International students – A good investment

Foreign students contribute more to Denmark in financial terms than they cost to complete their higher education degrees, a study has found.

The study, by a Danish think-tank on the socio-economic impact of international students, found that they contributed more than $US24 million to the economy in the 12 years to 2008, even after deducting the costs it took to educate them in Denmark.

A report of the study says that the increasing recruitment of international students had led to fears that the cost of funding public higher education would rise.

But the study authors say that as long as Danish businesses and industry hire sufficient numbers of international students after they complete their education, and they remain in Denmark for several years, the overall economic benefit will be greater than the cost of educating them.

In the 12 years to 2008, nearly 9,000 international students enrolled in Danish higher education institutions. Almost 6,000 students completed their courses while 3,000 either dropped out or were exchange students, not there to undertake a full higher education course.

Over half were masters students

Of the 6,000 who completed their courses, just over half were masters degree students who took an average of 37 months to complete the degree. Another 13% were in short-term studies of up to 23 months; 26.5% undertook medium- to long-term courses for an average of 37 months; and 6% completed a bachelor degree that took 34 months.

Foreign students included those from the neighbouring countries of Finland, Sweden, Norway and Iceland, as well as EU students and others from the rest of the world. Among those taking a masters degree, 39% were from a Nordic country, 14% from an EU country and 47% from the rest of the world. The majority taking courses of a shorter duration came from the neighbouring Nordic countries.

Almost 40% of international students were still living in Denmark one year after graduation and were participating in the Danish workforce. Those who stayed for more than a year remained, on average, for 5.5 years before leaving.

To estimate the net effect of the contribution of the students to the Danish economy, the analysis calculated how much of the productive work they did while participating in the workforce covered the expenses incurred for their education and other public services.

Measures to attract highly qualified people

As University World News reported last April, three Danish ministers proposed new plans to attract highly qualified people to the country and retain international students from outside Europe after graduation by offering them tax perks, a fast-track employment system and simplified immigration arrangements.

The Ministry of Higher Education and Science asked experts to calculate the cost-benefits of retaining foreign experts, stating that retaining 1,000 foreigners would create an additional 1,000 to 1,500 jobs.

The government then decided on a set of measures to attract and retain highly qualified foreigners. One was a fast-track arrangement for companies that wanted to employ foreign experts, while another was simplification of the current green card option for immigration, which has been further adapted to cater for highly educated people.

Most important, however, was a lowering of the taxes on salaries from the present DKK70,600 (US$10,800) a month to DKK60,600 (US$9,270) a month, with foreign experts not required to pay more than 32% of their salaries in taxes.

Highly qualified foreigners will also receive a ‘personal number’ at an earlier date. The number makes it easier for newcomers to settle in Denmark, open a bank account and obtain equal access to the Danish health system and other welfare services.

University World News reported last week that international students contributed almost US$27 billion to the US economy in 2014, a 12% increase on 2013. The growth has been driven largely by demand from students from upper-middle-income economies and countries with large national scholarship programmes.