The Department of Homeland Security and U.S. Citizenship and Immigration Services confirmed a historic downturn in foreign student enrollment as policy changes tighten the rules for student visas and schools brace for widening deficits.
DHS and USCIS data, along with early SEVIS analysis, show a 17% plunge in new international student enrollment for the Fall 2025/2026 academic year, the largest non-pandemic decline in more than a decade.
Universities that rely on full-tuition international students to subsidize domestic education and research are reporting sharp drops, particularly among graduate entrants, pushing more institutions toward spending cuts and deficit budgets.
Driving policy changes
The foreign student downturn is being driven by a series of restrictive policy changes, including a proposed end to “Duration of Status” (D/S) and new enrollment caps tied to federal funding.
- Proposed end to Duration of Status (D/S) and replacement with a fixed four-year stay for F-1 and J-1 visa holders, with extensions requiring an Extension of Stay application to USCIS.
- New enrollment caps proposed as conditions for federal funding: a 15% cap on international undergraduate enrollment and a 5% limit on students from any single country.
- Expanded entry restrictions via a Presidential Proclamation effective January 1, 2026, adding countries to entry limitations.
- A finalized DHS rule (December 23, 2025) prioritizing H-1B visas by salary — a weighted lottery that favors higher-paying positions.
“For too long, past Administrations have allowed foreign students and other visa holders to remain in the U.S. virtually indefinitely, posing safety risks, costing untold amount of taxpayer dollars, and disadvantaging U.S. citizens. This new proposed rule would end that abuse once and for all by limiting the amount of time certain visa holders are allowed to remain in the U.S., easing the burden on the federal government to properly oversee foreign students and their history,” an official DHS spokesperson said in a press release dated August 27, 2025.
DHS also used the term “forever students” to justify the crackdown:
“In turn, foreign students have taken advantage of U.S. generosity and have become ‘forever’ students, perpetually enrolled in higher education courses to remain in the U.S.,” the DHS press release said.
Timeline of key policy actions and proposals
- August 27, 2025: DHS press release proposing limits on visa duration and describing concerns about “forever students.”
- October 1, 2025: White House 10-point memo, Compact for Academic Excellence in Higher Education, proposed enrollment caps (15% undergraduates; 5% per-country).
- Late 2025 (final rule proposed): Replacement of D/S with a four-year fixed stay for F-1/J-1, expected to take effect mid-2026.
- December 23, 2025: DHS finalized rule to prioritize H-1B visas for high-salary positions (weighted lottery).
- January 1, 2026: Presidential Proclamation expanded entry restrictions to additional countries.
Implications for students
- A fixed four-year stay would require students who need additional time to file an Extension of Stay with USCIS.
- Universities and students warn that a fixed term could create new legal risks if paperwork is delayed or errors occur in processing.
- Minor clerical errors or USCIS processing delays could lead to “unlawful presence,” with consequences including immediate deportation or long-term travel bans.
- The H-1B wage-based weighted lottery reduces selection probability for Level I and II workers by nearly 48%, creating a bottleneck for entry-level graduates.
If your program uses a fixed four-year stay, prep your Extension of Stay early. Gather financial, academic, and passport documents now to avoid processing delays that could risk unlawful presence.
Institutional and economic impacts
- Universities that depend on full‑tuition international students to subsidize domestic education and research are reporting steep declines and budget pressure.
- NAFSA: Association of International Educators projects a $1.1 billion to $7 billion loss to the U.S. economy due to the 2025 enrollment drop.
- Private and mid-tier public universities have been hit hardest.
Notable institutional reports:
– DePaul University: 62% plunge in first‑year international graduate enrollees for Fall 2025, prompting “massive” spending cuts.
– Columbia University and the University of Michigan: Significant dips in graduate enrollment, increasing pressure on budgets that rely on international tuition and research funding.
How the changes affect the admissions-to-employment pipeline
- Admissions: Proposed enrollment caps reduce institutions’ ability to admit international undergraduates regardless of demand.
- Enrollment: The 17% decline in new international students (Fall 2025/2026) is already translating into fewer arrivals and tuition revenue.
- Post-graduation employment: The H-1B weighted lottery prioritizes higher salaries, reducing prospects for entry-level international graduates.
This combined tightening — from admissions caps to shorter stays to restricted entry and H-1B changes — creates a narrower, less predictable pipeline for international students and institutions.
Risks and warnings raised
- Universities warn enrollment caps tied to federal funding could force reductions in international undergraduate admissions even when demand exists.
- Students face planning challenges for multi-year degrees amid policy changes expected mid-2026.
- Fixed-term admission tracking places administrative burden on students and institutions and increases the stakes of processing errors.
- Financial fallout is resulting in staffing, course offering, and research-support decisions as institutions balance reduced revenues.
Processing delays or clerical errors in the new stay limits can trigger unlawful presence and travel bans. Double-check forms, deadlines, and USCIS instructions to minimize risk.
Data sources and reporting
More detailed federal student‑visa trendlines are tracked through SEVIS reporting, including the SEVIS by the Numbers Annual Report (Released June 2025). DHS published its policy rationale in the DHS Press Release: Proposed Rule to End Foreign Student Visa Abuse (August 27, 2025), and USCIS posted information about the H-1B rule in the USCIS Newsroom: H-1B Weighted Lottery Final Rule (December 23, 2025).
Summary: what’s changing and why it matters
- The U.S. is experiencing a historic non-pandemic decline in new international student enrollment (17% for Fall 2025/2026).
- Policy shifts — ending D/S, imposing enrollment caps, expanding entry restrictions, and prioritizing H-1B by wage — are reshaping incentives for international students.
- Institutional budgets, student planning, and the broader economy face significant stress as the traditional model that relied on full‑tuition international students is altered under enforcement-focused policy, funding conditions, and administrative rule changes.
U.S. international student enrollment has dropped by 17%, the largest non-pandemic decline in a decade. New federal policies, including fixed-term visas and enrollment caps tied to funding, are reshaping higher education. These changes aim to eliminate ‘forever students’ but risk causing billions in economic losses. Universities face widening deficits as the traditional pipeline from enrollment to H-1B employment narrows significantly under new restrictive regulations.
