Study: Int’l Students Added $14.5 Billion To Economy in ’06-’07

While foreign students at American colleges and universities are most often singled out for their scientific and cultural contributions, their growing numbers help make them an increasingly important economic force as well, according to a new report from the Institute of International Education.

In the 2006-07 school year, the report found, international students’ net contribution to the U.S. economy was nearly $14.5 billion — up a billion dollars from the previous year, the largest annual increase to date.

“These are foreign people buying an American product, and the Department of Commerce says international education is our fifth-largest service export, bigger than medical services,” said Allan E. Goodman, president of the institute, a nonprofit organization that promotes international study. “It’s a huge factor in a lot of cities, including New York, where international students contribute about $1.5 billion, more than the Yankees, the Mets, the Rangers, the Knicks, and the Giants combined.”

The number of foreign students in American institutions of higher education, from community college to graduate school, increased 3 percent over the previous school year, to 582,984, the report found. This followed three years of declines, and brought the total back to almost exactly the number of students that came to the United States for the 2001-02 year, just before the Sept. 11 attacks.

Those enrolling in the United States for the first time surged 10 percent last year, a statistic considered important because those students are likely to study in the United States for several years.

Overall, foreign students spent more than $20 billion in 2006-07, about half on tuition and fees and half on living expenses. The report estimated that $14.5 billion came from the students’ home countries, mostly from personal and family sources. According to the report, which was largely financed by the State Department and is being officially released Tuesday, fewer than a third got their primary funding from U.S. sources.

The economic contributions grew so quickly last year because of tuition increases, Goodman said, and because more foreign students were in expensive certificate programs that offer few scholarships.

The economic impact of the international students was provided by NAFSA: Association of International Educators, based on the institute’s international student data, and made part of the report, Open Doors 2007.

For several years, India and China have sent the most students here, together accounting for more than a quarter of last year’s international students. Most experts expect the numbers to continue to grow. “Next to water, the biggest shortage in the world today is probably higher education,” said Goodman, adding that only the United States could absorb the demand.

The University of Southern California and Columbia University had the most foreign students last year, with New York University in third place.