Declining Onshore International Student Numbers in UK Universities

UK higher education institutions have long relied on international students studying on campus—often referred to as onshore recruitment—for significant revenue and diversity. However, recent data reveals a sharp downturn. According to the Higher Education Statistics Agency (HESA), the total number of international students enrolled at UK universities in the 2024/25 academic year dropped to 685,565, marking a 6% decline from the previous year and the second consecutive annual fall. This figure includes both EU and non-EU students, with non-EU enrolments— the primary revenue driver—falling by 5% to around 622,000. Postgraduate taught programmes, particularly master's degrees, bore the brunt, with a 10% plunge, largely due to fewer students from key markets like India and Nigeria.

Factors driving this decline include stringent visa policies introduced in 2024, such as the ban on dependants for most postgraduate taught students, higher English language requirements, and the upcoming international student levy set at £925 per student from 2028/29. These measures aim to curb net migration but have deterred applicants amid rising living costs and global competition from destinations like Australia, Germany, and Canada, which offer more favourable post-study work options.

The impact is uneven: research-intensive universities like those in the Russell Group have seen moderated drops thanks to PhD and research master’s stability, while post-1992 institutions face steeper losses, exacerbating financial pressures amid domestic funding shortfalls.

What is Transnational Education (TNE)?

Transnational Education (TNE), also known as offshore education, refers to the delivery of UK higher education qualifications to students outside the UK through partnerships, branch campuses, franchises, or distance learning. Unlike traditional onshore recruitment where students relocate to the UK, TNE allows universities to award their degrees—such as a University of Nottingham bachelor’s—without students leaving their home country. Common models include joint degree programmes (where two institutions co-deliver), validation (UK uni oversees local provider), and full branch campuses like Heriot-Watt University Dubai.

TNE has evolved from niche online courses to a major export, encompassing undergraduate, postgraduate, and short-cycle qualifications. It aligns with host countries' workforce needs, often in fields like business, engineering, and health sciences, and supports pathways like 2+1 or 2+2 models where students complete part of their degree locally before transferring to the UK.

TNE Student Numbers Surge, Closing the Gap with Onshore

In stark contrast to onshore declines, TNE enrolments have boomed. HESA reports 669,950 students studying wholly overseas for UK qualifications in 2024/25, an 8% increase year-on-year and a 37% rise since 2020/21. Universities UK data for 2023/24 pegged the total at 653,570 across all providers, with growth flat earlier but accelerating post-pandemic via online and hybrid modes. Top destinations include China (over 200,000 students), Malaysia, UAE, and emerging markets like India and Nigeria.

By early 2026 projections, TNE students are on track to outnumber onshore internationals, with some analysts forecasting 1 million TNE learners within three years. This shift reflects deliberate strategies: nearly equal now at ~670k vs 686k, but TNE's lower regulatory hurdles position it for faster expansion.

Drivers Behind TNE Growth

The UK government's International Education Strategy 2026 explicitly pivots to TNE, targeting £40 billion in education exports by 2030 (from £32.3bn in 2022), with TNE contributing £3bn already. Initiatives include the Agent Quality Framework, Study UK campaign, and support for branch campuses via UK Export Finance.

• Host country demand: Nations like Saudi Arabia and India seek UK-quality skills without brain drain.
• Flexibility: Online TNE surged post-COVID, appealing to working professionals.
• Diversification: Unis hedge against visa volatility; e.g., University of London delivers to 190 countries.

Success stories include University of Southampton's Malaysia and India campuses, aligning with local policies for dual awards.

Why TNE Isn't a Straight Swap for Onshore Recruitment

Despite numerical parity, experts caution TNE cannot fully replace onshore international recruitment. As Wonkhe analysis notes, "International recruitment and TNE are not a straight swap." Key differences:

• Revenue models: Onshore students pay full fees (£20k-£40k/year), generating £10bn+ plus local spending; TNE involves revenue-sharing (often 20-50%), lower fees, yielding ~£3bn total.
• Student profiles: Onshore: young PGtaught from India/Nigeria; TNE: mature learners, workforce upskilling in China/UAE.
• Economic impact: No UK accommodation/tourism spend from TNE; onshore boosts GDP by £41bn annually pre-decline.
• Policy risks: Proposed levy hits articulation paths (short UK stints); 'genuine student' tests may reject if TNE alternatives exist.

TNE focuses on executive ed/public sector, not UG full-time, limiting direct substitution.

Financial and Operational Challenges in TNE

TNE promises diversification but brings hurdles. Branch campuses require £50m+ upfront (e.g., Nottingham Ningbo), with risks of losses amid geopolitical tensions. Quality parity demands robust oversight: misalignment in assessments, contact hours, or cultural expectations erodes trust.

QAA's TNE Quality Scheme addresses this via reviews of 70+ partnerships, highlighting needs for risk assessment, link tutors, and local adaptation. Security concerns arise in partnerships with state-linked providers; academic freedom applies only on UK soil.

Stakeholders like Universities UK urge levy exemptions for distance/articulation TNE to preserve progression routes to higher ed jobs.

Case Studies: TNE Successes and Lessons

University of Nottingham's Ningbo campus (China) enrols 10,000+, generating steady revenue despite initial losses, via joint ventures blending curricula. Heriot-Watt Dubai thrives on energy sector demand, exporting petroleum engineering expertise.

Challenges evident in India: Southampton's campus navigates NEP 2020 regulations but faces competition from local privates. Failures like some franchise collapses underscore due diligence needs.

Positive: 2+2 pathways boost UK transfers, though levy threatens viability.

Government Strategy and Sector Responses

The 2026 IES scraps onshore targets, prioritising 'responsible' TNE growth via ESAG and scholarships (Chevening 1,400/year). Russell Group seeks exemptions; UUK warns levy could deter articulations.

Sector pivots: 50 unis at closure risk accelerate TNE, but balanced portfolios needed.

Future Outlook: Balancing Onshore Recovery and TNE Expansion

Projections: TNE to 1m students by 2029, onshore stabilising via PhD growth and diversification (Africa, Vietnam). Solutions include agent reforms, levy tweaks, and hybrid models. For academics eyeing lecturer jobs, TNE offers global roles; students, explore scholarships.

Balanced strategy—enhance TNE quality, ease visas for high-value—ensures sustainability amid migration debates.

Photo by Vladislav Klapin on Unsplash

Implications for Stakeholders and Actionable Insights

• Universities: Invest in QA, diversify markets; link TNE to higher ed career advice.
• Students: Weigh TNE affordability vs onshore prestige; check rate my professor.
• Recruiters: Focus ethical agents, hybrid paths.

Explore university jobs in expanding TNE hubs.