Will Australian policymakers ever accept that we have an overreliance on foreign students? There’s an awful lot of money riding on us perpetuating a system that leads to exploitation of young people from other countries, a more vulnerable higher education system and demands on an already over-burdened housing and infrastructure sector.
The latest Grattan Institute report from Brendan Coates’ team details the growing problems around temporary graduate visa holders who struggle to find work, tend to earn well below local-born graduates in low-skilled jobs, and look to cheap vocational education courses to extend their stay in Australia. The broader backdrop is of a record number of foreign students — more than 650,000 — in Australia, with numbers per capita a multiple of countries such as Canada, the UK and the US.
The large number of foreign students benefits three distinct groups.
As the report shows, foreign students pay billions — $10 billion in 2019 — to universities via tuition fees, making up more than a quarter of university revenue and, by one estimate, 35%-40% of research funding. While the direct beneficiaries are universities, the greater beneficiary is the federal government: under both sides of politics, universities have been starved of public funding, which remained static in real terms over the course of the 2010s, before the pandemic and tensions with China exposed how fragile our reliance on foreign students could really be.
Business is the bigger beneficiary: the bulk of the $40 billion-plus in exports generated by higher education is through goods and services sold to foreign students while here. The real benefit, however, is hundreds of thousands of younger people with, usually, lower English language skills than Australian-born workers and a more limited understanding of legal protections.
Despite limitations on the amount of work they can legally undertake a week, foreign students have long been a source of easily exploitable labour for business in low-skilled, low-paid sectors such as hospitality and retail.
Given the reliance of Australian businesses on wage theft in recent years, foreign students, along with other temporary visa holders, have thus been an important element in the basic business model of contemporary Australian capitalism. The longer-term cost to Australian business that this exploitation produces is too nebulous to calculate. How many foreign students return home alienated by their experience in Australia, with an entrenched dislike of Australian business?
The third, more indirect but nonetheless important beneficiaries are property owners and investors, whose assets have gained in value as a result of the additional population pressure applied by hundreds of thousands of foreign students — although, as Cameron Murray has noted, more than 100,000 “beds” for foreign students are not counted in housing statistics.
Property investors, in particular, have benefited from the upward pressure exerted on rental prices in areas near universities — just one of the many ways in which older generations in Australia are able to prosper off the backs of younger people courtesy of policy settings that have proved resistant to reform.
As Coates and his team report, not only is the number of foreign students at a record level, but the Albanese government has recently expanded post-study work rights for student visa holders, while the 200,000 temporary graduate visa holders in Australia is more than double the number in 2019, and may increase to more than 350,000 in the next six years.
This means further pressure on housing and capital city infrastructure beyond the “housing crisis” levels that preoccupy policymakers — at least to a degree, if not enough to address politically unpalatable reforms such as negative gearing. However, it’s good news for business and for older housing asset owners, whose interests are still of central concern to politicians.
The Grattan team wants, among other reforms, a concerted effort from the federal government to educate international graduates about their work rights, as well as the sensible reform recommended in a previous report about abolishing category-based temporary work visas with an open system for jobs paying more than $85,000 a year. It also suggests opening up public service graduate positions to foreign graduates, which might reduce the number of foreign graduates forced into low-skill jobs by their inability to find positions in their field of expertise.
But anything that might reduce our reliance on what is regarded as an endless source of free money and cheap labour looks unlikely.
The other aspect rarely mentioned BK, is ethics of poaching educated people from poorer countries.
No, that presume citizens of other nations have no independent agency and/or will remain in Oz permanently; there is massive and mobile middle class emerging offshore who will exercise their choice, probably not Oz…..
As the other poster mentioned these people have their agency.
What about the ethics of denying other people opportunities you had?
Good to see Crikey is finally admitting what economists (and various commentators here) have known for decades. That quantitative peopling via mass immigration is a class issue, as it’s the biggest driver of inequality. So no more hand wringing from the Left now, we can actually agree that we need to reduce migration in order to help ease pressure on housing, infrastructure and services – not to mention the environment?
We need to cut the big business junkies off from their fix of exploited, cheap labour and reduce NOM to 80-100Kpa. Raise the TSMIT to $91K as per the ACTU’s recommendation.
