The students are hired to do maintenance in the Aqueducts. Due to the Planner going crazy and murdering many of them, along with Fixers suddenly shooting the Students on site, the Students have been traumatized to the point of cowering in corners and running at the first sign of trouble. They will never attack unless provoked first, at which point they'll take out a pistol and start firing. They can easily be sneaked up on and killed with a single shot. Some will drop valuable ammunition, which can be put to good use against stronger enemies later.
Killing Students has an effect on the outcome of the game. If no Students are killed, a boss fight can be completely avoided, whereas an extra boss fight will take place if even one Student has been killed.