REPORT 2014-2015

UK POST-STUDY INTERNSHIPS FOR CHINESES STUDENTS

AUGUST 2015

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Overview

About Tier 5 GAE Visa Sponsorship

With approval by UKVI (UK Visa and Immigration) Home Office, International Student Internship Scheme acts as the overarching body for the Tier 5 GAE (Government Authorised Exchange) Visa scheme that helps UK companies recruit Chinese interns without any concern for potential visa issues.

About

International Student Internship Scheme

The International Student Internship Scheme is approved by the Home Office and UK Visas & Immigration (UKVI) under the Tier 5 Government Authorised Exchange programme.

ISIS, which was set up with the endorsement of the Department for Business, Innovation and Skills and the Department for UK Trade and Investment, has enabled graduates to undertake internships for employers in the UK and thus share and gain valuable knowledge and experience in their academic field which will help them in their future careers. It has had a particular focus on Chinese students and UK companies with an interest in the Chinese market and its objective is to promote UK­China trade and commerce.

About this report

This report is the first annual summary from International Student Internship Scheme, based on its work during 2014­2015, observing the current situation for post­study internships for Chinese students in the UK.

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Table of Contents

Overview About Tier 5 GAE Visa Sponsorship About International Student Internship Scheme (ISIS) About this report

1. Introduction 1.1 UK­China trade relations 1.2 Cooperation in technology, culture and education 1.3 International students in the UK 1.4 Post Study Work route in the UK

1.4.1 Closure of the Tier 1 PSW route 1.4.2 Tier 2 (General) 1.4.3 Tier 1 (Graduate Entrepreneur) 1.4.4 Tier 4 (Doctorate Extension Scheme) 1.4.5 Tier 5 (Temporary Worker ­ Government Authorised Exchange)

2. Sample collection and data analysis 2.1 Subjects studied by Chinese students 2.2 English language levels 2.3 Current year of students 2.4 Subjects of students sponsored

3. Support and assistance from universities 3.1 Chinese student enrolment in UK universities 3.2 Universities with most Chinese students sponsored with Tier 5 visas 3.3 University career services

4. Talent need for companies 4.1 Trends in UK­China Trade stimulate talent needs 4.2 Reasons for companies to hire Chinese students via Tier 5 visas 4.3 Students’ whereabouts after their internship

5. Key findings and conclusion 5.1 The UK government encourages and welcomes Chinese students to study in the UK, and supports the students with Tier 5 GAE ISIS internship visa to help Chinese students gain work experience 5.2 More Chinese students are coming into and return back from the the UK and are more aware of career planning 5.3 Statistics show good level of English and cover of subjects; a majority of which are business related but are diversifying in which STEM vacancies are the hardest to fill 5.4 UK universities increasingly support Chinese students with their career planning 5.5 Internships strengthened business links between China and the UK, and stronger links offer more internship opportunities to Chinese students

6. Appendix: main index

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1. Introduction

1.1 UK-China trade relations The UK is China’s third largest trade partner in the EU, while China is the UK’s second largest trade partner outside the EU.In 2014, the bilateral trade between the two coutries reached 80.87 billion US dollars, up 15.3% year on year. The export from China was US$57.14 billion, with 12.2% increase, and the import was US$27.33billion, with a 23.5% increase. The UK is China’s second largest investment origin within the EU, the major foreign investment destination and the largest offshore RMB trading centre; apart from Hong Kong. By the end of 2014, China’s direct investment into the UK totaled US$11.8 billion, 15 time that in 2008. Investment projects from the UK in China increased 21.6% year on year to 7,764, worth US$19.2 billion, among which 287 was created in 2014 with investment worth US$ 740 million, up 87.6% from the previous year.

1.2 Cooperation in technology, culture and education Technology, culture and education have been the main areas of cooperation between China and the UK. The two countries have signed intergovernmental technology cooperation agreements and more than 20 science and technology cooperation agreements and memoranda. Currently, the major cooperation programmes and projects under implementation include: UK­China Science Bridge, new energy and renewable energy programmes, Innovation China UK, and RCUK China Office. In April 2014, the second meeting of China­UK high­level people­to­people exchange mechanism was held in Beijing, and both parties signed the meeting minutes. The third meeting will be held in London in September, 2015. Which, coincidently, is also the Year of Cultural Exchange between China and the UK. In March 2015, Year of China­UK Cultural Exchange ­ UK Cultural season was held in Shanghai. Around 7,500 UK students are currently studying in China. China has setup 25 Confucius Institutes and 101 Confucius Classes in the UK, which tops in number in Europe. In addition, over 600 primary and secondary schools now teach Chinese as a course. Up until February 2015, there were 9 UK education cooperative institutions and 235 projects in China.