“…quantitative peopling via mass immigration is a class issue, as it’s the biggest driver of inequality.”
As some rapper would say…”true dat”.
The left in Australia, comfortably upper middle class, don’t give a damn about poverty or inequality.
At least the neoliberals don’t bother pretending.
Progressives meanwhile are too busy engaging in moral posturing over open borders as a way to right the inherent injustices brought about by nationality.
If you’re young, poor and a local you ain’t on their radar.
Props to the Greens for being the biggest hypocrites of the lot in this regard.
Some feat.
What’s really interesting (at least for me), is that a lot of scientists I know who have decades of experience, published hundreds of papers, are Professors in their field are raging lefties. They’re up there fighting the class war, wanting progressive taxation, protection of the environment, end to the burning of fossil fuels. But they, their knowledge and experience get sidelined because these scientists say the one thing that the faux lefties in the elite and media (aren’t they same now?) classes don’t like to hear – population pumping through mass immigration is bad. It’s bad for the environment, wages, housing, etc.
If the Greens say “follow the science” then follow the State of the Environment report and reduce the population Ponzi scheme now.
“Population pumping”?
Where are these terms coming from?
A population of people is not good, bad or indifferent. It’s just people. You can’t do anything about people. They exist.
It’s not part of some big conspiracy that convinces:
– people in some countries to have fewer babies and live longer;
– people in other countries to have more babies;
– the people in those other countries to move here,
especially when you can achieve the exact same result setting up a property fund to invest in Australian real estate!
And do you know what the best way of reducing the number of babies in the world?
Through migration.
Generally when people leave their villages and countries they have fewer babies.
See the Irish.
The truth is that people like you can’t accept the reality of living in the 21st century with a 21st century population so reach for some nonsense conspiracy theory.
Please go read the State of the Environment report.
If the State of the Environment report says we need to reduce the number of people in the world then I think we have real problems!
It comes direct from the Anglo eugenics movement, and talking points used as proxy white Oz promotion inc. ‘sustainable population’, from fossil fueled ZPG.
The fulcrum, sharing donors with Kochs (= IPA) in the US, is the network of dec. white nationalist John ‘passive eugenics’ Tanton. admired white Oz, visited, hosted by ZPG related NGO, later informed GOP and Trump administration on refugees & border security, immigration & restrictions and population control.
‘Eugenics, Border Wars & Population Control: The Tanton Network’ (22 Aug ’22)….The increasingly blatant bigotry in immigration discourse is the culmination of decades of targeted influence by an assortment of largely unknown groups known as the Tanton network.
The Tanton network is, as its name suggests, a criss-crossing mesh of politicians, lobbyists, think tanks, non-governmental organizations, pundits legitimized by op-eds in major newspapers, and billionaire money.’
https://unicornriot.ninja/2022/eugenics-border-wars-population-control-the-tanton-network/
What Left are you referring to? I reckon you are a TROLL.
‘The left in Australia, comfortably upper middle class’? Orwellian doublespeak?
“ That quantitative peopling via mass immigration ”???
These “peopling” are people not cattle that get shipped around the world at the whim of some property developer.
And how come property developers and owners like Trump and certain media barons are the ones pushing the anti-immigrant rhetoric?
Is it maybe because it’s a distraction from the real cause of the problems driving housing costs and pressures on other resources – unrestrained capitalism?
As was shown by the Covid lockdown when property prices increased at record levels, it’s the movement of capital not people that is driving housing costs.
There’s enough homes for the current population of Australia without adding any supply. The issue is that a small group own multiple properties.
Possibly for racists reasons.
Quantitative peopling IS unrestrained capitalism. It’s the tool of choice by big business to push down wages (weaken the labour market), boost asset prices, increase GDP, etc. However it results in poorer outcomes for ordinary people and workers as it leads to a degraded environment, increased congestion, reduced quality of life, decreases GDP per capita, etc.
The problem isn’t migration it’s the RATE of migration. Migrants have become tools by big business and the faux education lobby which is why we have skilled migrants driving Ubers because they can’t get a job in their actual profession.
Quantitative peopling is unjust for migrants as well.
