This was despite a reduction in students from EU countries of 56% over this period. Most of this growth is attributed to the demand for one year’s master’s degrees, as students sought short-term, cost-effective options. Whereas first degree enrolments dipped from a peak of 109,730 in 2020/21 to 94,105 the following year, recovering slightly to 103,845 in 2022/23.

Source: HESA Student Record

Several external factors contributed to this sharp rise, many of which were beyond UK institutions’ direct control. Competitor nations, such as the United States and Australia, were slow to reopen their borders to international students. As a result, the UK became a more attractive option for students who were keen to commence or continue their studies without delay. This environment, combined with the reintroduction of the Graduate Route visa, which allows international students to stay in the UK for up to two years after graduation to seek employment, further boosted demand.

Short-Sighted Adjustments to Growth Projections

Despite the unprecedented nature of this boom, many UK universities adjusted their future targets based on these inflated figures rather than viewing the surge as a temporary anomaly. Historically, international student enrolments have grown steadily but incrementally. Not many pre-COVID institutional five-year plan could have reasonably forecasted a doubling of non-EU student numbers. Yet, after COVID, some universities did precisely that—revised their targets and reset their financial expectations to account for continued rapid growth. In some extreme examples, universities grew their intake of new international students between 2018/19 and 2022/23 by more than 200%, and in one example below, by more than 500%, or 5,775 more new international students welcomed in 2022/23 than in 2018/19.

Source: HESA Student Record

While this growth for some universities reflects a success story, its sustainability in the medium term is questionable. In growing so quickly, have these institutions set themselves up for future disappointment? Rather than banking the windfall of increased enrolments and bolstering their reserves, many have come to rely on unsustainable levels of international enrolments. For many institutions, the financial pressure from stagnant domestic tuition fees and inflationary costs made this an enticing prospect. The income from international students—who pay significantly higher tuition fees than domestic students—was seen as a much-needed solution to close the gap left by government funding cuts and the real-term reduction in UK student fees.

However, the decision to shift base-level expectations and target continued growth was, in hindsight, overly optimistic. It also ignored the reality that international student demand would eventually plateau once competitor nations reopened their borders and global mobility returned to normal.

A Slower Growth Trajectory, or a Decline

Reports of falling international enrolments have left many universities scrambling to explain the financial gap they now face, compounded by a decline in the value of home student tuition income, down by over a third since their introduction in 2012.

In the years prior to the pandemic, international enrolments grew consistently, albeit at a slower rate. The return to a pre-COVID growth trajectory should have been expected. The past three years, with their extraordinary growth figures, were an outlier, not the new baseline for international student demand.

What is not quite clear at present, is whether we are witnessing a market correction—a return to more sustainable growth rates after a period of unprecedented expansion; or, an emergence of a new trend, where a growing proportion of students are staying in their home region. Given Canada’s restrictions on new international students and similar measures expected to impact Australia early next year, the global demand for UK higher education should have rapidly expanded. However, from January to June 2024, the number of main applicants granted a student visa decreased by 23 per cent (the number of applicants was 82,367) compared to the same period last year.

The reasons for this reduction in international student demand are complex and vary from country to country. While some were impacted by deteriorating economic conditions and currency depreciations (Nigeria, Pakistan, and Sri Lanka, among others), others, like China, are impacted by underperforming labour markets, where graduates are taking longer to join the workforce. Weaker economies, regional conflicts, and growing instability appear to be shaping the direction of travel of international students. But one thing is clear: fewer international students are choosing to study in the UK.

Winners and Losers in the International Student Race

As always in the global higher education marketplace, there will be winners and losers. While some UK universities have seen significant reductions in international enrolments this year, others have continued to grow, attracting students from key markets such as China and India. Institutions that invested in long-term international strategies, forged strong overseas partnerships, and built robust support networks for international students are better positioned to weather this correction.

Conversely, universities that became over-reliant on international student income without diversifying their revenue streams or focusing on quantity over quality are facing greater financial challenges. These institutions now find themselves grappling with the repercussions of their short-term planning and unrealistic expectations.

The Path Forward: A More Sustainable Approach to International Recruitment

UK universities must recalibrate their international recruitment strategies, embracing a more sustainable approach that acknowledges shifting global dynamics. Weaker economic performance worldwide and reduced disposable incomes are pushing students to stay closer to home, favouring intraregional mobility. In some cases, the financial sustainability challenges of UK higher education institutions, amplified by overseas media coverage, may also deter students, who now view the UK as a high-risk destination, fearing potential university closures.

Beyond immediate recruitment efforts, higher education institutions must invest in long-term, sustainable models that are not solely profit-driven. This includes forming partnerships and expanding Transnational Education (TNE) programmes that offer students greater flexibility in choosing how and where they study. By aligning short-term recruitment goals with a long-term internationalisation agenda, UK universities can build resilient frameworks that prioritise collaboration and student choice, thereby avoiding the perception of being extractive industries.

The narrative surrounding international students must change. The preoccupation with their economic contributions should be balanced by an appreciation of the broader societal impact they bring – not only during their time of study but also as future ambassadors of global cooperation.

The future of UK higher education hinges on its ability to balance short-term financial pressures with the pursuit of long-term, sustainable global engagement strategies.