In the last four years alone, the number of Chinese students studying in Britain has risen by 36%, more than three times the 11% rate of growth for domestic students.

This means that more Chinese students travelled to study in the UK last year than from the entirety of the Commonwealth or from the rest of the G7. Indeed, fewer full-time places on UK campuses went to young people from the East Midlands or Yorkshire and the Humber than from the People’s Republic of China. Among postgraduates, this concentration is starker: for every two and a half UK postgrads, there is now one Chinese postgraduate studying in Britain.

Given the financial dependence of universities on Chinese students, then, the increasingly menacing language coming from Beijing should worry vice-chancellors deeply, especially at a time when they face a Covid-related financial squeeze. Beijing has threatened “devastating consequences” in response to recent decisions on Huawei and Hong Kong. If those consequences are targeted at UK university campuses, as is happening increasingly in Australia, they will have profound consequences for this country’s students, taxpayers and competitiveness. 

With rising tensions over Hong Kong, it is no coincidence that the Chinese Ambassador, Liu Xiaoming, chose this month to remind Chinese students in Britain of their national duty. “Leverage your strength to extend the reach of China’s stories”, he told them, “serve your motherland”. Amid deterioriating relations with the West, he was sending a message that Beijing sees students not as free consumers of education exports but as propagandists and geopolitical pawns.

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If China instructs its students to boycott Britain, it is almost certain that several institutions would fall over. New Onward research estimates that up to 16 universities rely on Chinese students for more than a fifth of their total fee income. The list includes many of the most prestigious and research-intensive institutions, including University College London, Imperial, Sheffield and Manchester, many of whom are already over-extended with debt and facing lower student flows due to the pandemic.

Because of the way overseas students cross-subsidise research, a fall-off in Chinese demand would also severely undermine UK science. Universities make an average surplus of £5,100 for every overseas student, of which £4,000 typically goes towards research. In total, overseas student fees contribute to a third of university research funding, meaning £1 in every £9 spent on university-led research in the UK relies on Chinese student income.

A further risk relates not to people but to influence. Unlike the United States, the UK has no formal controls on the foreign state funding of scientific research. In recent months, Jesus College Cambridge, Imperial College London and the London School of Economics have faced criticism after Freedom of Information requests revealed they had accepted funding from Huawei. But the reality is that no one — not even universities themselves — knows how much research funding comes from the Chinese state or its subsidiaries. Programmes like the Thousand Talents Plan, for example, are highly secretive.

If it seems extraordinary how much of this country’s research base depends on beneficence in Beijing, it is even more striking how few people recognised this as a strategic risk before the pandemic. In recent decades, the overwhelming consensus has been that higher levels of overseas students, especially from a growing Chinese middle class, are an unalloyed good that brings talent and money to Britain’s centres of learning. Politicians have gone out of their way to boost the concentration of students from China; Xi Jinping even began his 2015 state visit with a tour of Manchester University at the personal request of George Osborne.

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The risks of overreliance on a single market — let alone an authoritarian country whose interests are diverging from our own — has never been debated. When I raised concerns about China’s dominance of student places in January, several liberal Twitter users scoffed. “Germany exports physical capital to China in the form of machine tools”, I was told, “the UK exports human capital in the form of education.” But universities are cultural and scientific institutions, not factories, and the collateral damage from a Chinese boycott of British universities would be far worse than similar action against German industrial machinery.

University places are also unlike other products because some institutions artificially constrain their supply, displacing lower-paying UK students. Oxford and Cambridge, for example, cap their student numbers, meaning there has been a decline in the number of state school pupils winning places in the last 20 years while the number of international students has sharply risen. Between 2014/15 and 2018/19, the number of UK students fell at Oxford, Cambridge, Imperial, UCL, LSE, Bath and Manchester, and flatlined at KCL and Durham. Even if overseas students have subsidised domestic growth in aggregate, at the best institutions it seems to have crowded them out.

This is a debate the UK needs to have without delay. In the last six months, the Chinese state has issued escalating threats of a student boycott of Australia in response to security laws and trade tensions, culminating in June with the Chinese Ministry for Education telling students to “exercise caution” before choosing to study there. Australian universities will lose an estimated £6.5 billion over the next two years if the warning is heeded. Chinese mainlanders are already banned from studying in Taiwan.

