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Economic impact of international education in Canada – 2017 update

Global Affairs Canada - Roslyn Kunin & Associates, Inc. –December 2017

Table of contents

Executive summary

Existing literature, as well as the previous studies on the economic impacts of international education conducted by Roslyn Kunin and Associates (RKA) for Global Affairs Canada, clearly indicates that there is a significant positive value associated with international students studying in Canada. The current study updates the 2016 study (which was based on 2014 data) with more recent data, and assesses the economic impact that international students studying in Canada in 2015 and 2016 had on the Canadian economy.

We estimate that, in 2015 and 2016 respectively, international students in Canada spent around $12.8 billion and $15.5 billion on tuition, accommodation and discretionary spending. The economic impacts presented in this report focus on the combined direct and indirect impacts associated with such spending.

The results of the study are summarized below.

  • After accounting for Canadian scholarships and bursaries, the total annual expenditures of international students, including their visiting families and friends, contributed $12.8 billion and $15.5 billion to economic activities in Canada in 2015 and 2016, respectively. This translates into a $10.5 billion and $12.8 billion contribution to Canada’s GDP in 2015 and 2016, respectively.
  • GDP contributions of over $10 billion include both direct impacts and indirect impacts, where firms supplying goods and services to the education services and other sectors are also taken into account.
  • An impressive 18.0% growth in the number of long-term international students in 2016 accounts for most of the 21.2% higher spending and associated economic impact compared with 2015. Students from India, in particular those studying at the college level, contributed most to this overall increase, with Ontario accounting for the biggest increase in the number of international students.
  • Ontario, with the largest number of students, made the largest contribution to GDP with $6.3 billion (49.7% of $12.8 billion), followed by British Columbia, with 21.6% and Quebec, with 13.0%.
  • The amount of international students’ overall annual spending translates to 140,010 jobs (the equivalent of 118,640 FTE) supported by the Canadian economy in 2015. The comparable value in 2016 was 168,860 jobs (or 143,100 FTE) supported.
  • International students’ annual spending directly and indirectly contributed $2.3 billion in tax revenue in 2015. The comparable value in 2016 was $2.8 billion.
  • Because international students’ expenditures represent revenue for goods and services from overseas, they are Canadian exports of education services.
  • In 2015, the value of international education services, as measured by total spending by international students in Canada ($12.8 billion) amounted to 12.5% of Canada’s total service exports to the world, and equalled 2.4% of Canada’s total merchandise exports. This value increased in 2016, accounting for 14.5% of our total service exports, or 3.0% of our total merchandise exports.
  • The top 10 source countries accounted for $9.6 billion in international student spending in 2015, which translates to 14.5% of the total service exports, or 2.1% of Canada’s total merchandise exports to these countries.[1] In 2016, these countries accounted for $11.8 billion in international student spending, which translates to 17.2% of the total service exports, or 2.7% of Canada’s total merchandise exports to these countries.
  • In 2016, long-term international students accounted for 93.4% of the total spending by international students, they contributed $12.0 billion to Canada’s GDP and they supported 158,300 jobs.
  • Based on sensitivity analysis, we have estimated the upper and lower bands of economic impacts resulting from different levels of student spending.

A 10% increase or decrease in spending by international students results in an approximately 10-11% change in economic impacts.

Key results of the study are summarized in the following tables.

