There is no doubt that following the scrapping of Tier 1 Post-Study visa of the UK Points Based System student numbers are down. Many UK business schools have reported enrolments down compared to this time last year. The Association of MBAs contacted its 47 member education providers in the UK and discovered shocking concerns. Over 90% of members were against scrapping the post-study route, citing fears of damage to competitiveness, reputation and finances, not only of the schools themselves, but also the wider economy.
MBA degrees are targeted primarily at mature students who already have a wealth of business experience behind them. Many are taking the next steps in advancing their careers, often spending between £30,000 and £50,000 on tuition alone. According to a recent survey by the Association of MBAs, 51% of students are self-funded, 32% receive company sponsorships, 10% use bank loans and none receive government assistance.
The message of the Coalition’s immigration policy is precisely the opposite of the slogans: the UK is to all intents and purposes “closed for business”. The UK is also loosing the talent its universities are producing: it will become much harder for graduates to use the specialised knowledge, skills and networks that they have learnt during their course in the wide UK economy.
Before the UK introduced the Points Based System and the Post-Study Visa, the majority of international students graduating in the UK immediately returned home. There were simply few opportunities available in the UK and students. What has been important for providers of business courses in the UK is that the post-study route gave students an increased perception of opportunity, making the UK a highly attractive study destination. Sadly, this perception has now been deeply dented once again.
Scrapping the post-study work route will have many unintended consequences and ultimately sends out a negative message about brand UK:
- Reduced competitiveness: UK business schools will lose out to their competitors across the world. Currently 8 UK business schools are in the Top 50 of the world, but rankings rely on attracting the brightest and the best.
- Loss of diversity: Internationalisation is a key ranking factor for universities and a reduction in international student numbers would harm UK business school rankings. Further, diversity and mixing with a broad range of cultures are pillars of the best business programmes.
- Reduced revenue: Universities face the prospect of tight spending cuts and a significant loss in revenue from lost enrolments following the scrapping of Tier 1 Post-Study Work. In 2008, 73% of all students enrolled at UK business schools were international students. That is an average of 126 international students per UK business school. A serious amount of money.
- Reduced labour force competiveness: A reduced recruitment pool of graduates in the UK will make international companies less willing to base or continue to base their operations here.
- Wider UK economy damaged: Overseas business school graduates are a major export industry and boost UK investment in the long term due to the networks and ‘good will’ generated during their time as students. The UK currently trains, influences and exports business leaders from major global financial centres. In 2008, students from outside the EU comprised of 83% of all international students enrolled at UK business schools. The top non-EU feeder countries were: India (19%), China (5%), Nigeria (5%), the United States (4%), Singapore (4%), United Arab Emirates (4%), Malaysia (3%), Russia (3%), Egypt (3%) and South Africa (3%). A total of 83 countries were reported.
The UK already faces strong competition from business schools in Europe, North America and Australia, markets which offer attractive employment opportunities to graduates. And high quality English-language MBA provision is expanding rapidly in emerging economies such as China, India and Latin America—these are the highest growth regions for accreditations by the Association of MBAs.
UK schools must compete at the highest level to attract students to its programmes and the consultation has already had a negative impact on MBA providers. While the new policies are not as bad as initially anticipated, the damage of the debate is already done. Much has been made in the foreign press, particularly in emerging markets, of the bad atmosphere for foreign students in the UK.
And while Tier 2 visas remain an option for graduates, many smaller companies such as start-up business ventures lack the resources and infrastructure to deal with the complexities of the bureaucracy surrounding that process.