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Business Policy & Markets

US Universities Are Losing Talented International Students

Restrictions on student and work visas are directing international applicants to universities in other countries. Shulamit Kahn and Megan MacGarvie, associate professors in Markets, Public Policy & Law, discuss the economic impact of restrictive immigration policies.

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Restrictions on student and work visas are directing international applicants to universities in other countries. Shulamit Kahn and Megan MacGarvie, associate professors in Markets, Public Policy & Law, discuss the economic impact of restrictive immigration policies.

The coming change of government in the US raises the potential for shifts in policy in several areas, including immigration. However, if Democrats don’t win both of the currently undecided Georgia Senate seats, President-elect Biden will face opposition from the Senate on most of his priorities. Senators of both parties need to realize that many of Trump’s immigration policy changes have been counter-productive for high-skilled labor markets by not allowing STEM students of foreign origin to remain in this country after graduation, or by preventing them from coming in the first place.

International students make up a large share of science and engineering PhDs awarded by US universities. In mathematics, computer science, and engineering, international students make up 56 percent of the PhDs granted by universities in the United States.  PhDs in these fields are in high demand and short supply in this country, as witnessed by the fact that graduates working in these fields earn 25 percent more than those in other STEM fields. Despite these high salaries, few domestic students enter these programs, so high-tech firms are reliant on a supply of bright graduates from other countries.

Immigrants in STEM fields have been crucial to creating the technological and scientific advances essential for economic progress and life-saving innovation. One case in point:  nearly half the executive committee of Cambridge, MA’s Moderna Therapeutics, a leader in the race for a COVID-19 vaccine, have come to the US from abroad. Elsewhere, the two founders of another vaccine leader, BioNTech, are the children of Turkish immigrants to Germany. In this and other global innovation races, we are lucky to benefit from a large available supply of talent: international students with US degrees.

However, continued technological progress may be threatened not just by Trump’s current visa policies, but also by policies long pre-dating Trump. True: Trump banned new temporary H-1B visas that have been used to hire highly educated workers through the year’s end, and has just recently put forward a new USCIS rule that would complicate and constrain future H-1B petitions once the ban runs out. These changes to immigration policy have the potential to damage the US economy for years to come, perhaps irreparably.  Research shows that limits on H-1B visas are causing US firms to move high-value jobs overseas. They must be reversed if the US hopes to remain a leader in science and innovation.

However, these are just the latest in a string of immigration policies that turn away bright, motivated innovators from the US economy.  Since 2005, long queues for permanent residency – particularly due to per-country limits on the number of visas made available each year – have discouraged certain scientists from remaining in the United States after they receive US degrees. Our research shows that long waits for permanent residency due to per-country limits are leading greater numbers of Chinese and Indian STEM doctoral recipients to leave the United States after completing their STEM PhD studies.

Visa difficulties seem to be encouraging foreign students to choose universities in their home country or in another, more welcoming country. In recent years, international student applications to Canadian universities have spiked sharply, while they have fallen in some US programs. Facing precarious and uncertain futures in the US due to these visa policies, foreigners completing US STEM degrees are choosing to conduct their research outside the US, whether in industry or academia.

As a result, US universities are losing ground. While US universities are still widely recognized as excellent, other countries are rapidly catching up. For instance, in international rankings of Computer Science and Engineering departments, US universities hold only half of the top 10 positions; ten years ago they held 90% of them. Chinese and Indian policies are actively growing their scientific base, with initiatives like the Thousand Talents program, the Ramanujan Fellowship and other incentives to encourage the return of expats with advanced STEM degrees.

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However, none of the prior restrictions on international students have been as dramatic as those introduced (and then rescinded) this summer or those recently introduced.  International students who thought they were coming to the US have scrambled to find another place to study. The US will lose valuable human capital, which will mean fewer highly trained scientists and engineers available to be hired by American high-tech companies in the very fields that are so in demand.

Some might argue that a reduction in the supply of international students will benefit US students, by causing firms to boost salaries in STEM fields, which will attract more domestic students to study science. Think again. Any positive effect that higher wages could have on the supply of domestic scientists would take many years to appear. And in the meantime, multinationals are shifting R&D employment to countries like Canada, more favorable to immigration by highly skilled scientists and engineers. If these jobs move offshore in response to current immigration policies, they may never come back.

The loss of international students will also harm domestic students in the short run. Research has shown that the higher tuition rates paid by international students at some universities subsidize domestic students’ tuition and actually increase enrollment by domestic students. Rather than making America great, these are policies that will weaken America by crippling our scientific know-how and innovation.  President-elect Biden knows this, and his platform included increased numbers of employment-based visas, including getting rid of the 7% per-country limit.

If the US wants to remain at the cutting edge of science and technology, there is no time to lose. Restrictions on student and work visas are directing international applicants to universities in other countries. High-tech firms and the public at large must unite with universities to pressure Congress not just to reverse Trump’s restrictions, but to reform policies such as the per-country limits on permanent residency visas in order to continue to attract the world’s best and brightest to US universities and firms.

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