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International Enrollment 'Potentially Volatile' Revenue Stream

November 21, 2016

International enrollment is an uncertain revenue stream for U.S. colleges and universities as Donald Trump prepares to take over as president of the United States, according to a report Moody’s Investors Service released last week.

Between 8 percent and 10 percent of total net tuition revenue in the United States comes from international students, the report estimated. International students only make up about 5 percent of U.S. higher education enrollment, but they pay more in tuition than domestic students.

Immigration proposals like those Trump has discussed, including proposals affecting employees with H-1B visas, could change international student demand significantly by hurting their postcollege job prospects in the U.S., Moody’s said. Universities that recently entered the international student market and those with less well-known brands globally would be most affected.

“In a climate where domestic students are extremely price sensitive and tuition increases have become a political hot topic, growth in international students provides a financial buffer against constrained tuition revenue growth,” the report said. “However, policy shifts can quickly change the landscape for international student demand, making this a potentially volatile revenue stream.”

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