These moves have already prompted Canada to start diversifying their overseas student intake. The UK should urgently do the same. One simple way to do this, without throwing the baby out with the bathwater, would be to cap the number of students from any one country attending any single institution. This may be hard for some institutions in the short term, but in the long-run would have two virtuous effects: it would force universities to recruit more widely from overseas, diversifying the student body and improving resilience, and it could even spread the income from overseas students from the top universities down.

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At the same time, ministers should make the expansion of overseas students contingent on growing the number of high-quality places for domestic students. We can hardly wonder why graduates feel dissatisfied with university, and gain ever less economic value from it, if the most prestigious courses and institutions are increasingly reserved for students from overseas.

Finally, universities should make much more transparent the funding that their academics receive from foreign bodies or governments. This is not in any way to say that international funding should be discouraged: research collaboration and exchange are essential to innovation. But we should accept that British taxpayers have a right to know — and to scrutinise — who is contributing to research at UK institutions, and what benefit they may be gleaning in terms of intellectual property, commercial partnerships or data.

The suspension of international travel from coronavirus has exposed the scale of universities’ reliance on overseas students. But the strategic risks existed before, and will persist long after, a vaccine has been developed. Politicians need to ask themselves a very simple question: are they comfortable with the fate of universities or the level of science funding being decided in Beijing rather than Westminster? If not, we must decouple and diversify.

Over and over, I felt the slow-motion gutpunch of realisation that an employer was never going to respond. Like many, I worked for free, drawing on savings from summer and university jobs from the previous year, to get my foot on a career ladder that wasn’t my first choice.

It hadn’t been until September 2009, 12 long months after Lehman Brothers’ collapse, that Gordon Brown announced his plan for youth unemployment. By that point, the damage had already been done. In the intervening year, youth unemployment rose at four times the average rate, putting an extra 157,000 18-24 year olds out of a job and leaving more than a quarter of a million unemployed for six months or more.

I was lucky, as it turned out. I caught a break, never suffered long-term unemployment and eventually found a career path that has been good to me. But for many of my contemporaries that career start took a toll that endured for many years. According to work by the Resolution Foundation, the generation that entered the labour market alongside me between 2008-11 took six years to make up their lost wages and graduates were 30% more likely to work in low wage jobs than students who left university before or after them.

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Even worse effects were experienced after previous downturns. The cohort that entered the labour market during the mass unemployment of the early 1980s were earning between 13 and 21% less, on average, two decades later. A study of school leavers in the Netherlands in the 1990s found that delaying their entry into the job market by a year reduced their likelihood of finding a job in the following two years from 60% to 16% for men, and from 47% to 13% for women.

We cannot afford to be as lethargic about youth unemployment this time. As the latest ONS figures show, coronavirus may kill fewer young people than previous pandemics (peak mortality during the Spanish Flu was among 28-year-olds) but it has greater potential to sentence them to a life of lower earnings, worse jobs and weaker productivity. The downturn we are entering will be deeper than any other in living memory, and it may also be longer lasting. We must avoid long-term unemployment becoming a rite of passage for a generation.

This will be harder than it sounds. Young people are typically the most vulnerable in recessions because they are most expendable. As existing jobs are lost and new openings become scarce, newly minted youngsters are usually first to be fired and last to be hired. The thinning of the labour market means young people are forced to compete with people with years of experience. Their ambitions and dreams can disintegrate and the skills they built up can fade as time goes on. These effects will already be being felt by the many young people on furlough.

The priority for the Government should be to keep as many young people in work as possible, and to bounce them back into work as quickly as possible when they fall out. The extension of the furlough scheme will help to achieve the first of these objectives, at least for now. But very soon ministers will have to consider options that were previously unthinkable to salvage a generation — and protect the future economy.

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Put bluntly, we will need to start paying employers and institutions to keep young people in work and study. That is a sentence to make fiscal conservatives and economic liberals baulk. But in case you have not noticed we are not in normal times and the normal rules do not apply.

