Brexit: What are the implications for the education sector?

IES News

22 Jun 2016

Lucia BarboneLucia Barbone & Vahé Nafilyan, Research Economists

Tomorrow, the citizens of the United Kingdom are called to express their willingness to remain or to leave the European Union. The decision is crucial for both the UK and for the future of the European Union itself. Unsurprisingly, the referendum is in the news headlines, and at the centre of the political discussion.

The main focus of the discussion is immigration, which is one (and just one) dimension of the EU membership agreement. Leave campaigners often underline the negative impact of immigrants on both the demand and the supply of public services, such as the NHS or job benefits. Various figures, often from unspecified sources, have been cited from both sides, leaving the public with a sense of confusion about the true extent of the ‘immigration problem’.

There are a number of statistics released by reliable agencies, such as the Office for National Statistics (ONS), which can help to shed light on these issues. Here we first illustrate some basic facts on EU nationals in the country, in order to provide some context to the discussion, and then we examine the possible impact that Brexit could have on the UK education sector.

In June 2015, in the UK, there were a total of 30,764,000 workers, including UK and non-UK nationals: of these, the vast majority (90.32 per cent) were UK nationals. European workers were less than 6 per cent of the total employed workforce, and non-EU nationals were 3.8 per cent. Even if the figures appear small when compared to the national workforce population, the UK has one of the highest percentages of EU immigrants within the EU area, according to Eurostat data. Only Belgium, Ireland, Cyprus, Luxembourg, and Austria have higher percentages. However, various research reports have underlined that EU nationals are not attracted to the UK by the availability of free public services. Indeed, recent research by the Institute for Employment Studies for the European Foundation for the Improvement of Living and Working Conditions finds that EU citizens do not act as 'welfare-tourists', and do not decide to relocate to the UK with the intent of taking advantage of public services. This is also confirmed by another study from GLA Intelligence, which has shown that the two most popular reasons for migrating to the UK are 'formal study', and 'definite job' reasons. This suggests that individuals choose the UK as a destination to conduct their studies, or to work, after being offered a position. Since studying is the main motive for relocating to the UK, it is interesting to investigate what could happen to the education sector in the case of Brexit.

The truth is that it is not possible to predict accurately what would happen in such a scenario, considering the fact that the hypothesis is historically unique. However, reliable information on the numbers of immigrants in the Education sector can help to understand how big (or small) the problem is, and might be in the future. To do so, we consider two aspects: the professionals working in the sector, and the students. How important are EU nationals as both providers and consumers of the educational services?

The ONS classifies jobs under a number of industry categories[1], one of which is ‘Education’. This category includes all professionals for all levels of education[2]. In 2015, there were 3,248,000 workers in this industry, and the vast majority are UK nationals (92.7 per cent). EU nationals add up to around 4 per cent, and are therefore a small share of the education workforce in the country.

There were 2,266,075 higher education students in the UK during the academic year 2014/15. One in five students comes from outside of the UK, and 28.5 per cent of non-UK students are EU nationals (UKCISA data). Student inflow is significantly greater from non-EU countries, such as China, India, Nigeria, Malaysia, USA, and Singapore, which together sum up to 175,920 students, but EU-students tend to remain in education to study and they are, on average, more likely to be employed in professional jobs, as reported in a recent ISER-MiSOC research briefing.

In conclusion, the UK has one of the highest percentages of EU-national immigrants, but they do not typically act as welfare tourists. From the perspective of educational services provision, EU-citizens constitute a small share of education professionals, and so it is unlikely that Brexit can hugely impact the provision of education. However, we do not know how these workers are distributed among the different education levels. If, for instance, the majority of these EU nationals work in UK higher education institutions, the impact might be much more profound than expected.

Instead, a decision to leave the EU might affect student inflows, with a possible reduction of students from EU countries. This might cause a loss in terms of fees revenue and diversity in universities. Also, since EU students tend to remain in the UK after their studies, and work in professional occupations, companies requiring such skills might be affected. They would have a smaller pool of choices of high-skilled younger workers, and need to pay extra costs or higher salaries to hire them from the EU (such as visa and transaction costs). It is not surprising then that education professionals and companies will follow very closely the outcome of this historical referendum on Thursday.

References and Data Sources

Eurostat: http://ec.europa.eu/eurostat

GLA Intelligence (2016), Migration Indicators: November 2015, available at http://data.london.gov.uk/dataset/migration-indicators/resource/a09d453f...

Luthra, R. and Morando, G. (2016), The Best and the Brightest. EU students at UK universities and as highly skilled graduate workers in the UK, MiSoC Research Briefing, available at https://www.iser.essex.ac.uk//files/news/2016/brexit/brightest-best-graduates-eu.pdf

Marangozov, R. et al. (2015), The social dimension of intra-EU mobility: Impact on public services – A country study on immigrants from the New Member States to the United Kingdom, available at http://www.employment-studies.co.uk/system/files/resources/files/eufd0116.pdf

Office for National Statistics: https://www.ons.gov.uk/

ONS Annual Population Survey: https://discover.ukdataservice.ac.uk/series/?sn=200002

ONS Standard Industrial Classification of Economic Activities 2007 (SIC 2007): http://webarchive.nationalarchives.gov.uk/20160105160709/http://www.ons....

UKCISA, International Student Statistics: UK Higher Education: http://institutions.ukcisa.org.uk//info-for-universities-colleges--schools/policy-research--statistics/research--statistics/international-students-in-uk-he/

 


[1] Standard Industrial Classification of Economic Activities, 2007

[2] Pre-primary, primary, secondary, higher education, tertiary, cultural, driving school, educational support.

Subscribe to blog posts

 


Any views expressed are those of the author and not necessarily those of the Institute as a whole.