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A cap on the number of international students at the five comprehensive Randstad universities will have a significantly negative impact on the Dutch economy. The gross domestic product (GDP) is expected to decline by approximately 4 to 5 billion euros. Regions, businesses, and society as a whole will feel the substantial economic consequences.

The Randstad region, which accounts for half of the Dutch GDP—the economic value of the country—will be hit hardest: 82% of the loss will occur here. The most affected sectors are business services (39%), financial institutions (20%), and the public sector (10%). These findings come from recent research conducted by SEO Economic Research, commissioned by Leiden University, Utrecht University, Erasmus University Rotterdam, the University of Amsterdam, and Vrije Universiteit Amsterdam.

The SEO study highlights the need for a balanced internationalization policy, as demonstrated earlier this year by the Dutch universities in their joint self-regulation proposal. They urge political parties to incorporate these findings into the development of a National Talent Strategy, in which international students are essential for both the regions and the Randstad.

International students strengthen the earning capacity of the Netherlands

International students are of great value to the Dutch economy, according to SEO Economic Research. Graduates help reduce labor shortages in sectors with high demand for highly educated professionals, including business services, finance, and public sectors such as healthcare, government, and education.

The duration that graduates stay in the Netherlands and contribute to the economy has increased in recent years. The retention rate of international students one year after graduation rose from 40% (cohort 2017–2018) to 57% (cohort 2022–2023). After five years, 25% still live in the Netherlands, of whom 80% have paid employment. Regions outside the Randstad also benefit through direct employment and supporting sectors.

Short-term savings, long-term economic damage

The cap imposed by the outgoing cabinet on international students at the comprehensive Randstad universities results in a net annual saving of 80 to 132 million euros on a total national budget of approximately 488 billion euros. This relatively small saving—comprising education funding, student finance, and social provisions (735 to 825 million euros) minus lost tax and premium revenues (603 to 745 million euros)—comes at the cost of broader economic damage. The impact on the labor market, business climate, and GDP translates into a decline of 3.9 to 4.8 billion euros per year.

Business climate under pressure due to loss of international talent

The economic damage from fewer international students at the comprehensive Randstad universities affects not only the state budget and labor market but also the business climate.

Previous research shows that reduced availability of international talent will further strain the Dutch business climate. 30% of companies employing many foreign knowledge workers are considering relocating growth plans or activities abroad if they cannot attract sufficient talent. This increases the risk of losing investments, jobs, and innovation capacity in the Netherlands.

Negative effects for Dutch students

In addition to the economic impact, researchers also point to negative side effects of restricting internationalization policy on the quality of education for Dutch students. With fewer international students and English-taught programs, part of the international classroom disappears—where students gain international perspectives, language skills, and intercultural competencies that prepare them for an increasingly global and diverse labor market and society.

About the Report

The report "Out of Balance Without Internationalization?" was conducted by SEO Economic Research on behalf of the comprehensive Randstad universities: Leiden University, Utrecht University, Erasmus University Rotterdam, University of Amsterdam, and Vrije Universiteit Amsterdam. SEO conducts independent applied economic research commissioned by government and industry.

The report provides an objective, quantitative analysis of the economic impact of the "Internationalization in Balance Act" (Wet Internationalisering in Balans—WIB), specifically through the restriction of international student numbers at the five comprehensive Randstad universities. It models various scenarios and shows the effects for the Netherlands of even a significant cap on international talent in the Randstad. The report underscores the need for a balanced internationalization policy.