The proposed international student levy would be felt ¡°unevenly¡± across the UK and hit regional economies the hardest, according to a new report.

Introduced in the government¡¯s immigration White Paper in May, the plans could see 6 per cent of international tuition fees reinvested into the higher education and skills system.

New analysis from Centre for Cities shows that local universities are the top international exporting sector in a number of cities ¨C responsible for 15 per cent of exports in Exeter, Dundee and Leicester and 8 per cent in Nottingham.

As might be expected, higher education institutions make up a large portion of all knowledge jobs in areas such as Oxford and Cambridge. But they are also responsible for a big share of this sector in Stoke, Sunderland and Hull.

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Researchers said these regional benefits came directly from the fees that international students pay and warned that any changes to higher education policy will not be felt evenly across the country.

On top of pressing financial worries, Centre for Cities also highlighted how the current policy context is creating additional uncertainty for the sector.

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¡°Along with some less-than-supportive rhetoric from politicians, the sector is unsure where it lies in the government¡¯s list of priorities as it awaits the Skills White Paper,¡± it said.

Universities have repeatedly warned that the proposed levy ¨C which blindsided vice-chancellors ¨C will lead to more job cuts.

As well as being high-skilled employers, international exporters and innovators, the report said that universities are also key instruments of urban regeneration by attracting people to live in city centres and focusing economic activity in one place.

Students make up more than 10 per cent of the local population in university towns across the UK. Although they have reduced spending power, they can help raise the quality of local high streets and certain amenities, such as nightlife venues, and reduce vacancy rates.

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They also bring in investment for developments such as purpose-built student housing ¨C as has happened in cities such as Coventry, Liverpool and Nottingham.

Andrew Carter, chief executive of Centre for Cities, said universities are significant economic assets in places that have relatively little private sector high-skilled employment or international exports.

Local universities¡¯ share of high-skilled knowledge jobs is notably high in places ¨C such as Plymouth (32 per cent), Stoke (31 per cent), Hull (24 per cent) and Sunderland (18 per cent) ¨C with relatively low numbers of high-skilled knowledge jobs in the private sector.

¡°Many universities may be small in national terms, but they are central to their local economies, particularly outside the UK¡¯s strongest cities,¡± added Carter.

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¡°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. National reforms that weaken the sector risk cutting across the government¡¯s ambitions for delivering growth everywhere.¡±

The report also highlighted universities¡¯ role as ¡°nurseries¡± for innovative activity. Most university spin-outs come from a handful of cities ¨C the golden triangle of London, Oxford and Cambridge.

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Authors warned that big cities outside London ¡°do not pull their weight¡± in the innovation economy, which is a hindrance to the national economy.

patrick.jack@timeshighereducation.com