Over the past 20 years, the UK has witnessed a steady rise in the number of students attending university, reaching over 2 million full-time students in the 2020/21 academic year, according to the latest data from the Higher Education Statistics Agency (HESA), a 72% rise since 2000/01. 

A key component of this growth has been the UK’s ability to attract an increasing number of international students. Overseas students now account for just over a quarter of all full-time students, compared with 14% in the 2000/01 academic year, according to HESA’s data. The rise of international students is even more apparent when looking at first-year students, who now account for around a third of all full-time students. 

Underlining the importance of international students to the UK, in March 2019 the International Education Strategy (IES) was unveiled by the UK Government. This included the ambition to increase the number of international students studying in the country to over 600,000 a year by 2030 — A goal that was reached in the 2020/21 academic year.

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Diverging trend in international applications post-Brexit

While the latest HESA population statistics show the number of international students studying in the UK continuing to rise, this only goes up to the 2020/21 academic year. Looking at applications data from UCAS, which cover the 2021/22 and 2022/23 academic years, show that there has been a significant drop in new applications from European Union (EU) students.

As shown in figure 2, since the 2020/21 application cycle there has been a significant fall in the number of EU students applying to study in the UK. By the 2022 cycle, the number of EU applicants had fallen to c.23,000, just under half their level in the 2020 cycle. 

These drops in numbers align with Brexit and the ending of the “home fee status” for EU students. This means they not only lose access to the same tuition fees and financial support as UK students, but they also face stricter visa and immigration programs.

However, Britain’s decision to leave the EU appears to have had no impact on its attractiveness to non-EU students. In contrast to the falls seen for the EU, the number of other international students applying has continued to grow, rising by 25% between 2020 and 2022, which equates to an additional c.22,000 students and offset the majority of the decrease in EU applications.

The slight fall in total international applications since 2020 indicates that the Government’s 600,000 international student target is likely to be missed in 2021/22 and 2022/23 population statistics. 

Strong demand remains for PBSA

International students are more likely than domestic students to live in PBSA and their growing numbers have supported the PBSA sector, which has grown to over 760,000 beds across the UK – an increase of 66% over the past decade. 

With this in mind, it might be expected that a halving of EU applications to the UK would feed through to a major impact in the PBSA sector. However, there are reasons to why this is unlikely to be as impactful as initially thought.

As has already been outlined, the fall in EU applicants has mostly been made up for by increased applications from outside of the continent. Particularly from countries like China, India, and the USA, which have contributed to a rise in applications by 28%, 11% and 6% respectively. Furthermore, these students are significantly more likely to live in PBSA than European students, as shown in Figure 3, suggesting that as their growth offsets the fall in EU students, PBSA demand will rise. 

Finally, all of this is happening alongside a strong rising in domestic students, which is putting pressure on the existing PBSA supply and the university’s ability to house their students. Many cities, including Bristol, Manchester, Glasgow, and Leeds, have had well-publicised struggles to house students in their cities. Some institutions are housing students in nearby cities, so they have to commute while others are paying students to defer, or paying local students to live at home rather than moving into halls.

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Outlook

There is no escaping the fact that the UK leaving the EU has resulted in a fall in student mobility from the continent. However, the UK remains a global destination of choice for international students, as applications from China, USA, India, and others continued to grow.

Looking ahead, we expect the number of international students to continue to rise, driven by the Government’s focus on attracting students from across the globe as part of their push for ‘Global Britain’ and the renewed commitment to IES and 600,000 international students. However, their composition will be different, with fewer from the EU.

This will continue to underpin demand for PBSA, especially as the composition of international students continues to shift towards countries with a higher propensity to live in PBSA.