International students contribute $40.1B to US economy: study

The rise in numbers to 1,057,188 international students is a clear indicator of the enduring appeal of American higher education institutions.

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The recent data from NAFSA: Association for International Educators and the Institute of International Education (IIE) showed a significant rebound in the economic contribution of international students to the US economy in the 2022-2023 academic year. 

After the setbacks induced by the pandemic, the influx of over one million international students, contributing $40.1 billion, signals not only a recovery but also underlines the crucial role these students play in the US educational and economic landscape.

The 19 percent increase from the previous year, although still slightly below the 2018-2019 peak, is noteworthy. This resurgence indicates a revitalization of the US as a preferred destination for international education following the global disruptions caused by the pandemic. The rise in numbers to 1,057,188 international students is also a clear indicator of the enduring appeal of American higher education institutions.

Vital to US economy

Secretary of State Antony Blinken’s comments illustrated the multifaceted benefits of international education, extending beyond mere economic gains. 

“International education doesn’t just benefit individuals. It’s also vital to American diplomacy, to our economic competitiveness, even to our national security,” said the US Secretary of State Antony Blinken in a recorded statement released during a live stream presentation of the Open Doors data.

This perspective aligns with the broader understanding of international students as catalysts for enriching academic and cultural diversity within U.S. campuses. They bring unique perspectives that enhance the learning experience for all students, contributing significantly to globalized education and fostering international understanding.

The economic impact of these students is substantial, not just in terms of tuition fees but also through their expenditures on housing, transportation, and consumer goods. 

“Their contributions to the U.S. economy are significant, and it is encouraging to see an annual increase for the second year in a row,” said Fanta Aw, NAFSA’s executive director and CEO.

This spending pattern bolsters local economies and supports a significant number of jobs—368,333 as per NAFSA’s estimates. The fact that three international students help sustain one U.S. job highlights their integral role in the job market.

Regional economic benefits

The geographic distribution of these students, with states like California, New York, and Texas hosting the largest numbers, points to a regional variation in the economic benefits. The significant presence in these states, along with the fact that nine states exceeded the $1 billion mark in economic contributions, underscores the substantial financial impact these students have at the state level.

Beyond the immediate financial contributions, international students offer long-term benefits that are harder to quantify but equally significant. As Eddie West, assistant dean of international strategy and programs at SDSU Global Campus noted, their role in national and local economies extends well beyond their study period. 

“Those of us in the profession of supporting international students will be quick to emphasize that their contributions go far beyond economic impact,” said Eddie West.

Many international students remain in the U.S. post-graduation, contributing through work on H-1B visas, entrepreneurship, or as permanent residents. This aspect of their contribution, though not fully captured in current data, is a vital component of their overall impact.

“It’s important to acknowledge just what a boon to national and local economies their spending can be… The NAFSA data doesn’t yet incorporate the economic impact of international students who remain in the U.S. after graduation, whether on H-1B visas, by starting companies, or after becoming permanent residents,” West stated.

A surge in Indian students

The Open Doors data also revealed interesting trends in the demographics of international students. The surge in Indian students, especially at the graduate level, contrasts with the relatively flat growth in Chinese student numbers. This shift could indicate a diversification in the countries of origin for students coming to the U.S. 

The fact that Sub-Saharan Africa showed the highest regional growth and Ghana entered the top 25 places of origin is indicative of U.S. institutions broadening their international recruitment strategies.

The increased enrollment of graduate students compared to undergraduates suggests a more focused pursuit of advanced degrees among international students. This trend could reflect a global inclination towards specialized education and the high value placed on U.S. graduate programs.

The data for the 2022-2023 academic year illustrates a strong recovery and growth in the contributions of international students to the U.S. economy. Their impact, however, transcends economic metrics, significantly influencing academic diversity, cultural exchange, and long-term economic benefits. 

This upward trend in international student enrollment not only reflects the enduring appeal of American higher education but also highlights the need for policies and practices that continue to support and enhance this vital sector.

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