Evidence from other countries provides some evidence of the effectiveness of limited, targeted wage subsidies. A recent evaluation of France’s policy of small business hiring credits for low-wage workers, introduced just three months after the fall of Lehman Brothers in December 2008, found that it had strong and immediate employment effects. Another study of Sweden’s Anställningsstöd employment subsidy programme, which supports up to 85% of wages for underemployed workers, found that firms that hired through the scheme grew quicker than counterparts that did not.

A less expensive option would be for the Treasury to waive employers’ National Insurance contributions for younger workers. Saving these frictional costs will not generate thousands of new jobs but it might shift the balance in favour of younger workers for existing posts. In the current environment, when youth unemployment is surging ever higher, the usual protests about the deadweight costs are less salient. Whatever its form, some kind of Coronavirus Youth Job Retention Scheme will be needed to keep young people in work long after the furlough scheme is over.

But in a severely dampened economy, jobs and wages are always going to have limited reach; there will simply be fewer jobs around. So ministers should consider keeping some young people in education for an extra year. It is little unremarked upon, but it costs the taxpayer marginally less — around £4,000 a year — to support an 18-year-old in college than it does to support them on the basic Universal Credit allowance for a year. These costs fall even more if the effects of lower long-term unemployment on productivity and earnings are taken into account.

Some young people may not want to — in which case we should not force them — but many might want to learn. Given the hammer blow dealt to university finances by plummeting international student numbers, there is a strong case for asking the best institutions to develop cheap one-year courses to upskill the coronavirus generation. It would be an elegant way for the Government, which has rightly resisted a sector-wide bailout, to support the best institutions through the next few years.

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For those of less academic persuasion, this is the moment that apprenticeships should come into their own. One of the virtues of the Conservatives’ apprenticeship reforms is that every firm in the country now has access to a pot of money they can draw upon to fund apprentices, funded from a levy on the biggest employers. These pots could be topped up, co-payments by small businesses could be suspended, or golden handshakes introduced to encourage more firms to hire school leavers as apprentices and put them on a technical path to skilled employment.

Even before this crisis, younger generations had a bad lot. Unlike previous generations, today’s graduates leave university saddled with debt and with marginal tax rates of up to 51%. The pension they receive will be smaller, but they will have to work for longer and contribute more to receive it. The things that previous generations took for granted — a home, a secure job, the ability to settle down and start a family — are harder won and later found, if at all.

As the country begins to emerge from lockdown, where the focus has inevitably and rightly been on the mortality rates of older generations, the focus must swing quickly to the effect on young people. Leaving school or graduating from university is meant to be a wonderful time of adventure and exploration. The unlucky Class of 2020 face heartbreak and listlessness. The scars they will bear from this disease may not generally be visible or medical, but they will last a lifetime unless something is done right now.

Britain needs a social stimulus to match the economic guarantee. The rationale for the former differs from the latter. In the economy, policymakers have acted to prevent a temporary supply shock from transmuting into a permanent cutback in demand. Levers and political willpower we never knew existed have been deployed at unprecedented scale and dizzying pace to this end.

In society, communities are fast experiencing the equal and opposite problem: a temporary explosion in demand after a long period during which the supply of connection and neighbourliness has been in abeyance. Yet there has been no talk of a package to respond to this demand, and to strengthen fragile and anxious communities.

True, the past week has seen countless stories of altruism — mutual aid groups, supermarket elderly hours, key worker discounts and neighbourly altruism. With every story, it is impossible not to have your faith in basic humanity and the power of community bolstered. But for every small act of kindness, there are countless civic institutions and community groups whose vital work is hanging in the balance just when it is most urgent.

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Homeless shelters are bracing themselves for closure when their vulnerable populations inevitably fall victim to infection; one shelter in Glasgow has already shut its doors. Stockpiling has emptied supermarket shelves and foreclosed food banks too, leaving families hungry. Community businesses, which rely on venue-based activities such as shops and cafes for 43% of their income, are particularly vulnerable to the prolonged lockdown announced by the Prime Minister on Monday.

