America's higher Ed bubble at risk as Indian, Chinese students retreat

US universities are cutting budgets as international enrolments plunge under Trump's visa curbs, with DePaul reporting a 30% fall this autumn

US universities are starting to see the impact of President Donald Trump’s tightening of immigration and education policies, with enrolments from abroad dropping and budgets under strain.

 

DePaul University in Chicago has told faculty it will immediately cut spending after seeing international enrolment fall by 30 per cent this autumn.

 

“The amount of the reduction is to be determined, but measures could include a hiring freeze, executive pay cuts and discretionary spending limits,” wrote university president Robert Manuel in a memo to staff on Tuesday, according to Reuters.

 

Enrolment drop at DePaul

 

DePaul’s total international enrolment fell by 755 students compared with last year. The number of first-year international graduate students plunged nearly 62 per cent.

 

 

The university, which enrolled 21,000 students last year including about 2,500 from abroad, attributed the decline to visa delays and waning interest in studying in the US.

 

“We are all worried about the safety of our community members, the safeguarding of academic freedom, and the new financial challenges driven by changes in federal funding and visa processing,” said Manuel. “These concerns are so severe and debilitating that it’s getting hard to recognise higher education anymore.”

 

Other universities cutting back

 

DePaul is one of at least 35 universities to announce cutbacks. Johns Hopkins University laid off more than 2,000 staff in March after losing $800 million in federal research grants. Northwestern University reduced 425 positions, while the University of Southern California shed over 630 jobs. Each cited falling enrolments and reduced federal funding.

 

Visa hurdles and government stance

 

The Trump administration has introduced new visa checks, including requiring students to make social media accounts public during the application process. Some visas have been revoked and others delayed.

 

Tricia McLaughlin, assistant secretary at the Department of Homeland Security, said foreign students must remember they are “guests” in the country.

 

“This isn’t that hard,” said McLaughlin. “If you are living and studying in the United States on a visa, you are a guest in this country. Act like it. If you are a foreign student pushing Hamas propaganda, glorifying terrorists, harassing Jews, taking over buildings, or other anti-American actions, you can book yourself a ticket home. You can expect your visa will be revoked.”

 

In May, the government temporarily blocked Harvard University from enrolling international students, citing failures to address antisemitism and harassment. A district court later paused the action, but the government has appealed.

 

Numbers already sliding

 

Early figures suggest the downturn is nationwide. According to the US Department of Homeland Security’s Student and Exchange Visitor Program, international student numbers in September fell 2.4 per cent year-on-year, from 965,437 to 942,131.

 

Some 1.2 million international students studied in the US during the 2024–25 academic year, according to NAFSA: Association of International Educators. In July, NAFSA projected that this number could fall by as much as 15 per cent in 2025, costing the US economy nearly $7 billion.

 

Dr Fanta Aw, executive director and CEO of NAFSA, said declines among first-year graduate students are especially damaging. “When admitted first-year master’s students opt not to enrol, a school loses their tuition for two years,” she said.

 

International students often pay full tuition and are not eligible for financial aid, making them a crucial revenue source for universities facing falling domestic enrolment and higher operating costs.

 

India and China hardest hit

 

India became the top sender of international students to the US in 2024, with more than 331,000 students, nearly 200,000 of them at graduate level. But fresh enrolments are slowing fast.

 

• Arrivals from India fell 45 per cent in August 2025 compared with last year

• Arrivals from China dropped 12 per cent

• Overall student arrivals from Asia fell 24 per cent

 

Data from the International Trade Administration show student arrivals dropped 19 per cent year-on-year in August to just over 313,000, the lowest August intake since the Covid disruption of 2021.

 

Billions in lost revenue

 

International students contributed nearly $44 billion to the US economy in 2023–24 and supported almost 400,000 jobs. NAFSA estimates that every three international students help create one US job.

 

With enrolments falling, universities warn that revenue losses could deepen in the coming months. Moody’s credit ratings agency said schools that rely heavily on international graduate students are the most vulnerable.

 

“Graduate students often pay higher tuition fees for certain programmes, so the loss of these students could have a particularly severe revenue impact,” Moody’s noted in its June report.

 

With inputs from Reuters