1.3 International students in the UK With 87,895 international students sent from China in 2013­14 (most graduating 2014­15), UK falls only behind the US as the second largest destination for Chinese students going for a full degree education. However, the direction of policy in the UK continues to restrict international graduates’ post­study work opportunities and partly targets overseas students to reduce the level of migration. The tightened immigration policy towards non­EU international students has had a very significant impact on the number of international student sent to the UK from India, while there has been a steady growth of those from China (including Hong Kong SAR), which are the two major international student senders to the

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UK. In 2024, China is expected to account for 44 per cent of growth in inbound postgraduates to the 1

UK.

Source: Higher Education Statistics Authority (HESA),2015 2

1.4 Post Study Work route in the UK

1.4.1 Closure of the Tier 1 PSW route According to the immigration statistics below, extensions of stay to former students in the UK made under the Tier 1 Post Study Work route peaked in 2011, at 43,319. The route closed in April 2012, but existing applications continued to be processed after this date. This resulted in a decline in Tier 1 PSW visa grants to 34,895 in 2012, and to 557 in 2013. Following closure of Tier 1 PSW, however, there has not been a corresponding rise in the number of visas issued to non­EEA graduates in other categories. Category 2009 2010 2011 2012 2013

Tier 1 Total 65,900 54,306 66,403 57,327 24,879

of whom were previously students .. .. 44,246 35,476 1,595

of which:

Tier 1 ­Post Study 34,181 33,973 43,719 35,245 572

of whom were previously students .. .. 43,319 34,895 557

Tier 2 Total 20,135 21,204 18,195 29,516 37,654

of whom were previously students .. .. 1,730 2,614 4,175

1 British Council: POSTGRADUATE_MOBILITY_TRENDS_2024­OCTOBER­14 2 UK Higher Education Statistics, Higher Education Statistics Authority, accessed online in January 2015: http://m.hesa.ac.uk/uk­he­stats/?p=&y=11/12&l=&n=

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Tier 5 Total 76 395 627 789 1,074

of whom were previously students .. .. 0 134 210

Source: Immigration Statistics April ­ June 2014 3

1.4.2 Tier 2 (General) Following the decision to close the Tier 1 PSW route, the Government indicated that Tier 2 (General) would be the primary route by which non­EEA graduates could seek to remain in the UK for work after their studies. In order to switch into Tier 2 (General) following a period of leave to remain in the UK under Tier 4, non­EEA graduates must have a valid offer of employment from a registered Tier 2 (General) sponsor prior to expiry of their leave. The offer of employment must be for a graduate level role (NQF level 6 or above), with a minimum salary of £20,800 per annum, or the ‘appropriate level’ for that occupation (whichever is higher). However, evidence suggests that Tier 2 (General) has not been able to provide adequate opportunities for UK employers to employ skilled and highly­skilled non­EEA graduates, the reason being:

1. There are a limited number of companies which have Tier 2 sponsorship licence to hire Non­EU graduates.

2. The application process for the Tier 2 sponsorship licence is complicated and the UK government is tightening the visa requirement in this category.

3. The licence holder bears immigration compliance liabilities and monitoring responsibilities 4. There is a limited quota for the number of Non­EU employees the licence holder can hire 5. The licence holder will have to carry out a resident labour market test, to ensure the company

has to recruit from overseas because no one is more suitable for the job within the EU. 6. There is also the minimum salary criteria, which is higher than £18,000 , the average British 4

graduate salary.

