Does Canada Benefit From Its Foreign Student Programme?


We are providing this information because Canada’s Immigration Minister Jason Kenney recently announced that he would be expanding Canada’s foreign student programme.

Before he proceeds down this path, he, his department, and the entire government would do well to look at other countries’ evaluations of their foreign student programmes.

For the benefit of Mr. Kenney and others who are acting as guardians of Canada’s public purse in this time of large deficit budgets, we have summarized below the work of Harvard Professor of Economics George Borjas. He evaluated the U.S. foreign student program in 2002. He concluded that the foreign student program does not generate the profits claimed by advocates. One of his key findings is that even though foreign students pay higher tuition fees than domestic students , the actual costs of foreign student tuition are higher than what they are paying. In other words , American taxpayers are actually subsidizing foreign students.

For Mr. Kenney and the rest of the gov’t, the key question in the current recession should be this : If Canadians are subsidizing the costs of foreign students, what sense does it make to continue the programme in its present form, or, worse still, to expand it?

In Mr. Borjas’ words, the foreign student programme “yet again shows the many ways in which our immigration policy has failed to serve the national interest”.

Before Mr. Kenney goes any further, he should conduct a review of the evidence and come up with a sensible answer to this question : DOES CANADA BENEFIT FROM ITS FOREIGN STUDENT PROGRAMME?

According to Mr. Kenney’s Department, “More than 130,000 students come to study in Canada every year and even more come to Canada to learn English or French.”

These figures indicate that Canada’s foreign student intake is, per capita, much higher than that in the U.S. and that the effects of the programme (such as the true costs, the displacement of Canadian students, the corrupt dealings of visa schools, etc.) are probably much greater than those in the U.S.

Look at the following link to see the numbers of foreign students Canada has accepted from 2004 to 2008. The 2008 number is around 80,000 with especially high numbers in Ontario, B.C. and Quebec.




(1) The number of student visas issued to foreigners by the U.S. has grown dramatically in the past few decades. In 1971, the State Department issued only 65,000 student visas. In 2000, it issued 315,000 visas.

(2) After the September 11, attacks (and the discovery that one of the terrorists had entered the U.S. on a student visa and that 2 others were waiting for official approval of their student visas to attend flight school), Senator Diane Feinstein (D-CA) quickly proposed a 6-month moratorium on student visas. U.S. universities lobbied intensely, fearing that they would lose an important source of cheap labour and tuition revenues. Shortly after, Senator Feinstein withdrew her proposal.

(3) “The program is so large, so riddled with corruption and so ineptly run that the INS (Immigration and Naturalization Service) simply does not know how many foreign students are in the country or where they are enrolled. ” There is no tracking of foreign students once they enter the U.S. It has insufficient checks and balances but many loopholes which allow it to be abused by people who have little interest in pursuing education. (The INS is now called the U.S. Citizenship and Immigration Services—the USCIS. )

(4) No one has asked the basic question : Does The U.S. benefit from its foreign student program?

(5) As of 2002, a foreigner had to meet 3 criteria to obtain a student visa: (A) Be accepted by an Immigration and Naturalization Service (INS)-approved program and enroll full-time at that institution ; (B) Have sufficient funds for self-support ; (C) Maintain a residence abroad and have no intention of giving it up.

(6) Many promoters of the foreign student program have turned the student visa program into an alternate immigration program. Foreigners have very few options for migrating legally to the U.S. unless they have relatives already in the U.S. One of the few is the “Diversity Lottery” which allows 50,000 people to obtain permanent residence per year.

(7) The widespread notion that the best and brightest foreign visa students stay in the U.S. is not true. Over half who get green cards (permission to stay) get them because they marry an American citizen or permanent resident. Another 10% stay because of family connections. In other words, close to two-thirds of Permanent Resident visas that are given to students have nothing to do with the so-called students’ “exceptional skills”.

(8) In 2002, the INS had a list of 73,000 U.S. schools which it had certified to accept foreign students. To most people, this number will sound hard to believe because the whole country has only 4000 colleges and universities, another 6000 state-accredited vocational schools and 24,000 secondary schools. However, the INS list includes thousands of elementary schools and a large number of other “educational institutions”. For example, in San Diego County, the INS granted approval to two legitimate universities, but also to almost 400 other institutions such as the College of English Language, Avance Beauty College, the Asian American Acupuncture University, and the San Diego Golf Academy. Almost any institution seems to get approved. This makes the foreign student visa program vulnerable to anyone who has the financial resources to “buy” a visa. The U.S. has delegated its responsibility of “selecting the immigrant flow to thousands of privately-run entities whose incentives may not coincide with the national interest”.

(9) The foreign student program provides an almost limitless supply of low salary lab and teaching assistants to universities. Many of these educational institutions “sell visas”, that is, offer visas to foreign students to enter the U.S. Many lobbying organizations such as the IEF Education Foundation promote the profit motive when they make comments like the following in their advertising to universities : “Many of you are interested in recruiting students from China. We share your interest in this lucrative market.”

(10) There is evidence that the foreign student program has corrupted the admission and educational process at some schools in the U.S. For example, a San Diego businessman received between $200,000 to $300,000 to procure student visas for Middle Eastern students. This scheme “included an admissions officer who accepted bribes to admit the foreign students as well as professors at three different colleges who sold passing grades to the students”.

