Universities hailed as key to economic prosperity in British cities – UKTN

Local universities are a leading source of international exports, knowledge sector employment, startup creation and community regeneration, according to new research from think tank Centre for Cities.

It found that, in large cities and towns across the UK, higher education institutions are crucial international exports that attract inward investment from foreign students who typically pay higher tuition fees.

Universities in Exeter, Dundee and Leicester have international export values of 15%, respectively. Nottingham came second with an international export value of 8%.

In Cardiff, Sheffield and Brighton, local universities outflank many other “knowledge” industries when it comes to international exports.

Cardiff’s universities boast an international exports value of 8% compared to the 4% generated by the Welsh capital’s legal firms.

Sheffield’s higher education sector generates 7% of its international exports, more than the 4% generated by metal manufacturing.

And Brighton’s business support services sector is outnumbered by universities for international exports – 5% compared to 6%. 

Generating jobs 

Along with being crucial sources of international exports, local universities also offer plenty of job opportunities for knowledge workers when such roles in other industries are sparse in British towns and cities.

In Oxford, its two universities are responsible for 60% of the city’s knowledge jobs and one in six of every type of job. Higher education institutions in Coventry (40%) and Cambridge (39%) are also responsible for the most knowledge sector employment in their respective cities.

Plymouth (32%), Stoke (31%), Hull (24%) and Sunderland (18%) also have high numbers of knowledge roles compared to other sectors. 

Universities are also credited with improving the redevelopment and prosperity of cities like Coventry, Liverpool and Nottingham by bringing high numbers of young people to study, work and live in them. 

As well as job generation, universities also help create startups that fuel Britain’s economy. From 2012 to 2024, they spun out 2,000 firms. 40% of them were in London, Cambridge and Oxford.

The impact of the proposed levy 

But the Centre for Cities is concerned that all this could be at stake due to the Labour government’s proposed International Student Levy, which would result in universities paying a 6% surcharge on international student tuition fee income. 

Andrew Carter, chief executive of Centre for Cities, said: “Many universities may be small in national terms, but they are central to their local economies, particularly outside the UK’s strongest cities.

“But many UK universities are under financial strain, raising questions about their future. Any changes to higher education policy will not be felt evenly across the country.”

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