1.4.3 Tier 1 (Graduate Entrepreneur) The Tier 1 (Graduate Entrepreneur) visa is intended to provide a route for foreign graduates who are ‘officially endorsed as having a genuine and credible business ideas’ to remain in the UK as outlined in Section 4. The Government issues 2000 visas per annum available under this route every year. Evidence received by this inquiry suggested however that, since its introduction, this visa route has only been used by a very limited number of students. The NUS found that Tier 1 (Graduate Entrepreneur) has ‘encountered many problems in practice’. 14% of the 1599 students surveyed by the NUS in 2014 said that they wished to set up a business in the UK. 5

However, less than 20% of those who wished to set up a business following graduation had considered the Tier 1 (Graduate Entrepreneur) visa, and just 2% had actually applied for this visa. For example, the

3 Entry Clearances: Overseas Students: Written question –215097, 25 November 2014, Available online at: http://www.parliament.uk/business/publications/written­questions­answers­statements/written­question/Commons/2014­11­18/215097/ 4 https://www.gov.uk/tier­2­general/eligibility 5 NUS

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number of Chinese graduates who entered the UK with a Tier 1 Graduate Entrepreneur visa was only 19 in 2014 and only 9 in the first quarter of 2015 . 6

1.4.4 Tier 4 (Doctorate Extension Scheme) The Tier 4 Doctorate Extension Scheme was intended to enable current students approaching the award of a UK PhD or other doctorate qualification to apply for a further 12­month period of leave under Tier 4 (General), in order to gain work experience in the UK. However, data indicates that a low number of graduates use this route – just 434 visas were issued in 2013 . 7

1.4.5 Tier 5 (Temporary Worker - Government Authorised Exchange) There are two categories under the Tier 5: Youth Mobility Scheme and Temporary Worker. Temporary Worker Tier 5 visa includes: Charity Worker, Creative and Sporting, Government Authorised Exchange, International Agreement and Religious Worker. In April 2014, to encourage international students to study in the UK, the Home Office added the International Student Internship Scheme under the Government Authorised Exchange programme, for two reasons:

1) China has become the largest source of the UK’s international students; a certain percentage of graduates return back to China every year facing fierce competition, which raises the demand for work experience among the students before leaving the UK

2) The trade links between China and the UK continue to develop, asking for dramatic increase in Chinese talent from the students who master both languages, understand the respective culture, and are hardworking.

the International Student Internship Scheme was then born out of a necessity with endorsement from the Department for Business and Skills and UK Trade and Investment and approval from UK Visa and Immigration, as the only visa scheme specifically design for Chinese students. Chinese graduates from a UK university can switch from a Tier 4 student visa to an ISIS Tier 5 GAE (up to 12 months) visa in the UK. It is also applicable for graduates from 211/985 universities to apply for the Tier 5 GAE visa from China once they have secured an internship offer.

2. Sample collection and data analysis From April 2014, 9,146 Chinese students have joined our HR database of the International Student Internship Scheme, who expect to gain post study work experience in the UK. Based on 88,000 Chinese students coming into the UK and 83% returning back to their home countries after studies, over half of the them who stayed in the UK and worked have joined our HR database during the job hunting process, which also makes the sampling highly representative Such information has been collected through websites, questionnaires, telephone interviews, face to face interviews and with assistance from international offices and career services of 64 universities in the UK and 28 Chinese 211 universities.

6 Home Office 7 University UK

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This database started to collect student data from April 2014, therefore this first report lacks a comparison with previous data and only provides open loop statistical analysis. In future reports, relevant data of UK­China trade, employment, import and export and regression analysis will be included to eliminate Type I and II error, to demonstrate the contribution of the internships by Chinese students to the trade between the two countries within a certain confidence interval.

2.1 Subjects studied by Chinese students Business studies related subjects are still the mainstream among Chinese students, but facing a slight decrease and more diversification.

source: PostStudy database

2.2 English language levels Around 70% of the Chinese students scored between 6 and 7 in the IELTS test, showing a good standard of English required by most subjects and evidence of language ability to be presented to the potential employers.

source: PostStudy database

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2.3 Current year of students Those who are keen and active in looking for internship positions are mostly those who are in their final year of study. e.g. undergraduate year 3 students and PGT students.

2.4 Subjects of students sponsored Out of all the students who secured an internship and tier 5 visa sponsorship, over 60% of them studied business, accounting and finance, media or art and design. Top three vacancies difficult to fill are engineering, computer science and mobile technology, STEM subjects. This is also partially due to the fact that enrolment of students from India into STEM courses has dramatically fallen, leaving the there job relevant talents short of supply.

3. Support and assistance from universities

3.1 Chinese student enrolment in UK universities In 2014, British Council China published statistics on top 20 UK universities that recruited most Chinese students.

