Recently, in order to fight labor shortages, the UK's Home Office eased the laws to obtain a Skilled Worker Visa. International students can now switch to this visa before completing their course as long as they have a suitable job offer. However, this is turning out to be a problem for British universities, who are seeing higher international dropout rates and the accompanying loss of funds from tuition fees.
Many international students are dropping out to join the healthcare and care sectors
Earlier in 2022, the British Home Office had relaxed the rules for obtaining a Skilled Worker Visa. As reported by The Financial Times and The Economist, two big factors have created existing labor shortages in the UK: Brexit and the exodus of EU workers, and the pandemic. In October, 75% of the UK businesses were experiencing shortages, reports Bloomberg. This shortage is, in turn, making inflation and the cost-of-living crisis worse, says Eshe Nelson in the New York Times.
Post-pandemic times are making major economies reform their immigration rules to attract foreign workers again. Canada, Ireland, Australia and Singapore have all eased or expanded their immigrant laws this year. In order not to fall behind, the UK has done the same. It created new visas to attract and retain global talent, and it's easing some of the pathways to obtaining these visas.
One recent strategy is allowing international students to switch directly to a Skilled Work Visa before graduating. They don't need a degree as long as they are judged by their employer to have sufficient skills or enough previous qualifications/experience to do the job successfully. They need to have been offered a job from a UK employer approved by the Home Office, receive a certificate of sponsorship from that employer and be paid a minimum going rate.
This minimum going rate is generally about £10.10 per hour or £25,600 per year, but it is often higher for healthcare jobs. It's in the £30,000-80,000 bracket for experienced doctors, for instance. Of course, a doctor needs a first degree, but they now doesn't need to complete any postgraduate specialization they might have initially come to the UK for in order to take up a General Practitioner job.
Indeed, the PIE News reports that the sectors benefiting the most from the recent relaxing of work visa rules are healthcare and adult social care. Their analysis of immigration, education and workforce statistics shows a remarkable concurrence between spikes in Skilled Worker Visas granted in the healthcare/care sectors and university intakes (both January and September intakes). The third quarter of 2022, which coincides with the September university intake, saw a 179% increase in Skilled Worker Visas granted in healthcare and adult social care. The number of visas granted skyrocketed from 7,711 in the same quarter of 2019 to 21,543 in 2021.
Universities are being financially affected by rising international drop-out rates
While this trend is good news for the broader British economy, it's less great for universities. Indeed, British universities financially depend a lot on international fees, which can be more than twice as high as domestic fees, easily £20,000-30,000 per year. According to the Times Higher Education, when borders around the world were closed in 2021, the UK's higher education sector lost over £2 billion from what international students could have brought if everything was normal.
A few university representatives interviewed by The PIE News said that, while they cannot legally stop students from dropping out to join the workforce, they are now focusing on discouraging international students from doing that. They try to convince these students of the value of their degree during interviews and inform them of the university's compliance policies. They also “keep an eye on the early indicators'' of disengagement, such as absenteeism.
However, for many students, the high cost of tuition and maintenance fees does make dropping out to work the best solution sometimes. Some might have paid for the first year of tuition only as a stepping stone to enter the UK to work, while others find that unexpected job offers provide greater security than continuing their degree. As reported by the Guardian, in October 2022, there was an outstanding 10.7% of vacancies in the country's adult care sector. The entry requirements are usually lower in adult care than in healthcare, which makes it easier for students to take up these jobs.
Despite this drop-out problem, international enrolment in UK universities are overall recovering well after the pandemic. It's even doing better than before the pandemic. As the ICEF Monitor reports, January-September 2022 saw a 77% increase in the number of student visas granted as compared to the same period in 2019. This spike is being driven by Indian, Chinese and Nigerian students.
