International students are good for us, actually

The segregationists are going to tank the economy along with the education system

Last week I shared some thoughts about the Trump administration’s attack on Harvard’s ability to enroll international students. The gist: the average college wouldn’t survive such a blow, and I also agree with the point I’ve seen on socials: this would force institutions to curtail spending, to shrink what they offer and to whom they offer it. Sounds like a win-win for an administration hell-bent on segregating America.

In related news, the government announced Thursday that embassies would pause all interviews for student visas, while they sort out a process to supposedly vet applicants’ social media. And last night, the State Department capitulated with a press release announcing plans to “aggressively revoke visas for Chinese students.”

I know I am not the first to point out that the US runs a surplus when it comes to the number of students who choose to come here to study versus the number of American students who choose to go abroad for their own studies. With China alone, this surplus is enormous. According to the Institute of International Education, over 277,000 Chinese students are studying in the US (which is down by nearly 100K compared to pre-pandemic levels), while around 11,000 American students attend college in China.

Likewise, the US runs a trade surplus in education services exports, both in terms of dollars and in number of transactions. Education services include intellectual property and/or services (education services are not goods with a physical form, nor are they financial instruments). And despite some reporting I’ve seen to the contrary, it is my understanding that international students in the US (and their tuition dollars) are not factored into the calculation of education service transactions. In other words, the US has a trade surplus on education services even without counting our equally outsized share of the international student market.

I think one reason we have such a trade surplus is owed to the fact that US-based education service providers have the benefit of associating themselves with American educational institutions and the sector’s overall reputation. While every US-based service provider will at least benefit indirectly from the reputation, some institutions are themselves service providers in foreign markets, while other private service providers are able to directly associate themselves with US institutions in aid of securing new clients abroad (ie, touting their relationships with American institutions as a marketing strategy).

There are both short and long-term bonuses to the internationalization of American higher education. One, it’s a boon to campuses and their surrounding communities; The National Association of International Educators (NAFSA) estimated that international college students contributed nearly $44 billion to the US economy and supported more than 378,000 jobs last school year.

Another important thread to watch here is the issue of OPT, or Optional Practical Training. This component of a common student visa program (F-1) allows students to engage in internships or experiential learning before or immediately following graduation. The US benefits enormously from the OPT program, yet the first Trump administration proposed eliminating it.

At that time, the Business Roundtable estimated effects of Trump’s proposed OPT policies were negative across the economy including on Real GDP, job creation, wages, and entrepreneurship indicators.

Source: Business Roundtable, 2018

According the IIE, international student enrollment has been steadily increasing since the shock of the COVID-19 pandemic. Uncertainty in this market, and outright anti-Chinese sentiment, are bound to reverse these promising trends.

Finally, it’s not just schools or the economy that will suffer from yet another massively humiliating self-own. We’re also talking about upheaval for students who have made plans and sacrifices, not to mention the domestic students who benefit from having international students next to them in class. Over a third of the international students in the US are graduate students, the rest of boarding school students in private K-12 institutions or undergraduates on college campuses (most high school and college students enter the US on the same type of student visa). I would be interested to hear how these different institutional constituencies are engaging with federal policymakers, especially the lesser-discussed K-12 private/boarding school segment.