Rank Universities, top Chinese student enrolment

1 The University of Liverpool

2 The University of Manchester

3 The University of Nottingham

4 The University of Birmingham

source: PostStudy database

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5 The University of Sheffield

6 The University of Southampton

7 The University of Newcastle upon Tyne

8 The University of Leicester

9 University College London

10 The University of East Anglia

11 The University of Warwick

12 The University of Glasgow

13 The University of Edinburgh

14 The University of Exeter

15 Cardiff University

16 Sheffield Hallam University

17 The University of Hull

18 Imperial College

19 The University of Bristol

20 University of the Arts, London

3.2 Universities with most Chinese students sponsored with Tier 5 visas Top 30 universities with most Chinese­speaking students sponsored by ISIS Tier 5 visa are listed below. Some government authorities working closely with universities are increasingly aware of the importance of Chinese talents and their possible contribution to the local economy by working for local companies. A very good example is the Great Ambassador (China) Scheme set up by the University of Sheffield and UK Trade & Investment, aiming to link UK organisations that are seeking to develop business opportunities with China with the students who have knowledge of the Chinese language, by providing students with work placements with such companies . 8

Rank, number of Tier 5 visas

1 University of Manchester

2 University of Warwick

3 University College London

4 University of Bristol

5 University of Southampton

6 London School of Economics

7 University of the Arts London

8 BBC

Post Study Sponsored Post Study sponsored student from

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8 University of Birmingham

9 University of Leeds

10 Imperial College London

11 University of Glasgow

12 University of Westminster

13 University of Leicester

14 Cardiff University

15 Coventry University

16 University of Exeter

17 Goldsmiths, University of London

18 University of Sheffield

19 University of East Anglia

20 Queen Mary, University of London

21 Royal Holloway, University of London

22 King's College London

23 University of Surrey

24 Loughborough University

25 Newcastle University

26 University of Reading

27 BPP University

28 The University of Bath

29 Tsinghua University

30 Bangor University

Data shows the number of Chinese students sponsored by Tier 5 visas are in line with the total number of the Chinese student number in that university, which to some extent means the university focuses on the practicability of courses and career planning of the Chinese students.

3.3 University career services The most important career related resource that students could access from their universities were career services during the process of job hunting. Over 70% of the Chinese students actually had advice from their career service at university before finally succeeding in finding an internship. These services include: frequent career planning seminars, career skills training, CV clinic, mock interviews and career fairs.

source: PostStudy database

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source: ISIS database

4. Talent need for companies

4.1 Trends in UK-China Trade stimulate talent needs While the UK’s trade balance with China, according to ONS, has been stabilised for the last 6­7 years, the UK’s service and goods exports to China is catching up with imports from it, which generated at least 5 fold in the meantime based on the statistics. Behind these figures, there are a huge number of companies across various sectors that are involved in doing business with China and the record high trades between the two countries call for talent who understand the culture, language, law and businesses on both sides to assist in the success of UK companies’ when expanding into the biggest market in the world.

Source: Office for National Statistics Evidently, over recent years, there has been a steady rise in the proportion of businesses rating 9

Mandarin as useful, up from 25% in 2012 to 31% in 2014, reflecting the phenomenal growth of the Chinese economy and the expanding trade and investment links of UK companies.

9 CBI: http://www.cbi.org.uk/media/2809181/embargo_00.01_4_july_cbi_pearson_education_and_skills_survey_2014.pdf

www.ukisis.org The roles of internships being of supernumerary nature has made the process of companies hiring Chinese speaking graduates more straight forward, as the roles do not count towards the headcount in the labour market.

4.2 Reasons for companies to hire Chinese students via Tier 5 visas Major firms needed Tier 5 sponsorship on different occasions, mainly to prepare the Chinese students for their China business. Companies such as UBS, Bank of China and Moody’s in the financial industry, IMI and Huawei in ICT, Taylor Wessing in law, Laureus in event and sports, and Moore Stephens in accounting have done so for the following reasons,

1) the employer does not have to worry about immigration compliance and responsibilities 2) to take the students as an effective supplement to the company's’ existing graduate scheme 3) to assess the candidate's’ ability and potential during the 3­12 months internship 4) to train candidates before having them work in branches in China 5) to sort out visas for employees to have training at UK headquarters 6) to avoid the quota restrictions for the Tier 2 visa

4.3 Students’ whereabouts after their internship 1) to switch to permanent employees and be responsible for China related business 2) to be assigned back to China, and work for a China branch 3) to seek employment in other companies in China and the UK 4) further study

5. Key findings and conclusion

5.1 The UK government encourages and welcomes Chinese students to study in the UK, and supports the students with Tier 5 GAE ISIS internship visa to help Chinese students gain work experience Although the direction of the UK’s immigration policy restricts the post study work opportunities in the UK for international students, the setup of the International Student Internship Scheme endorsed by BIS and UKTI shows the UK’s appreciation of the contribution to the economy from the Chinese students and emphasises the bilateral relationship with China in trade, education and culture.

