Domestic uni students crowded-out by foreign students

By Leith van Onselen

The Australian Population Research Institute (APRI) has released an update to its November report on overseas students, entitled Australia’s higher education overseas student industry revisited, which analyses the Commonwealth Department of Education’s newly released 2017 student enrolment data, which revealed a “striking further increase in the share of commencing overseas students”.

Below are key extracts:

By 2016 this share [of overseas students] already reached the very high level of 26.7 per cent. Surely, you might think, it can’t go much higher, since at this level it was way above that in Australia’s major competitor countries, the UK and the USA.

However it has. The news is that in 2017 this share increased to 28.9 per cent. In the November report we focussed on the Group of Eight (Go8). This was because in a number of these universities, including the University of Sydney and the University of NSW, this share was almost 40 per cent by 2016. The enrolment data for 2017 shown in Tables 1 and 2 indicates that the Go8 saw much faster increases in overseas student commencements than in the non-Go8 universities. So much so, that by 2017, the share of overseas student commencement to all commencements had reached well over 40 per cent in the University of Sydney, ANU, and the University of NSW.

We do not repeat the reasons why this high reliance on overseas students is a serious source of concern, except to provide a brief summary immediately below. But obviously, if the level of reliance on overseas student enrolments and revenue was an issue with the 2016 enrolments, there are even more grounds for concern given the further sharp increase in 2017.

This report focuses on an issue not explored in the November report. This is the implications of such rapid growth in overseas student commencements for access to higher education on the part of domestic students. The higher education overseas student industry repeatedly claims that there is no conflict between the expansion of overseas student enrolments and domestic opportunity. Yet as we will see, in the case of the Go8, over the five years to 2017, all of the expansion in commencements has gone to overseas students. Domestic enrolments have been static.

This a highly topical matter because in December 2017 the Coalition government announced that it would henceforth cap the level of domestic higher education enrolments. Since that time, Australia’s universities, including the Go8, have mounted an offensive against this decision on the grounds that it limits opportunities for domestic students. Yet the enrolment data examined below indicates that, at least since 2012, the Go8 has effectively enforced just such a cap on domestic enrolments…

The stabilisation of domestic enrolments was not because the Go8 lacked the capacity to increase their student load. They did have the capacity, but all of it has been taken up by increased enrolments from overseas students. As Table 2 shows, there seems to be no abatement in this trend. The Go8 took on 168,985 commencing overseas students in 2017, which represents an 11 per cent increase on the 150,173 enrolled in 2016.

Clearly, the Go8 universities preferred to enrol overseas students. In effect, the benefits of the allegedly superior education that these universities offer went to overseas students rather than to local students. This was not because overseas students had superior potential to take advantage of what the Go8 offers. The contrary is the case. The Go8 do not preference high performing overseas students. There are minimal entry barriers to their enrolment other than the ability to pay the huge fees required…

In the business and commerce faculties at the Go8, where Chinese students often constitute the majority, there is a direct cost to the quality of the education offered. We argued that such courses have had to be made less demanding so that the many Chinese students with relatively limited English language skills can cope with their requirements and assessments…

Australia’s universities, especially the Go8, are caught in a vicious circle as their reliance on overseas student revenue deepens. They are in no position to prioritise teaching which benefits the vocational needs of their domestic students or to focus on research activities relevant to Australian industry or the wellbeing of Australian citizens. They have to focus on research which scores on the international ratings and they have to sustain high enrolments from international students  in order to help finance this research.

It is about time that the Australian government recognised this situation. National, rather than university, priorities should guide higher education policy. Successive governments have allowed the universities’ success in generating revenue, revenue which is counted as export income, to obscure the wider consequences of this activity.

As noted last time, Australia’s universities have become a giant rent-seeking business, just like the superannuation industry.

Rather than clipping the ticket on the deluge of funds coming in via compulsory superannuation, the universities sector instead clips the ticket on the deluge of foreign students arriving in the hope of transitioning to permanent residency.

Instead of focusing on providing a high quality education and upskilling Australia’s population, the universities sector has become focussed on pushing through as many students as possible in order to maximise fees and profit. Again, this has parallels to the superannuation industry, whose focus is on maximising funds under management and fees, rather than achieving strong returns for members.

The end result has been the erosion of standards and too many university graduates chasing too few professional jobs.

About the only winners from Australia’s rent-seeking university system are vice-chancellors, whose pay has already exploded to an average of $1 million on the back of the student explosion, at the same time as university students are stuck paying off expensive and increasingly worthless degrees, taxpayers are stuck writing-off unpayable debts, and the broader population is suffering under the never-ending population crush.

