Foreign students have begun to shun the United States

In a potential threat to future U.S. innovation, new international enrollment at U.S. colleges is down for the first time in more than a decade, according to a new report. It is the first hard sign that the Trump administration's rhetoric may be frightening away some of the world's best and brightest who traditionally have been drawn to settle and work in the U.S.

Why it matters: "The Chinese whiz kid, if he can find a way to America, he'll come here. If you're good, you can make a lot of money," Anthony Carnevale, director of Georgetown University's Center on Education and the Workforce, tells Axios. "That whole set of incentives has always been tied to the immigrant stream, and we're severing that connection."

By the numbers: The findings are from the Institute of International Education's annual Open Doors report and its smaller joint "snapshot" report on international enrollment. It found that new international student enrollment dropped by 3.3% for the 2016-2017 academic year, and by a far higher 6.9% in the Fall 2017 semester. Peggy Blumenthal, IIE's Senior Counselor to the President, told Axios that it was the first time the organization had seen a drop in the 12 years it had been collecting this data.

"We don't grow talent in America," Carnevale said. "We go out and harvest talent from the rest of the world. We're basically taking ourselves out of the game." He said that global politics are accentuating the trend. ""Opportunity for talented STEM workers is increasing in the rest of the world — the two together: the rise of the authoritarian personality here and the increasing prospects for people in their own countries as the whole world turns to capitalism."

Worth noting: Blumenthal said the trend is affecting big-name schools much less than the average, especially on the coasts. The effect was much more pronounced in the Midwest and Texas, she said, especially at schools without Ph.D. programs, and at community colleges. She said, "It's happening state-by-state and institution-by-institution."

Foreign students already in the U.S. are worried: After foreign students graduate, they can stay in the U.S. for a year under the Optional Practical Training (OPT) program, and up to three years for STEM fields. A lot of OPT students hope to parlay more time in the U.S. into a highly skilled H1-B visa, and their numbers have jumped by double digits each of the last five years, with year-over-year increases of 19.1% last year and 22.6% in 2015.

• What worries foreign grads is that OPT exists under an extension granted in an executive order by Barack Obama. President Trump has not mentioned OPT, but he could unilaterally wipe it off the books as part an immigration reform package. The Urban Institute's Daniel Kuehn tells Axios, "Clamping down on OPT would restrict the smooth flow of students from American schools to American companies. … It's something that could be very disruptive, and that would be a way to throw a monkey wrench into navigating U.S. immigration."