(11) Many foreign countries have a thriving consulting firms industry. In China, the demand for visas is so strong that “according to a U.S. consular official in Beijing, a fee of $10,000 buys phony letters of recommendation, false evidence of economic support, and even professional actors or actresses to stand in during the interview with consular officials”. In India, a consulting agency will guarantee a pathway to a visa for $800. In Korea, one firm warned potential student clients against dealing with competitors by stating that competitors’ visas had been obtained illegally “through bribery of workers at the American Embassy in Seoul”. “…an amazingly large number of institutions …benefit financially from the presence of foreign students and …foreign consultants…brazenly misuse, distort, and pervert the system. Almost surely, this corrupt outcome has little to do with whatever noble goals motivate the program’s supporters.

(12) Does the U.S. benefit? Here are some conclusions. First, “The net gain generated by the labor market contribution of the foreign students who remain in the U.S. is quite modest.” Second, foreign students are like illegal Mexicans. “Both groups enter the country, substantially increase the number of workers, lower wages in their respective occupations, and increase the profits and economic resources of the companies that hire them.” Third, universities are much better off.

(13) However, Borjas discovered that the cost of providing an education to foreign students actually was higher than the tuition paid by foreign students. “Gordon Winston, Director of the Williams College Project on the Economics of Higher Education…estimates that the average per student subsidy…is $6400 in private universities and $9200 in public universities, with the subsidy being substantially higher at the most elite institutions. To give an example, out-of-state residents are charged an additional $10,704 in tuition at UCLA and $14,708 at the University of Michigan. However, Winston estimates that the (real) per-student cost could be as much as $24,740 at these high-ranked institutions, so that even the high out-of-state tuition paid by foreigners could not possibly cover the cost of education.

(14) Re a final answer to the question : Does the U.S. benefit ? The net gain from the employment of foreign students and foreign graduates may be around $1 Billion, but the subsidy accruing to foreign students is more than twice as high. There are two lessons to be learned: (A) The foreign student program…”is best viewed as yet another re-distribution program, taking wealth away from native workers and redistributing it to universities and foreigners. Second, the calculation suggests that it is far from clear that the program pays its way.”

(15) With regard to non-measurable impacts of foreign students, most promoters of the foreign student program say it serves U.S. foreign policy objectives. They tell us platitudes like “foreign students are exposed to the institutions and culture of the U.S.” ; “foreign students cement alliances with other countries” ; “they also transfer knowledge and skills to other countries, particularly developing countries” ; “they create diversity”, etc. Needless to say, there is little evidence to support these claims, and it is prudent to be skeptical, particularly because the education industry is the one making the claims. If these claims were true, then other well-off countries such as France and Germany would probably be imitating the U.S. foreign student program, but they are not.

(16) Claims that the program allows the U.S. to skim the best talent available in the world are not true. “It is not even clear that it would be desirable for the U.S. to skim the best and brightest from abroad. Such a drain of human capital would further widen the income gap between the U.S. and the rest of the world”, create many other negative effects and increase “global inequality”.

(17) Another negative in the foreign student program is that the influx of foreign students into areas such as the bio-sciences has probably altered the educational plans of generations of native-born Americans. The notion that “Americans are not interested in scientific careers—and that is why we must keep importing foreign students—is plain nonsense. What Americans are not interested in is in pursuing a career where they have to compete with workers who originate in very poor countries and are willing and able to work for very low wages in the United States.” An additional negative is that “Undergraduates often charge that the lack of English language proficiency among many foreign teaching assistants obstructs their understanding of the material.” Defenders of the foreign student program protest that the program brings “hard-to-measure” impacts. However, we have to remember that “Hard-to-measure impacts often come in two flavors; some are beneficial for the United States and some are not.”

(18) “The terrorist attacks of September 11 increased our awareness that immigration policy—including the foreign student program—has national security consequences.” The fact that neither the State Department nor the INS knows the location or number of foreign students in the U.S. led to the development of a computerized system which will better track the 1 million foreign students believed to be in the country.”

(19) But another very important national security concern about the foreign student program is that the U.S. is educating large numbers of foreign students who come from unfriendly countries and then return to those countries with the knowledge they have gathered at American institutions. “The U.S. has traditionally banned the export of goods that it considers vital to its national security…. Yet there is no similar ban on the type of knowledge that can be acquired in American universities and exported abroad.” For example, students from countries like Iran have obtained American doctorates in such areas as nuclear and organic chemistry, chemical and nuclear engineering, and atomic and nuclear physics. Lobbyists in American universities have already signalled that they will obstruct federal efforts to review applications of foreign students who want to study in these areas. Borjas asks : “Can there be a better example of misplaced priorities in the higher education sector?” “Inevitably, the United States will have to confront the question of whether to prevent foreign students belonging to particular nation origin groups from entering particular types of educational programs.”

(20) “Perhaps the most important lesson provided by removing the mist and myth that surrounds the foreign student program is that it yet again shows the many ways in which our immigration policy has failed to serve the national interest. “


Look at the following link to see the numbers of foreign students Canada has accepted from 2004 to 2008. The 2008 number is around 80,000 with especially high numbers in Ontario, B.C. and Quebec.