5.2 More Chinese students are coming into and return back from the the UK and are more aware of career planning The number of international students to study in the UK sent from China has been growing steadily. In 2024, China is also expected to account for 44 per cent of growth in inbound postgraduates to the UK.

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Majority of the Chinese students in the UK for their further studies for undergraduate or master’s degrees choose to go back to China. However, they face increasing competition in the labour market from other graduates who have returned from studying abroad. Apart from the Tier 2, the Tier 5 internship visa has become a sensible choice for students to gain work experience before leaving the UK.

5.3 Statistics show good level of English and cover of subjects; a majority of which are business related but are diversifying in which STEM vacancies are the hardest to fill Evidence shows that most Chinese students show a good level of English, making the language ability acceptable when hired by UK companies, even though there is no minimal requirement of language. Of all students, about half of them are studying business studies, accounting and finance; of all the vacancies, STEM related ones are the hardest to fill.

5.4 UK universities increasingly support Chinese students with their career planning Career services and international offices at UK universities are playing a very important role in helping Chinese students with CV and cover letter surgeries, mock interviews, language training, and employer engagement, preparing the students for their prospective employment in the UK. The universities are increasingly supporting Chinese students as there has been higher enrolment of them and the universities are also aiming for higher employability among international students. The universities are also seeking more pro­activity from Chinese students.

5.5 Internships strengthened business links between China and the UK, and stronger links offer more internship opportunities to Chinese students

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6. Appendix: main index Entry Clearances: Overseas Students: Written question –215097, 25 November 2014, Available: http://www.parliament.uk/business/publications/written­questions­answers­statements/written­question/Commons/2014­11­18/215097/ Last accessed 19 Jun 2015. gateway to growth：CBI/Pearson education and skills survey 2014, Available: http://www.cbi.org.uk/media/2809181/embargo_00.01_4_july_cbi_pearson_education_and_skills_survey_2014.pdf Last accessed 19 Jun 2015. Gower, Melanie. (2012). Immigration: Tier 1 (post study work) visas. Available: http://www.parliament.uk/business/publications/research/briefingpapers/SN05881/immigration­tier­1­post­study­work­visas Last accessed 15 May 2015. Higher Education Statistical Authority. (2014). UK HE Stats 2008 to 2013. Available: http://m.hesa.ac.uk/uk­he­stats/ Last accessed 19 Jan 2015. Home Affairs Select Committee. (2011). Student Visas. Seventh Report of Session 2010–11. Available: http://www.parliament.uk/documents/commons­committees/homeaffairs/Studentvisas.pdf Last accessed 19 Jun 2015. Home Office. (2011). Reform of the Points Based Student (PBS) Immigration System. Impact Assessment HO0025. Available: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/257825/iastudents­.pdf Last accessed 19 Jun 2015. UK post study work opportunities for international students 2014­2015. Available: http://www.appgmigration.org.uk/sites/default/files/APPG_PSW_Inquiry_Report­FINAL.pdf. Last accessed 19 Jun 2015. Science and Technology Select Committee . (2014). International Science, Technology, Engineering and Mathematics (STEM) students. 4th Report of Session 2013–14. Available: http://www.publications.parliament.uk/pa/ld201314/ldselect/ldsctech/162/162.pdf Last accessed 19 Jun 2015. accessed 19 Jun 2015. UK Visas & Immigration. (2014). Tier 2 and 5 of the Points Based System Guidance for Sponsors. Available: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/428196/Tier_2__5_Sponsor_Guidance__v_1_1.pdf Last accessed 19 Jun 2015. UK Visas & Immigration. (2014). Tier 2 of the Points Based System – Policy Guidance. TIER 2 Version 11/14. Available: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/421842/Tier_2_Guidance_04_2015.pdf Last accessed 19 Jun 2015.

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Contact: International Students Internship Scheme The Podium, 1 Eversholt Street, London, NW1 2DN T: 0207 554 0803 | E: info@ukisis.org | W: www.ukisis.org