After a battle over immigration policies and international student visas, fewer new international students chose to study on U.S. college campuses this fall, which comes at a significant economic cost.

In the fall 2025 semester, the tally of new international students studying in the U.S. sank 17%, according to a fall snapshot from the U.S. Department of State and the Institute of International Education released earlier this month.

Altogether, international students at U.S. colleges and universities contributed nearly $55 billion to the U.S. economy over the 2024-25 academic year, including tuition revenue as well as student spending, according to the IIE’s Open Doors report.

This year’s sharp enrolment decline — largely due to the Trump administration’s changes to the student visa policy — is projected to cost the economy $1.1 billion, according to a separate analysis from NAFSA: Association of International Educators.

A separate analysis by Implan, an economic software and analysis company, found that when accounting for the direct loss of student spending as well as the ripple effects across the economy, the drop in enrolment amounts to a nearly $1 billion loss to gross domestic product.

“International students do far more than attend classes — they sustain local economies,” said Bjorn Markeson, an economist at Implan. “Their spending supports thousands of jobs, stimulates local businesses, and generates tax revenue that underpins community services.”

Before the Trump administration put a temporary pause on new visa applications in the spring, there were nearly 1.2 million international undergraduate and graduate students in the U.S., mostly from India and China, making up about 6% of the total U.S. higher education population, according to the Open Doors report.

A declining pipeline

The U.S. has been the top host of international students, but the enrolment pipeline was already under pressure. Fewer new students from abroad also enrolled for the fall 2024 semester, notching the first decline since 2020-2021, during the Covid pandemic, according to the Open Doors data.

More restrictive student visa policies in the U.S. and changing attitudes abroad about studying here were factors contributing to that decline, other research shows.

“A close read of enrolment figures from last year and this fall shows that the pipeline of global talent in the United States is in a precarious position,” Fanta Aw, NAFSA’s executive director and CEO, said in a statement.

“The ripple effects of these policy changes are being felt across campuses and communities around the world,” Aw said.

The impact on U.S. colleges

While the decline in international enrolment has broader economic effects, colleges and universities and the students they serve are the hardest hit.

addition to the value of international student perspectives, foreign students typically pay full tuition, which makes international enrolment an important source of revenue for colleges and universities, according to Open Doors’ survey of more than 825 institutions.

With fewer new students and tuition dollars coming in, there are fewer resources for faculty, programs, and financial aid for U.S. students.

Those funds support colleges’ ability to provide financial assistance, Ted Mitchell, president of the American Council on Education, previously told CNBC.

“Full-paying international students pay scholarships for domestic students — it’s a 1-to-1 relationship,” Mitchell said. (CNBC)