Economic impact of international education in Canada - 2020 update

Global Affairs Canada - Canmac Economics Limited - August 2020

Executive summary

View/download the complete report Economic impact of international education in Canada 2017 – 2018 (PDF, 5.05 MB)

Existing literature, as well as the previous studies on the economic impacts of international education clearly indicates that there is a significant positive value associated with international students studying in Canada. The current study assesses the economic impact that international students studying in Canada in 2017 and 2018 had on the Canadian economy.

We estimate that in 2017 and 2018 respectively, international students in Canada spent $18.4 billion and $22.3 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.

  • The total annual expenditures of international students, including their visiting families and friends, contributed $18.4 billion and $22.3 billion to economic activities in Canada in 2017 and 2018, respectively. This translates into a $16.2 billion and $19.7 billion contribution to Canada's GDP in 2017 and 2018, respectively.
  • GDP contributions 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 16.3% growth in the number of long-term international students in 2018 accounts for most of the higher spending and associated economic impact compared with 2017. Students from India contributed most to this overall increase, with Ontario accounting for the biggest increase in the number of international students.
  • In 2018, Ontario, with the largest number of students, made the largest contribution to GDP with 55.3% of the total followed by British Columbia, with 19.8% and Quebec, with 11.9%.
  • The amount of international students' overall annual spending translates to 180,041 jobs supported in the Canadian economy in 2017. The comparable value in 2018 was 218,577 jobs supported.
  • International students' annual spending directly and indirectly contributed $3.1 billion in tax revenue in 2017. The comparable value in 2018 was $3.7 billion.

Because international students' expenditures represent revenue for goods and services from overseas, they are Canadian exports of education services.

  • In 2017, the value of international education services, as measured by total spending by international students in Canada amounted to 15.0% of Canada's total service exports to the world. This value increased in 2018, accounting for 17.4% of our total service exports.
  • The top 10 source countries accounted for $13.9 billion in international student spending in 2017, which translates to 16.9% of the total service exports. In 2018, these countries accounted for $17.0 billion in international student spending, which translates to 18.6% of the total service exports.
  • In 2018, long-term international students accounted for 95.9% of the total spending by international students.

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

Summary Table 1: Number of international students and total annual spending in Canada, by province and territory, 2017 and 2018
Region2017 All Students2017 Total Annual Spending (millions)2018 All Students2018 Total Annual Spending (millions)
Newfoundland and Labrador3,609$76,065,4754,047$92,775,232
Prince Edward Island2,767$80,101,8753,472$103,635,267
Nova Scotia15,413$419,924,82918,535$526,612,816
New Brunswick5,683$126,310,4496,773$157,071,706
British Columbia155,144$4,029,287,321180,201$4,708,178,855
Summary Table 2: Direct and indirect economic impacts of all international students, by province and territory 2017 and 2018 (000’s)
Region2017 Output2017 GDP2017 Labour Income2017 Employment2018 Output2018 GDP2018 Labour Income2018 Employment
Newfoundland and Labrador$109,853$68,127$40,405793$131,955$83,134$50,015972
Prince Edward Island$95,751$61,346$38,160751$123,995$79,599$49,469971
Nova Scotia$513,289$334,300$209,7214,564$641,804$421,594$265,3815,732
New Brunswick$194,653$114,281$69,4111,519$240,422$142,375$86,6191,882
British Columbia$4,948,021$3,370,592$2,081,85638,478$5,797,280$3,988,723$2,454,32945,164

Source: Computed by Canmac Economics, Statistics Canada I-O Model

Summary Table 3: Comparison of international education services, as measured by total spending by international students, and Canada’s service and merchandise exports, 2017 and 2018
 2017 Value (billions)2017 International Student Spending as a % of Exports2018 Value (billions)2018 International Student Spending as a % of Exports
Total annual spending – all international students$18.50n/a$24n/a
Canada’s exports in services$122.3015.13%$128.218.72%
Canada’s exports in merchandise$546.103.38%$584.44.11%