Why Do Students Choose The Uk Economics Essay

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Why do studentschoose the UK? The UK has long been well known for its good reputation. Many students choose the UK for their further career.The major factors are academic excellence, value for money, language of business.The increasing of the UK higher education market in past years has not only benefited home students, but has also created more opportunities for students from overseas. In reference to recent research from the British Council, the UK ranked in second place on the largest global market in higher education(HE) industry whereas the USA came first. The quality of the UK education and opportunity after educated such as higher salaries in job with a UK qualification are found to be the main attraction for overseass students choosing to study in this country. Moreover, according to the Higher Education Statistics Agency (HESA) in the year 2007 and 2008, overseas students made up to12.7% of the HE* population in the UK. Therefore,These students are an important focus of the UK HE market, and this is set to continue in the up-coming future.



All international students that live in the UK also participate in the gross domestic product (GDP) of the country. In fact, after the graduation some students who decide to remain in the UK, also contribute to the income tax. Each overseas student attending a UK university provides on average nearly £16,000 per year to the UK , approximated by the British Council, and forecast that if the UK can attract more than 800,000 overseas student, as a result mentioned earlier, over £13 billion will be added to the UK's economy by the year 2020.

Effects on economy:

As far as tution fees are concerned,around £1.5 billion in tuition fees was paid by non-EU students in the year 2004-05. However, in the case of EU, official data is not available, but it is possible to estimate that the amount of tuition fees paid by EU undergraduate and postgraduate students were £80 million and £100 million respectively, a total of £180 million.

Around £1.68 billion is the sum of the figures for EU and non EU students payment in total. By separating the total of £1.68 billion between EU and non-EU students, income into the economy arising from tuition fees paid by EU students were

£150 million, and by non-EU students £1.3 billion which is a huge amount of money.


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In addition, the benefits contributed by the overseas students are not financial alone as well as bring in skills, and multi-cultural diversity to the UK. To help with lack of skills shortages in the UK, the government in the 2003 had established a new entitlement for foreign students of science, technology, engineering and math to work inside the UK for the period of12 months after graduating from the UK institution. Furthermore,The Scottish Executive has also recently declared extension of Visa for international students in order for them to stay longer up to two years period after graduation, due to the declination of scottish people and to attract talent from overseas.

Other impacts

With the growing demands and limited places from both home and overseas students, these have strongly led to a rise in competition for places in some institutions and any additional positions would need government funding. In reference to the research shown from the HE, Internationalism in Higher Education, related to EducationGuardian.co.uk,it has shown the effects of the expansion of overseas students which is determined by subject choices, with business studies being the most favourite at the expense of humanities and some sciences. On the other hand, according to the HE research on projected requires for HE places ,the increase in students from different countries could help to meet student number targets, particularly in shortage areas such as science, mathematic, and engineering . This is attributed to the disproportionality of high number of applicants for these subjects with strong qualifications.

The impact of recent international graduates on the economy

In every year, over a thousand international students choose to stay in the UK to work following graduation from a UK HEI*. This clearly has a huge impact on the UK economy, assumption can be made that the majority of these individuals would not have moved to the UK, if in fact they had not studied here, and hence this affect can be viewed as a direct result of the UK treating them as overseas students. However, students remaining in the UK and entering the labour market following graduation are likely to have the same impact as new immigrants. The impact is double-edge sword: first, they pay tax and consume welfare benefits as the fiscal impact; and second, their economic activity contributes to the nation's GDP here called the economic impact.

*HEI= higher education institution


A Home Office report concluded about the immigrants' characteristics and how the demand for public services can be impacted. Unsurprisingly, a significant amount of money more than their consumption of benefits can be created by those who were still young, uncommitted and highly educated .Although, no single estimation had been made, there was also an observervation of the fiscal effects over a range of levels of usuage of Government spending.

By assuming that £20,000 is an approximate starting amount salaries of graduates, roughly calculation can give out the amount that the Government is likely to earn from income taxes and national insurance and make prediction about the remaining income's proportion that will be received by the government in other form of taxation (such as VAT , insurance,etc) of different length of stay.

In 2004 and 2005 over 6,500 EU students lived in the UK after graduation from UK HEIs to seek employment. However, the number of overseas students who still remain in the UK after the graduation are not available ,as non-EU student who wish to settle down in the UK have to pass strict immigration controls, there is a high tendency that a lower proportion of non-EU students will remain than Euporean students.

therefore, those who do so stay in the UK for an average of five years upon the graduation will gain half the value of the tax revenue they pay in the form of Government provided goods and services,

net fiscal will be gained of over £200 million (£100 million each for EU

and non-EU students).

In spite, fiscal benefits, there is a large impact on the economy from spending on tuition fees and other living costs. However. amount of this spending is not taxable. One of the reason that universities intend to spend the majority of their income on staffs salaries is the proportionality of income received from overseas students will be received by Government in the form of income tax.

Labour market effects

As far as the labour market is concerned, the graduated labour is determined by whether or not there is currently a shortage or an excess of the effect of increased supply of a product and services. Looking at the UK graduate job market as a whole, there is currently a low level of unemployment, the presence of recently graduated overseas students is unlikely seem to be dangerous to the employment prospects of the graduated from the UK and to their salary levels.

The reason that the UK labour market are not likely to have a significant effect by the international student is because of their presence is almost certainly contributed to thhe net economic growth

By using the assumpion number of employer, starting salaries and wage increases and the average length of stay of the graduated is five years as mentioned previously, during each year the graduated from EU countries alone will earn a total of almost £700 million in pre-tax wages where as non-EU students will earn the same in total of £1,4 billion.

Moreover, taking that the UK workers are not detrimented by those student in anyway

for example the conditions of employment's salaries, level of employment's level, and the levels of consumption of the residence of the UK will not be effected by their stay, their stay would result in the net increase in GDP as well as in the level of consumption and hence there is a real growth of economic throughout the economy . However,By summing all the number of the total spending of european students to GDP to over one billion pound and two billion pound from international student in total.

Increasing global competition

Even though,the UK tends to be one of the top attractive destination for international student,Nowsaday global competition is growing up fast accoring to to british council,singapore, Malaysia,thailand and India are the countries which are all growing their international education. Interms of european countries, france, netherlands and germany are also proviiding postgraduate programmes in english as well as their own languages. Research from Leeds university for the econiomic and social research council revealed that Germany and France are taking science students from poland for under and post graduate as well as from eastern bloc countries. The Britain is warned that it can be miss out unless it adpots better policies in order to attract talents from other EU countires.


Overseas students have played an important role in the UK economic sector, and their contribution to the UK is expected to continue to grow over the coming years. In addition to overseas students coming to study in the UK, UK universities have also been connecting partnerships with overseas institutions to deliver their courses. The British Council estimated that international education is currently worth up to £11 billion directly and a further £12billion indirectly to the UK economy each year. This is therefore a market the UK cannot afford to miss out on.


1.UK Economy at Risk, Warns British Council, The British Council press release, 20 April 200









10. www.ukcisa.org.uk






2.Impact on Uk ,effect on economy

3.other impact, impact of graduated on the uK

4.Fiscal impact

5.Labour market effect, increasing global competition