International Students Contribute €15.5 Billion to Germany’s Economy, Study Reveals

Germany’s Economic Strategy: Investing in International Students Pays Off Long-Term

A recent analysis conducted by the German Economic Institute (IW) on behalf of the German Academic Exchange Service (DAAD) underscores the significant economic contribution of international students in Germany.

The study shows that the long-term revenue generated by international students far exceeds the state's investment in their education, with returns estimated at eight times the initial expenditure. IW’s findings reveal that Germany quickly recovered its investment, as the contributions of 40% of international students staying after graduation cover the cost of their education within three years, resulting in a net €15.5 billion per cohort. Even with a 30% retention rate, the surplus reaches €7.4 billion, and with 50%, it rises to €26 billion.

Prof. Dr Michael Hüther, Director of IW, emphasized that investing in international students strengthens Germany’s skilled labour force, which, in turn, drives long-term economic growth and addresses demographic challenges. He added that such investments are highly profitable for the public sector, providing substantial benefits to public budgets. Dr Joybrato Mukherjee, DAAD President, highlighted that despite universities not charging tuition fees, international students contribute far more to society over their careers than the state invests in their education, making them a valuable asset both academically and economically.

With 405,000 international students currently in Germany and 65% of them intending to stay after graduation, the country is seeing consistent growth in international student enrollment. According to the OECD, Germany, along with Canada, has the highest retention rate, with 45% of international graduates remaining in the country ten years after completing their studies. The steady growth of international students in Germany presents a win-win scenario, benefiting both the economy and society.

Editor's Note:

The economic and academic contributions of international students in Germany exemplify the transformative power of global education. The recent analysis conducted by the German Economic Institute (IW), commissioned by the German Academic Exchange Service (DAAD), highlights how these students enrich Germany’s skilled labour force and provide substantial long-term financial benefits to public budgets. Despite the absence of tuition fees, the nation reaps impressive returns from its investment in education, addressing demographic challenges and fueling sustainable growth. With Germany maintaining one of the highest retention rates for international graduates, this steady influx of global talent underscores the country’s ability to foster both academic excellence and economic prosperity.

According to Skoobuzz, through strategic investment in international students, Germany sets a precedent for the symbiotic relationship between education and economic development.