DistantNews
Support us
🇳🇬 Nigeria /Economy & Trade

Trump student visa rule could cost US $400bn annually - Report

From The Punch · () English

Summarized and contextualized by DistantNews.

At a glance

News Documents & data New plan
  • A new Trump administration rule limiting international students' stay in the U.S. could cost the economy up to $400 billion annually, according to a report.
  • The rule replaces the "duration of status" policy with a fixed stay of up to four years, requiring extensions for continued study or work.
  • The report warns this could reduce highly skilled STEM graduates entering the U.S. workforce, impacting innovation and entrepreneurship.

A new immigration rule from the Trump administration could significantly harm the U.S. economy, costing up to $400 billion in annual output and weakening the nation's capacity for innovation and entrepreneurship. The rule, set to take effect in September, replaces the long-standing "duration of status" policy for international students with a fixed stay of up to four years. Students wishing to extend their studies or remain for post-graduation work will now need to apply for an extension.

US-trained foreign STEM graduates patent inventions at four times the rate of typical college graduates and establish high-growth startups at six times the rate of US-born graduates.

— Peterson Institute for International Economics reportHighlighting the significant contributions of foreign STEM graduates to U.S. innovation.

The policy grants U.S. authorities greater discretion over extensions for the Optional Practical Training program, which allows graduates to work in fields related to their studies. The Peterson Institute for International Economics (PIIE) report highlights concerns that this change could substantially decrease the number of highly skilled international graduates entering the U.S. workforce, particularly in science, technology, engineering, and mathematics (STEM) fields. These graduates are noted for their significant contributions to innovation and economic growth.

PIIE estimates that if the US experiences a sustained one-third decline in annual international student enrolment, the economy could lose between $200 billion and $400 billion in output each year, equivalent to roughly 0.7% to 1.3% of GDP.

— Peterson Institute for International Economics reportQuantifying the potential economic impact of reduced international student enrollment.

The PIIE report estimates that a sustained one-third decline in international student enrollment could lead to annual economic losses between $200 billion and $400 billion, equivalent to 0.7% to 1.3% of the U.S. GDP. The report also underscores the importance of international education as a major export industry for the United States, accounting for about 5% of U.S. services exports. Discouraging international students could reduce export earnings and slow down innovation, entrepreneurship, and long-term productivity growth, potentially impacting the country's global competitiveness.

The report also points out that higher education is an export industry for the United States, accounting for about 5% of US services exports.

— Peterson Institute for International Economics reportIllustrating the economic value of international education to the U.S.
DistantNews Editorial

Originally published by The Punch. Summarized and contextualized by our editorial team with added local perspective. Read our editorial standards.

More Stories

From Our Blog