In the economically challenging higher education sector, institutions tend to cling to the few sources of profit and growth they can find.
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The impact of falling international student enrollment will not be felt evenly across the sector. The schools with the highest international students have the resources and demand to manage the drop, but some small private schools will struggle to find more revenue.
The share of international students in the U.S. had been growing for decades, but it shrank in the 2025-2026 school year, according to Fitch Ratings.
International students are particularly valuable to colleges and universities, since they usually pay full tuition, according to Fitch analyst Nancy Moore.
NAFSA, an association of international educators,
On average, that means international students are responsible for around $130 per American resident, NAFSA said — but the impact is actually concentrated in certain states, and generally in the Northeast.
The economic value of
Uneven impact
International students are most likely to attend triple-A rated universities, said Richard Ciccarone, president emeritus of Merritt Research Services, based on data of first-time undergraduate students. International students are significantly more likely to attend private schools than public schools, Ciccarone said.
For public schools rated triple-B and below, international students make up 2.2% of the student body, on average, Ciccarone said. For private schools rated triple-B and lower, international students were roughly 4% of students.
"Exposure is very uneven," Moore said. "Institutions with diversified enrollment and strong brand recognitions, like in NYU, keep their applicant pools and have a healthy balance sheet and are generally better positioned to absorb declines."
Large, highly-rated public schools tend to have fewer international students than private students, but they still have quite a few. The University of Illinois - Urbana-Champaign had more than 16,000 international students in the 2023-2024 academic year, and they made up more than
For a public university, international students are
"As an example, at my college international students make up about 9% of the undergraduate student body," Startz wrote. "But because tuition for international undergrads is more than triple the tuition for in-state students, the loss of tuition income from a major downturn in the number of international students would matter a whole lot."
The biggest concern from a drop in international students would be for schools with weaker ratings, where student tuition makes up a greater share of revenue, Moore said.
Although small, low-rated schools often don't attract many international students, for those that do, a change could have a huge impact. "Every student counts" when a school gets the bulk of its revenue from enrollment, Ciccarone said.
Low-rated schools with high international students tend to be religiously affiliated, smaller liberal arts schools, or specialty schools, like Julliard, a performing arts conservatory.
Schools with the highest percentage of international students are usually very small, Startz wrote, but they are often prestigious — like The New School or the Rhode Island School of Design — or have backing from a religious organization, which could help them stay afloat.
Shifting the math
"There was a time when a lot of schools were drawing from international to get those full pay students," Moore said, "and now they're finding that what once helped them is no longer a tool in their toolbox."
As the economics of higher education have become more fraught, schools have tried to lean into areas where there was still demand. For many schools, that was Science, technology, engineering, and mathematics subjects and graduate programs. Declining demand means those areas are no longer a safe bet.
More than half of international students study STEM subjects, NPR reported, and just 38% of international students are undergraduates, according to Startz.
This may just accelerate existing trends in the market, Moore said.
"STEM programs are still very much in demand," Moore said, but "it's becoming a saturated market."
Schools have spent years upgrading their STEM facilities, Moore said, "so those that have the shiny new labs, those are the ones that may attract those students."
Competition for international students was also increasing even before the changes to immigration policy, Moore said.
To adapt, "many institutions are expanding their recruitment into new geographies, and they are generally strengthening the domestic pipeline and investing in retention," Moore said.
Many international students have come from India and China, but universities are now beginning to expand to regions like South America and Europe, Moore said. Still, the recruitment challenges are affecting all areas, she said.
"The geopolitical tensions are everywhere. The immigration policy affects everyone," Moore said.
If the federal government reverses its stances on immigration, might international student interest rebound?
"I'm sure [universities] would love that to happen," Moore said. "Are they expecting it to happen? I think they're preparing for the worst."
The policy decisions might have a lasting impact on enrollment by "changing the momentum" of international students' demand, Ciccarone said.
"That's one of the things that I worry about," Ciccarone said. "Once you get a momentum where [students] no longer seek out U.S. universities, or you have options to go in other countries, you may make it hard for them to recover."
There are "probably programs that are available in the U.S. that are not available in other countries," Moore said. "So there is always going to be a demand. It's whether the programs match the demand at the time when international enrollment rebounds — and if it rebounds."
