Business Forward Report: ‘Trump Slump’ in Higher Ed, $40 Billion Services Export at Risk

Enrollment is down at many colleges and universities because foreigners feel less safe and welcome in U.S.

WASHINGTON, D.C. — As colleges and universities begin fall classes, there will be fewer foreign students on many campuses, according to the findings of a Business Forward Foundation report released today. The report, “The ‘Trump Slump’ In Higher Ed,” outlines how growing intolerance is reducing foreign enrollment and hurting America’s colleges and universities, college towns, and students.

This is the second in a series of Business Forward reports on the “Trump Slump” in the U.S. economy. Download the first report, “The ’Trump Slump’ in Tourism,” here.

“This is a real problem for the American economy,” explained Business Forward President Jim Doyle. “It might seem like fewer foreign students means more opportunity for local kids, but U.S. college enrollment is down. Colleges will cut back if they can’t fill those seats, which means local students will have to pay more.”

For U.S. citizens attending public universities, the impact could be devastating. At public universities, foreign students pay two to three times more tuition than in-state students. This additional income offsets declining U.S. enrollment and repeated cuts in state funding.

Science, Technology, Engineering, and Math (STEM) programs are likely to suffer the most. More than half of graduate engineering students (80 percent in electrical engineering) are foreign. Without these students, U.S. companies will not meet American companies’ demand for STEM talent.

States that supported Trump in the 2016 election are hardest hit. Foreign students are asking recruiters if their school is in a “red” or a “blue” state.

“[I] was turned away by prospective students who would ask whether Tennessee was a red or blue state,” said Charles Wilkerson of Tennessee Technological University. “I’d say, ‘Well, we’re a red state,’ and they would literally walk to the next table.”

The impact of this “Trump Slump” at colleges goes beyond the schools themselves. Higher education is a $40 billion services export for the U.S., supporting about 450,000 jobs.

“I’m mind-boggled…Higher education is a place where we have a major trade surplus with the world,” explained Dick Startz, Professor of Economics at the University of California, Santa Barbara. “Doing something to hurt that is obviously going to make our trade balance worse.”

The study includes a case study on Ohio, where foreign students contribute $1.2 billion to the state’s economy. Their tuition and other spending while in the U.S. support nearly 15,000 Ohio jobs. At Wright State in Dayton, a 22 percent drop in foreign enrollment (from 1,889 to 1,475) led the school to cut language and music programs and its swim team.

To read more about the “Trump Slump” in U.S. higher education, download Business Forward’s full report here.

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