A new economic study has found that international students are a massive boon for Germany’s coffers — even if they get their education free of charge. German industry is now doing more to recruit foreign students.
According to a study released last week by the German Economic Institute (IW), international students contribute billions of euros to Germany’s treasury and also aid in boosting economic development.
The research team from Cologne determined that the 79,000 international students starting their studies in Germany in 2022 will contribute approximately €15.5 billion ($16.8 billion) more in tax payments and social security over their lifetimes compared to what they would receive in benefits.
Joybrato Mukherjee, who serves as the president of the German Academic Exchange Service (DAAD) and was behind the commissioning of this study, stated in a release that the results indicated international students contribute significantly to their nation, both academically and economically.
Germany boasts a robust retention rate for international students: A 2022 OECD report indicated that approximately 45% of individuals arriving in Germany with a student visa back in 2010 remained in the country a decade later. At this point, these students had largely offset the expenses associated with their education: Research conducted by the IW revealed that the costs of educating these students would be recouped through their tax payments and social security contributions if at least 40% stayed for three years following graduation.
Why students like Germany
Many factors could have drawn international students to Germany, but what particularly appealed to Younis Ebaid, an Egyptian software engineer who relocated to Ingolstadt in 2021 to pursue an English-taught master’s degree in automotive engineering at the Technical University of Applied Sciences (THI) in this Bavarian town, stood out from the rest.
“The initial choice was English-speaking nations; however, they tend to be extremely costly,” explained the 28-year-old to SANGGRALOKA. “Among them, Germany turned out to be the most budget-friendly alternative.” This decision was influenced by the fact that nearly all academic establishments in Germany do not impose tuition fees on domestic or international students alike. While Germany implemented this policy regarding free tertiary education with considerations around fairness several years back, it currently serves as a significant draw for attracting talented professionals to their nation.
“We primarily cover public semester fees, with mine amounting to €60 each semester at my German university—this cost is significantly lower compared to what I paid back in Egypt,” explained Ebaid. The city of Ingolstadt, population approximately 140,000, offers additional allure as the birthplace of Audi; this automotive powerhouse supports considerable research efforts conducted at THI. According to Ebaid, numerous faculty members have backgrounds from within Audi itself. “The entire community seems deeply engaged with automobiles here, making it an excellent choice overall,” he concluded.
Working students
However, the cost of living in Bavaria is significantly greater compared to Egypt, and since Ebaid couldn’t afford to live without an income, he secured part-time employment as a software developer in Munich through assistance from the local university services.
Wido Geis-Thöne, a senior economist at IW and co-author of the new report, highlighted this as the primary unexpected finding: “International students are contributing during their studies since many secure jobs afterward.”
The challenging aspect, though, lay in the shift following graduation. These part-time positions facilitated through universities are exclusively for students—once they have completed their studies, international graduates become subject to the whims of the employment landscape; particularly in Germany.
automative industry
is presently going through a difficult time.
Both Audi
and
Volkswagen has been letting go of employees.
in recent months.
“When I initially arrived in Germany, the economy was thriving,” stated Ebaid. “However, after completing my master’s degree in 2024, things began to deteriorate. It took me eight months of applying before securing this full-time position.”
He bridged that gap through his experience at restaurants and hotels, but now Ebaid works as a software development engineer for an international Indian firm specializing in automotive software solutions for German manufacturers. “I felt fortunate,” he commented, “as it was among the rare businesses securing new projects.” He also noted how some of his previous classmates had been job hunting unsuccessfully for over twelve months.
Here to stay?
Ebaid’s insights align with IW’s conclusions. According to Geis-Thöne, Germany has been working for about ten years now to establish the necessary legal groundwork to facilitate the retention of international students within the country. He noted that this approach differs from what prevails in much of the English-speaking world, where policies often do not genuinely encourage these students to remain permanently due to certain regulatory obstacles.
In many countries, international students might be primarily viewed as an additional revenue stream for educational institutions. However, in Germany, industries have started treating university campuses more like talent pools for hiring. This observation was shared by Ebaid: “I believe the current system is quite effective,” he stated. “Our university conducted workshops on crafting a strong CV, excelling in interviews, and entering the German job market. Additionally, they host annual career fairs where various companies come directly to our campus.”
Ebaid mentions that his initial intention was to remain in Germany following his education—although currently, due to the nation’s financial challenges, he has doubts about whether he can continue living there indefinitely. He explained, “The primary issue is that major corporations are experiencing losses, leading them to shut down numerous projects and lay off many employees.”
Even though Germany seems to be excelling in many areas, there is still significant scope for enhancement. According to Ebaid, his primary issue with Germany revolves around the inflexibility within bureaucracy regarding language use. He mentioned, “At certain governmental departments, all information is provided solely in German, even though staff members know English; however, they insist on communicating exclusively in German.” He suggested this could be improved by being more accommodating toward linguistic barriers.
Although Ebaid doesn’t require German for his current position, which uses English as the primary language, he is studying it with the aim of securing permanent residency. “My life would be considerably simpler if I were more fluent in German,” he commented. “I’ve faced rejection from numerous firms simply because they operate primarily in German.”
The IW proposed several strategies for improving the integration of graduates into the workforce, such as promoting targeted immigration—though this should not be seen as an ultimate objective. According to the IW, educating individuals from around the globe inherently benefits Germany because it enhances relationships with other nations and cultivates an international academic community—even more so when these students return home following their education.
Edited by Rina Goldenberg
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Author: Ben Knight