Summary table I: Number of international students and total annual spending in Canada, by province and territory, 2015 and 2016
2015
All Students
2015
Total Annual Spending ($millions)
2016
All Students
2016
Total Annual Spending($millions)
Newfoundland and Labrador2,638$58.43,227$72.6
Prince Edward Island1,715$48.62,270$68.3
Nova Scotia12,537$352.814,063$413.4
New Brunswick4,837$124.05,178$136.4
Quebec61,880$1,692.567,534$1,887.2
Ontario195,710$6,161.4233,226$7,806.8
Manitoba11,276$287.814,298$374.8
Saskatchewan6,814$181.08,063$222.6
Alberta26,063$668.930,342$823.6
British Columbia134,324$3,236.8145,691$3,726.6
Yukon25$0.660$1.4
Northwest Territories9$0.219$0.4
Nunavut0$0.00$0.0
Canada [2]457,828$12,812.9523,971$15,533.9
Summary table II: Combined direct and indirect economic impact of all international students in Canada, by province and territory, 2015 and 2016 ($million)
2015
Output
2015
GDP at basic price
2015
Labour Income
2015
Employment (jobs)
2016
Output
2016
GDP
2016
Labour Income
2016
Employment (jobs)
Newfoundland and Labrador$83.5$51.2$26.7615$102.7$62.9$33.0762
Prince Edward Island$54.7$32.9$20.1488$74.1$44.9$27.4663
Nova Scotia$437.4$267.7$158.13,685$519.1$318.2$188.54,378
New Brunswick$196.1$106.7$61.01,458$225.6$122.1$70.21,670
Quebec$2,553.1$1,463.6$897.722,173$2,920.4$1,664.9$1,019.125,102
Ontario$8,017.9$5,037.8$3,041.462,737$10,081.9$6,349.4$3,833.679,034
Manitoba$400.0$238.8$143.33,321$510.8$306.3$183.54,250
Saskatchewan$289.9$160.4$84.81,915$356.0$197.1$104.12,350
Alberta$1,361.3$772.4$446.78,280$1,663.9$945.0$545.110,094
British Columbia$3,669.9$2,391.1$1,507.435,294$4,252.9$2,764.8$1,732.340,499
Yukon$2.5$1.4$0.820$3.5$2.0$1.227
Northwest Territories$6.4$3.4$1.117$8.0$4.2$1.421
Nunavut$1.5$0.9$0.47$1.8$1.1$0.58
Canada$17,074.5$10,528.3$6,389.6140,010$20,720.8$12,783.0$7,740.0168,861
Summary table III: Comparison of total annual spending by international students with Canada’s service and merchandise exports
 2015
Value
2015
International Student Spending as % of Exports
2016
Value
2016
International Student Spending as % of Exports
Total Spending of International Students$12.8 billionn/a$15.5 billionn/a
Canada’s Export in Services$102.3 billion12.5%$107.4 billion14.5%
Canada’s Export in Merchandise$524.0 billion2.4%$517.0 billion3.0%
Summary table IV: Base case and sensitivity analysis
Base case
 20152016
Total Spending (billion)$12.8$15.5
GDP (billion)$10.5$12.8
Employment140,010168,860
Tax Revenue (billion)$2.3$2.8
10% higher annual total spending by all international students in Canada – Combined direct and indirect impacts, 2015 and 2016
 20152016
Total Spending (billion)$14.1$17.1
GDP (billion)$11.6$14.1
Employment154,000185,700
Tax Revenue (billion)$2.6$3.1
10% lower annual total spending by all international students in Canada – Combined direct and indirect impacts, 2015 and 2016
 20152016
Total Spending (billion)$11.5$13.9
GDP (billion)$9.4$11.4
Employment125,200150,800
Tax Revenue (billion)$2.1$2.5

View/download the complete report “Economic impact of international education in Canada - 2017 update”


[1] Statistics Canada reports that the export value of Canada’s education-related travel services was $5.827 billion in 2015. The analysis in this report builds on that number by exploring and adding other areas of export revenues, such as including K-12 students and Languages Canada’s short-term students.

[2] Total number of students includes long-term and short-term students. It should be noted that the total number of long-term students reported here does not correspond with the figure reported on IRCC’s website regarding the number of international students with a valid permit on December 31, as we have made a number of adjustments to arrive at these values. It should also be noted that RKA estimated the number of short-term Languages Canada students in 2016, as no data from Languages Canada was available at the time the report was prepared.

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Date Modified:
2018-02-07