Declining US College Applications: Should the American Economy be Worried?

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Could the anti-immigrant and anti-Muslim rhetoric during the American Presidential campaign, along with more recent efforts to stop the entry of immigrants from several Middle-Eastern countries negatively impact student recruitment by US colleges and ultimately US economic growth? Recent survey results from the American Association of Collegiate Registrars and Admissions Officers (AACRAO) would appear to partially support this assertion, with research finding that some 40% of US colleges reported a drop in international applications as compared to previous years. Graduate schools and medical colleges were harder hit, with nearly 50% reporting a drop in applications. The largest drop was amongst applicants from the Middle East. Although multiple factors could be responsible for the decline, many schools have heard concerns from prospective students that the anti-immigrant and anti-Muslim climate in the US has resulted in decreased interest and willingness to study in the US. Hospitals that recruit foreign-trained doctors are in a similar situation, and are unsure how they will be able to fill positions given that there are not enough graduates from American medical schools to fill the hospital residency slots. In the same way, international students (and doctors) who are already in the US have expressed concerns over their ability to complete their degree or training.

The implications are many. Schools, for instance, are concerned given the lost revenue stream that foreign students bring with them in tuition, along with their broader economic contribution. Over the short run, US schools will likely be more hesitant in extending offers to some international students (namely those targeted in Trump Administration’s immigration ban), meaning faculty researchers will find it harder to recruit students and fill positions in their research groups, and schools and researchers may be forced to take lesser quality students who they know will be able to get into the US. Over both the short- and long-term, students (and their instructors) will no longer have the opportunity to learn from and work with individuals that have different ideas and represent different constituencies. We know that diversity strengthens innovation and productivity – and ultimately economic growth – through the exchange of new ideas and different perspectives. There is, for example, a strong correlation between immigration, innovation, and patent activity in the US (Akcigit et al. 2017). As such, the loss of foreign students and their human capital will have a negative impact on the American economy and economic growth (see also my earlier post “The Benefits and Cost of Immigration and Immigrants”). Likewise, sending countries will not be able to see the benefits of having their youth trained in America, decreasing their own opportunities for economic growth.

Of course, we must wait until applicants become students to see the final impact of US immigration restrictions. But, other countries will likely benefit from the restrictions as students search for education opportunities outside of the US. Canadian colleges and universities, for example, have seen an increase in the number of applications from foreign students. Perhaps surprisingly, the increase in the number of applications is not just from countries that have been impacted by the Trump Administration’s travel bans, but also from American citizens themselves – individuals that also fear the anti-immigrant and anti-diversity rhetoric.  Coincidence? Maybe, but the growth in foreign applications in Canada and elsewhere reflect greater marketing efforts and a growing recognition that there are education opportunities outside of the US. Moreover, the growth in foreign applications is part of a longer term trend in terms of the shifting of international students away from the US and toward schools in Canada, Europe, and elsewhere. The latest shifts in the reception of international students in the US may accelerate the shift away from American schools, with longer run negative implications for the American economy.

Further Reading:

AACRAO, Trending Topics Survey: International Applicants for Fall 2017- Institutional & Applicant Perceptions, 13 March 2017. Available at: http://www.aacrao.org/docs/default-source/TrendTopic/Immigration/intl-survey-results-released.pdf?sfvrsn=0

Aria Bendix. A Pause in International Students? The Atlantic, 13 March 2017.

Ufuk Akcigit, John Grigsby, Tom Nicholas. 2017. Immigration and the Rise of American Ingenuity. NBER Working Paper No. 23137.

Stephanie Saul, “In a Survey, 40% of Colleges Report a Drop in Foreign Applicants”, The New York Times, 16 March 2017, p. A12. Available at: https://www.nytimes.com/2017/03/16/us/international-students-us-colleges-trump.html?smprod=nytcore-iphone&smid=nytcore-iphone-share

 

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