That’s because the Libs propped up the markets with $40 billion of taxpayer money coupled with new zero interest rates to keep the game going long enough for the borders to reopen.
“Quantitative peopling” is not a real thing.
People are not money that can quantitatively ease.
It’s got nothing whatsoever to do with capitalism. The reverse in fact. The more a society embraces capitalism the less babies it tends to have.
You’re just making stuff up.
Why would a business need to import people when it can simply offshore, outsource, automate or do more with less?
Why would a property developer need to import people when it can simply keep moving around assets and taking advantage of the numerous financial incentives for flipping properties?
Migrants are not tools. They’re people.
You’re just dehumanising people to justify some made up conspiracy theory that’s not that far from the Great Replacement theory.
I agree. Which is why I’m against the economic system that has made them tools.
I want economic justice for migrants and Australians. The current migration system does not allow for this. So let’s fix it. However, we cannot fix it unless we recognise the way the system has been designed.
You’re the only person saying they are.
What property developers in Australia are “pushing anti-immigrant rhetoric” ? What “media barons” were pushing anti-immigrant rhetoric before Labor were in Government ?
As you’ve noted previous, can’t have inflation without a supply shortage.
Supply-siding people (without any sort of strategy to deal with the consequences) is a pretty good example of “unrestrained capitalism” – privatise the gains, socialise the costs.
During COVID, (some) people were given more money (in some cases, specifically to purchase property) and more mobility (via WFH). They responded by moving out of shared living situations (visible in the reduced household size) and purchasing property. Which – because there’s a fundamental underlying shortage – drove up prices. New supply also dropped significantly during this period (and fortunately, so did external demand).
Funny that the bloke complaining about “people” being treated as “numbers” is… saying the solution is to treat people as numbers.
The population of Australia has, for the last decade, grown every year by a bit less than the size of Canberra on average, and the forward trend looks similar. That means (at least) a Canberra’s worth of housing, roads, utilities, schools, hospitals, shops, power generation, etc, etc, etc, also needs be built every year to support them.
It’s not. It’s an issue – sorta – but not the issue. How is multiple property ownership – the vast majority of which are available for rent – responsible for a widespread housing shortage ? How would eliminating it made a difference, other than turning renters into homeowners (and what impact would the higher incidence of shared housing amongst renters have) ? What difference would it make if the same number of investment properties were spread out over enough people to only have one each ?
This nonsense again.
If a continent the size of Australia with a population of just 25m people manages to end up with some of/the most expensive houses on the planet that points to a massive failing of housing policy driven by some of the worst building standards on the planet, some of the most generous negative gearing on the planet, zero inheritance tax, some of the worst rental laws on the planet, reckless lending from banks, and a farcical auction system (auctions are banned in many countries including the Socialist Republic of Texas).
But instead of blaming such an embarrassingly terrible system lets blame immigrants (sorry immigration if an immigrant gets beaten it’s not your fault).
The size of the continent is not really relevant. Everyone in the country could live quite comfortably (eg: detached houses on 1/4 acre blocks) in less than half of Tasmania.
The very average building quality – particularly since the bubble inflated, and especially in apartments – is also not especially relevant, other than perhaps meaning construction rates are higher than they might be if housing were higher quality.
Most of the other things you mention aren’t wrong, but also aren’t really influential on supply.
The size of the existing population is relevant, as for hopefully obvious reasons it influences how fast new housing and infrastructure can be built. As I’ve already said numerous times, Australia builds a lot. More than most countries per capita.
But the point you keep studiously avoiding, is that Australia does not build enough to supply ~300-400k more people per year, in addition to maintenance and replacement of existing structures. Indeed, given the shortage was already apparent in some areas even before immigration ramped up in the mid-’00s, it’s questionable if Australia could even build enough to handle half that rate sustainably.
It is a mystery why you think the demand side of the supply/demand equation does not apply to housing. Though, to be fair, you are certainly not alone in this strange belief.
Weird how you steadfastly insist that “every option must be on the table, regardless” when it comes to electricity generation, but steadfastly refuse to even consider the main driver of housing demand when it comes to addressing the housing shortage.
