British universities after Brexit

It’s her favourite topic: Europe. Helen Drake is a professor for French and European Studies at Loughborough University. For years, she has researched European politics, European integration and European history. This, the Brit fears, could become much more difficult, should the UK go ahead with its plan to exit the European Union. “European studies will lose a lot of their attraction”, the professor said when I interviewed her earlier this week. “My students are already less interested in Europe than in other topics.”

She believes that this is down to the ambivalence that has characterised the relationship between the UK and the EU for decades. For her, the vote for Brexit could also have personal consequences – Drake holds a chair for European Integration that is financed by the European Commission. “I have no idea whether I will be able to keep it beyond the initial funding period”, she stated.

These days, academic staff and students think along similar lines. They all worry about the future of the British university system, should the UK leave the EU, as requested by its people. Students and staff with European passports are equally worried. They fear that the cost of studying in the UK will go up and that European funding will no longer be available to British researchers.

Up until now, the vote for Brexit hasn’t had too many practical implications, neither for Europeans nor for Brits (except the pound/stock market crash). “There is no immediate change to the UK’s participation in the Erasmus+ programme following the EU referendum result”, the website of the British Erasmus office states. “All participants and beneficiaries should continue with their Erasmus+ funded activities and preparation for the published application deadlines in 2016 and 2017.” Every year, there are tens of thousands Europeans that come to the UK with the help of this program.

Many now fear that this could change within a couple of years. “It is understandable that there are fears among the 125.000 EU-students and the 43.000 staff from EU-countries”, Julia Goodfellow, the president of Universities UK, the association of British universities, commented recently.

It all depends on the negotiations between Brussels and London, once Article 50 is officially triggered. In the run up to this, the universities are only one of many parties that lobby the government. “The universities have to work hard to influence the government in order for them to keep the status quo”, said Charlie Beckett, one of my former professors at the London School of Economics and Political Science (LSE). For him, it is very difficult to forecast the impacts of a British divorce from the EU, at least at this point in time. “It does not change the fundamentals but many of the details”, he said.

One core area of concern is the freedom of movement. This could hit the universities hard: Europeans make up five percent of the student body, among the University staff, it’s 15 percent. “The end of the European freedom of movement could lead to many European students no longer coming here”, explained Julie Smith, a lecturer at the University of Cambridge and a Member of the House of Lords.

This is also what Ulrike Franke believes, a PhD student at the University of Oxford. “Not only with regard to the legal status, but also with regard to tuition fees, there is a lot of uncertainty”, the 28-year old German said when I phoned her. So far, Europeans pay the same amount of fee as British students, up to 9000 pounds per year. It is quite possible that they would have to come up with substantially more than that, should the UK treat them like overseas students.

With fees of around 35.000 pounds per year, a degree in the UK would become much more expensive. “In this case, many Europeans will consider going to the US instead”, Franke stated, “the UK would lose the cost competitiveness that has drawn a lot of Europeans here.” Two weeks after the historic vote for Brexit, she is still desperate. “I am heartbroken”, she said.

After the British exit from the EU, life for scientists and researchers could also become harder. “Because about the uncertainty around tuition costs, future job opportunities and the legal status, many professors and students will give it a second thought”, said Marc Szepan, another PhD candidate in Oxford.

Deans have started thinking about how to compensate for the loss of European funding after Brexit. Given that the UK is running a substantial budget deficit, they don’t assume that the government will be able to foot the bill. “The government simply cannot afford this”, Julie Smith from the University of Cambridge believes.

According to data from Universities UK, British universities received 836 million pounds during the 2014/2015 academic year, a similar amount came from the central government in Westminster and the NHS. Thus, the public sector would have to double its spending once the UK turns its back on the EU. The majority of income though, around 33.2 billion pounds, is provided by tuition fees.

Already now, a short time since the referendum on June 23rd, British scientists are receiving unofficial warnings to not apply for European funding after 2018. “Even if we were theoretically still eligible for European funding, we should not underestimate the subjectivity factor”, Helen Drake said. By that, she means that even in case the UK continued to qualify for European grants and funding, researchers or students might not be selected, because of anti-British feelings. So far, more than 60 percent of the research partners of British Universities come from other EU-countries, Universities UK has found out.

Interestingly enough, some German scientists are more optimistic than that. Theoretically, it could be the case that the UK is cut off from European projects such as Horizon 2020 (budget: 80 billion Euro), should it press on with its exit from the EU. However, “I don’t believe the EU will really do this”, said Markus Rudolf, dean of the German business school WHU. “It would reduce its own attractiveness if British universities were no longer part of the European network.” Contrary to this, LSE-professor Beckett believes that British universities will increasingly have to search for funding outside of the EU. “We are already seeing that funding agreements are being postponed or even cancelled”, he said.

Britain’s move to exit the EU will not only impact European students in the UK. “Also for British students, this will be dramatic”, said Ulrike Franke, the German PhD student in Oxford. “Even before the referendum, they spent less time abroad compared to other EU nationals.” Helen Drake has made similar observations. “The number of British pupils and students learning a foreign language has gone down continuously”, the professor stated. “This trend will be amplified in this current climate of euro-scepticism.”