Worryingly, new analysis from the Centre for Social Justice reveals that a quarter of all charities with incomes below £1 million have no reserves at all. Newspaper reports suggest donations to UK charities have almost halved in the last month. Even before public restrictions, four in five charities were warning that Covid-19 meant they would probably be unable to operate normal services. There is a real risk that social distancing may destroy social enterprise.

And this ignores the existing deeper frailties in our social fabric. Londoners baulk at the darkened shops that now adorn our streets, but an empty town centre was a familiar sight in many regional towns and suburbs long before the pandemic hit. It is a depressing truth that many of those places will see their last high street shop close for good during the next few months. Without help, the lifeblood of many Northern towns — the local football, rugby league or cricket teams — will go to the wall, unable even to see out their final season.

We cannot let this happen. We must use this moment to replenish the stock of social capital that had been left to atrophy over generations — precisely because it is this social fabric that will sustain society through the coming months of strain and heartbreak. Besides, the state will be overwhelmed without help from communities.

The Prime Minister and Robert Jenrick have already announced plans to use the military, local government and volunteers to direct food and supplies to 1.5 million vulnerable people quarantined for three months. But the number of over-65s living alone far exceeds this — 3.8 million people, equivalent to 6% of the population or a thousand people for every Intensive Care Unit bed in the NHS. Who will deliver food and supplies for those not covered by the Government’s initiative? This is when our social infrastructure comes in to its own.

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The NHS is creaking under the weight of 6,500 infections — a tenth of the number witnessed in Italy — even before widespread testing has begun. The health service will need to fall back on some of Britain’s three million first aiders, 15,000 St John’s Ambulance volunteers, and countless voluntary hospices and trusts located around the country to test and care in the community if it is to defeat the disease.

Similarly, who will care for Britain’s elderly, if not Britain’s seven million informal and family carers, when care homes close and hospitals are filled beyond capacity? How will local government cope, without the rich web of informal social services — from foster parents and crisis cafes to community benefit societies and youth clubs — needed to divert demand, maintain order and sustain morale during what will arguably be the greatest crisis this generation has faced? Even during the next three months of lockdown, these groups can be deployed digitally to help vulnerable groups.

The Government has already taken steps to strengthen these little platoons. The extension of the business interruption loan scheme and salary guarantee to charities and social enterprises will keep existing charities on life support for three months. Baroness Barran, the civil society minister, and Oliver Dowden, the Culture Secretary, are clearly working hard to buttress civil society.

But there is an opportunity to go further, to strengthen and scale existing efforts and help new initiatives prevent the virus laying waste to communities.

This will require funding, but money exists, if the will is there to unlock it. The 380 members of the Association of Charitable Funders (ACF), for example, have £50 billion under management: a 5% pay-down would release £2.5 billion to charities and community groups right now. That is even without the kind of resources the Treasury is deploying to shore up other sectors.

It will require flexibility around staffing, governance or vetting red tape, to ensure help is expedited to those that need it.

Could we not temporarily relax regulations limiting childminders to six children, for example, if doing so releases key workers to tend to the sick? Should we not drastically reduce the time it takes to register a charity from the current 40 day minimum, or slash the waiting time for an enhanced DBS check — needed to work with people in receipt of healthcare — from the current four weeks? Radical tax incentives could also quickly be introduced to encourage more people to donate to good causes during the next three months.

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In addition, the Government should not hesitate in safeguarding social institutions in the same way it has rightly underwritten the future of economic assets. The long-term damage from this disease will be considerably more pernicious if local fans do not have match day and regulars do not have their local cafe or pub to come together around when the disease ebbs.

Last week, Rishi Sunak said “We want to look back on this time and remember how we thought first of others and acted with decency.” He was right: it is how we act together and the things we do for each other that will define this moment in history.

It took the new Chancellor 10 days to go from a £12 billion Budget to guaranteeing the wages of a tenth of the workforce. He and the Cabinet should work with the same speed and scale on the social response. Onward, the think tank I run, will be working at pace to help them.

We may now be in splendid isolation, but that must not prevent connection. And unless we act fast, the casualties of this pandemic will not just be measured in terms of GDP shed or lives lost, but in a society whose foundations are weaker, its institutions withered, and its resilience to handle future challenges reduced.