Plausible opinions, but where is the impact of changing demographic trends in the long term?
What is the impact of ageing and decline in the permanent population working age cohort on housing, employment, budgets and social services as the mother lode of demographic change happens with baby boomer ‘bomb’ in two decade retirement transition, then in several years ‘the big die off’; may lead to the population pyramid returning to the norm by mid century…..ex. quite a few skips….
Well, you’re the one insisting places like Japan are burning wastelands due to population reduction, maybe you could actually offer some evidence to support your opinion that moderating immigration to match population-related metrics and refining it to match stated objectives would be so disastrous.
Popular populist and nihilistic language of the eugenics movement which was also reflected in local research literature in the ’80s on international education and international students, who feature as numbers and described as an export ‘commodity’…….
No, it masks generational divisions in the more significant permanent population base, aside from modest permanent migration it’s local i.e. boomers vs. GenX & millennials; Australians fall too easily for lazy nativism blaming foreigners or immigrants while ignoring the main game and grounded analysis of actual issues in e.g. property.
FT 5 Oct ’23:
‘Millennials and boomers are competing for homes. Guess who’s winning? Rising prices, high rates and demographics are reversing millennial gains…. Even if prices stabilise and interest rates decline, millennials will find it harder to continue to make inroads into home ownership. That’s because a major demographic shift underlying the tight housing market — increasing competition for homes from ageing boomers — won’t recede for years’
The cognitive dissonance of saying property is an “actual issue” while insisting ~300-400k more people ever year have no impact on it (despite construction being at best about 120k net new dwellings per year) is deadset breathtaking.
Basic maths….
Yes. Basic maths says it’s not enough.
Recall the “Columbo Plan”. Australia once apon a time trained over-seas young people so they could return with their learnt skills to better the quality of life in their homeland. Now we pillage/poach shamelessly nurses& nursing aids from poor countries. Clelia.
“The Grattan team wants, among other reforms, a concerted effort from the federal government to educate international graduates about their work rights,…”
Ha!! Pull the other one! International students, even graduates, don’t have the same rights. None of them do. No migrant here has the same rights as a citizen until they achieve PR (Permanent Residency) status. Because of they were to tell the authorities of their trials and tribulations working for a dodgy employer, that said employer will sack them, cancel their shifts, make up some story about their less than impressive work performance, report them for working illegally or INXS of allotted work hours for a student. Hell! They do this to even citizens like myself. Or did do 30 odd year until I got a job with the Public Service. What chance does a migrant have in all honesty? They want to do the same path as me – a resident and citizen. Not all of them will make it.
The entire migration system is flawed and any mealy-mouthed clap trap from the likes of (hands-on!) Grattan is just tinkering around at the edges. We have too many service industries here. God knows I don’t use ’em. But we have bugger-all businesses who make anything. I want to buy a shirt made here but there isn’t any. I wanted to buy a car during the pandemic but I would have had to wait a year so bought one off the showroom and had to go to Wollongong to get it. Fat chance of buying Australian. The number of times I have had food delivered to my house in 25 years you can count on the fingers of one hand. I blame people. Want everything fast, now and hopefully cheap – all of which is not necessarily Good.
Most of which is paid for using money earned locally and therefore not actually an “export”.
Shh-not too loud.
The 40 billion dollar export lie won’t lie down without a fight.
Got a source on that? It maybe partly true, but often exaggerated while ignoring many students who do not work then family who are guardians, or with friends visit and stay; broader aggregate services demand and tax payments.
If students and backpackers were precluded from employment, our working age cohort and tax base trends would become challenged in the short term, but worse, ‘unsustainable’ in the long term as permanent working age is in decline….
Analysis here:
https://www.fresheconomicthinking.com/p/australias-40-billion-of-education
It’s just fantasy based on bad assumptions.
Hilarious that you question it, then in literally the next sentence insist that students must work, ‘or else’.
It’s clear that the main point of the “foreign education” system is to create yet another pool of low-cost, easily exploited labour.
How about a precis, but then again….. written by Cameron Murray, sure, channeling MB, van O and ‘Australia’s best demographer’ linked to Tanton Network and informing RW MSM?
“It’s just fantasy based on bad assumptions.”