UK Visa Issues: Staying in the Country After an MBA

Experts predicted in 2012 that the UK's stricter post-study visa requirements would discourage international students from applying to British schools. Three years later, have those predictions come true?

When the British Home Office announced plans to change its post-study work visa policies in 2012, politicians and experts worried that the new regulations would discourage foreign students from applying to schools in the UK, wrecking business schools' numbers, decimating enrollment, and driving skilled workers out of the country the day after graduation.

Three years after those regulations went into effect, those predictions have come true--to some extent. For many business schools, enrollment certainly dipped in the year following the changed regulations, with 2013 numbers dropping to an eight-year low, 21 percent lower than at the height of enrollment in 2010, according to Global MBA data from the Financial Times.

"The 2012 visa changes (along with the associated impression that the UK was no longer welcoming to international students) undoubtedly had a significant impact with recruitments from overseas down. This was especially true with applications from India," says Adam Bolton, marketing and communications director at Association of MBAs (AMBA), an international group that studies and monitors business programs.

The numbers for foreign MBA students staying in the UK have also dropped. Forty-five percent of foreign MBAs who graduated in the UK in 2011 stayed in the country to work, but only one-third are still there, according to Financial Times data from early 2015. That compares with one-half of foreign MBA students who remained in the US after studying there, and two-thirds of foreign MBA students who studied in Canada. Critics attribute the UK's lower retention rate to the country's changed visa requirements.

But there's another side to the story, one that suggests that the new regulations haven't driven students away as predicted. For one thing, the number of international students enrolling in MBA programs has leveled out: between 2014 and 2015, international enrollment only went down for four of the 12 top UK business schools listed in the Financial Times annual rankings. For two other schools, enrollment stayed the same, and for the rest enrollment rose, with Imperial College Business School seeing the highest increase, 12 percent.

The number of visas granted is on the rise too. According to UK governmental statistics from 2015, the UK saw 10,648 more Tier 2 visas granted in the year ending in March 2015, an increase of 13 percent over last year.

And school officials at some of the UK's top schools say their programs haven't seen a drop in enrollment, for one simple reason: students who are qualified to stay and work in the UK typically find a way to do so.

A UK entry visa stampIs it harder to obtain a visa now?

The new visa regulations introduced in April 2012 had some effect on student visas. They increased English language requirements for incoming students as well as tightened requirements for students to demonstrate that they could support themselves while studying in the UK.

But the most significant change affected graduates, not students. Prior to April 2012, students could stay in the UK to work for two years after graduation. But the new regulations required students to switch over to the Tier 2 visa scheme, which requires students to secure an offer of a skilled job from a licensed employer to stay in the UK.

In other words, students who want to stay in the UK after graduation need to line up a job before they receive their diploma.

Canada, on the other hand, offers a visa to students that allows them to stay and work for three years post-graduation, even without sponsorship from a company lined up. The US offers an Optional Post-Training visa, which allows students to stay for up to one year after graduation to work in a field related to their degree.

In the UK, the April 2012 change also introduced a new visa category. The Tier 1 graduate entrepreneur visa allows students with a “genuine and credible business idea” to stay in the UK for up to one year. Students applying for this visa must be endorsed by UK Trade and Investment—a government agency—or by an authorized UK institution of higher education.

However, the number of Tier 1 entrepreneurship visas issued has dropped recently, with 2,980 fewer applicants in 2015 than in 2014. The UK government attributes this drop to a stricter oversight of granting these visas, which started in 2014 after the government realized that some students were submitting bogus business plans so they could obtain visas to stay in the UK.

Has the visa change kept MBA students out?

In 2012, officials said the new regulations were a gamble for a country whose higher education industry relies heavily on foreign students, with 1,400 students from 100 countries accounting for 90 percent of all MBA students enrolling in the UK in 2014.

But these days, school officials paint a different picture than their erstwhile predictions and current statistics, saying that students who are truly qualified to work in the United Kingdom will find a way to stay.

Helen Foley, visa compliance manager for degree programs at London Business School, says that more than 50 percent of LBS' non-EU MBA students stay to work in the UK after graduation, a number she attributes to the school's connections in the finance and consulting industries that help jobs for students.

"We do not believe nationality should be a barrier to this [job-seeking process],” Foley says in an email.

Foley said the introduction of the Tier 1 graduate entrepreneur visa has also been a welcome boon for LBS' students, and that since the visa was introduced, the school has successfully endorsed 47 students to stay and start businesses in the UK.

“These have ranged from innovative home products, to creative mobile applications, to high-level finance consultancy services, to educational gaming apps for children,” Foley says.

Derek Walker, director of careers at Oxford University's Saïd Business School, says fewer foreign Oxford students are staying in the UK. Last year, 45 out of the 136 students who reported location data stayed in the UK, and he suspects that number would have been 50 percent ten years ago.

But Walker says it's a common misconception that students are heading home because of the visa requirement change. Instead, he attributes the shift to changing mores in companies. Over the past five to ten years, British companies have moved away from hiring foreign students who want to work in the UK for a few years, then move home. Instead, they prefer to hire locals who are already experienced with the UK's business and cultural climate, and who plan to spend the bulk of their career living and working the UK.

"There's a misalignment between MBA students who want to work for two or three years and then go home, and the companies, who want [candidates who will do] exactly the opposite [stay in the UK for a long time]," Walker says.

He says it's specious to blame the falling number of foreign students who stay in the UK on changed visa requirements.

"If they want to hire you, they'll get you a visa. It's not about percentages. It's about making yourself a dream prospective employee," Walker says.

"Schools and students need to think about that and about the requirements of the marketplace, rather than the rules. It's a bit like blaming the referee for a team's inability to score a goal."

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