Immigration & the EU-Referendum

Immigration, it has turned out, is one of the hottest topics in the run-up to the referendum. With Prime Minister Cameron having promised a reduction of net-migration to under 100.000 per year, the reality looks a bit different. According to new statistics from the Office of National Statistics, net-migration into the UK stood at 333.000 in 2015, the second highest on record. Out of those 333.000, 184.000 Europeans came to live and work in the UK, under the freedom of labour movement.

For Brexiteers, this is just what they have been waiting for. Both Boris Johnson and Michael Gove, two of the leading voices of the Leave-campaign, have called for a reduction in European net-migration into the UK and for the introduction of an Australia-style points system. This, they argue, would help the UK make sure that only high-skilled, high-earning foreign workers would enter the country.

Economists however are not impressed. “Under the current system, the UK is mostly attracting the right kind of immigrants from the EU already”, a report by Berenberg Bank in London finds. An Australia-style system would create extra administrative costs and would rely on government or some other central agency to identify supply gaps in the labour market and then allocate foreign workers accordingly in a more effective way than the current market based system. “It makes little sense to risk introducing a government failure where a market failure doesn’t exist”, the analysts conclude.

Still, Johnson and Gove pretend to have a case in point. And yes, on a superficial level, you could argue that large amounts of European workers end up in low paid, low skilled jobs in Britain. According to a recent study by the Migration Observatory at the University of Oxford, a majority of Europeans currently working in the UK would not meet Tier 2 visa criteria, were they obliged to apply for a work permit in order for them to work here in the UK. A Tier 2 visa requires, among other criteria, a university degree and an annual salary of at least 20.000 pounds.

But, this does not come as a surprise, as large parts of the British food manufacturing, fruit picking, plumbing and building industry are desperate for workers, independent of where they come from. Eastern Europeans come here because there is plenty of work for them and wages are higher than in their home countries. They also come because British companies cannot find enough Brits who want to work as plumbers, fruit pickers, waitresses or builders.

Still, Vote Leave argues, Poles, Bulgarians and other EU-nationals should not be allowed to come here for work. The argument is similar to what you hear in Germany when discussing the asparagus industry: These people are taking away our jobs, our future, our prosperity.

A pretty one-sided argument, both with regard to the UK economy as well as the German economy. So what do firms do if they cannot find domestic workers for their jobs? Not only the builders, but also food processing firms, the hotel industry and even tech firms fret about the possibility that they would soon be restricted in hiring EU-nationals instead of Brits. Obviously, this cannot be good for their business.

As Taavet Hinrikus, the co-founder of TransferWise, one of the fastest growing London fintech firms, put it, a Brexit would be “a complete disaster for the tech scene”. According to him, tighter labour laws could lead to TransferWise opening an office in Germany, maybe in Berlin. “If the movement of people gets restricted, we would need to make changes”, Hinrikus said. Not only professional changes, but also personal changes: “I don’t know whether I would still want to live here.”

Like me, Hinrikus is a foreigner. He comes from Estonia but has lived in the UK for many years. Limitations to European immigration after a Brexit would not just make things harder for TransferWise here in London where a third of their 100 employees come from other EU-countries. It would also create an additional emotional barrier between Brits and other Europeans, a feeling that I share.

As do many other fellow Europeans here in the UK: 40 percent of EU-nationals working in the UK say the referendum has negatively affected the opinion of the country, a recent study by Totaljobs has found. 87 percent of Europeans living in the UK are worried about the potential impact of Brexit. Still, 76 percent hope to stay even if Brexit becomes a reality. “Maybe even the Brits will leave”, Hinrikus joked when I spoke to him on Tuesday, “who wants to work in a UK that suffers a huge economic crisis?”

The anti-immigration attitude here in the UK strikes me as odd, given that the UK prides itself on having had one of the biggest empires in the world, with citizens in the remotest places on earth. Many of those people came to live in the UK after the liberalisation of the colonies, a welcome stream of immigration. Since 1991, EU migrants have accounted for just over a quarter of total net migration into the UK and thus, for only a small portion of the growth in the UK population, the Migration Observatory has found.

Of course, Vote Leave-campaigners still have one argument in reserve. Because of European immigration into the UK, public services and housing have come under severe strain, they claim. Both for schools as for flats, the economists at Berenberg flatly reject this argument. EU migrants make a net-contribution to the UK budget, the study finds, thus enabling more, not less funding for public services.

The same goes for the housing market: “The UK housing market suffers mainly from a lack of supply than excess demand”, they conclude, “less than 10 percent of Britain is urbanised, it does not lack space.” Comparing the country to Germany where you have thousands of little towns dotted around the countryside instead of one big centre like London, I definitely agree. “Better land and planning laws to make the supply side of the market more responsibe to changing demand conditions are badly needed”, the report reads.

So let’s see what June 23rd brings. I hope I won’t have to apply for a visa any time soon.