It’s time to put a leash on the university sector, starting with removing the link between foreign students studying at university and gaining work visas and permanent residency. Let our universities compete on quality and value alone.

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Unconventional Economist


  1. The headline is “Domestic uni students crowded-out by foreign students.” However, an increasing percentage of overseas students does not mean that the number of domestic students is being “crowded out” — it just means that there are more overseas students. For instance, before = 100 domestic students + 20 overseas students, after = 110 domestic students + 50 overseas students means a higher percentage of overseas students, but certainly doesn’t mean that the number of local student enrolments has been ‘crowded out’.

    Reality is that number of student places isn’t fixed, so why would more overseas students ‘crowd out’ local ones — the more the merrier for the universities (for both internationals and domestic).

    • Gee Davey, were did you get those numbers from – the IPA?

      eq 1. 100 + 20 = 120

      eq 2. 110 + 50 = 160

      So, in your example, you just increased the initial university/course population (n=120) by 33.3% and you are arguing that this has no impact on domestic students?

      But given that universities have staff:student ratio issues, like any educational institution does, the quality of the course goes down as the number of students goes up unless an investment in increased capacity to deliver has happened well in advance.

      In particular, because there are only so many high quality researchers and teaching staff in any institution (the entire point of a uni education), they become increasingly pressured and spread themselves thinner as the university population increases. More inexperienced staff are then recruited (most often part time). Contact time per student with highly skilled staff reduces proportionally (it is probably not a lineal decline, more like a negative exponential decline). Access to facilities declines and crowding increases in community space (e.g. pools and sporting facilities fill up, line lengths increase, desks in libraries are harder to find etc).

      And there are about a thousand other reasons why increasing the overall pool of students by 33% is effectively crowding domestic students out of a quality education.

      Also, isn’t it interesting that our kids are made to pay full fees for declining services – now where have we seen this before?

      This is like the mass population issue. If you want to increase the population by 33% and keep the same quality of life you will need to increase infrastructure and accept an increased density and a reduced share of amenity. In universities that means increased staff recruitment by far more than 33% because you will need to build skills over time as well as replace buildings, expand libraries, increase department size etc – and do so years in advance. You need to over-invest to ensure that you meet a minimum standard in the future.

      And just like the mass population issue, is this additional expenditure happening?

      No, it’s not. It’s a joke. It’s the same neoliberal race to the bottom that is destroying the quality of education by trying to squeeze the last dollar out of a market until the wheels fall off.

      Education is not an “industry”, it is a social obligation that will determine the quality of our futures. It is key to our survival.

      The Australian university experience for our kids has been destroyed by turning learning into an industry with the same morals as our banks. It’s disgusting and high time that people woke up to the vandalism that both the ALP and LNP have engaged in.

      The ALP will not turn this around – in fact, they began the decline in the Hawke years.

      • Clive, you criticise my figures which are clearly there to illustrate a point, and introduce an IPA strawman.

        You then go on to describe quality staff as a fixed resource rather than something that can be increased. This might/might not be true, keeping in mind people can be recruited and trained. For the record, I’m not saying this latter argument of yours has zero truth in it, rather that you haven’t exactly presented a lot of evidence to substantiate it.

      • Another factor is the perverse way that university rankings are calculated.
        For example, consider a situation where two academics, A and B, are each teaching 2 courses and publishing 5 research papers per year. The University decides to reassign their duties so that A does no teaching at all but publishes 10 papers per year, while B teaches 4 course per year but doesn’t do any research because he is classified as “teaching focused”. The output of the university has not changed at all, but its ranking will improve because the number of papers per “research academic” has increased (only because B is no longer counted as a “research academic”). There is currently pressure for this to happen not only for 1st and 2nd year courses but also for the more advanced 3rd and 4th year courses. The quality of education degrades because students are no longer in contact with active researchers. But, the ranking of the university increases, which is the only thing the Deans and VCs care about. It’s neoliberalism on steroids.

      • “…you criticise my figures which are clearly there to illustrate a point..”

        That point has been well made…possibly not the one you intended to make though.

        “You then go on to describe quality staff as a fixed resource rather than something that can be increased.”

        You better read this again Davey, as it is clearly not what I said is it? BTW, speaking of reading skills; when you increase the student cohort to have a larger number of students who are ESL course delivery is slowed to accommodate.

        As for the other comments you made (that have now been edited out) I’m gobsmacked by your magnificent prophecy and assumptions that my concerns are somehow related to your success etc. I haven’t the foggiest idea who you are and clearly the inverse applies.

    • Semantics, Dave.

      Walk through UNSW. It’s unbelievable. ‘Swamped’ would be a more accurate description.

      • +100
        UNSW is going to be a majority international student university in the not too distant future,
        It is insane what is happening there.

    • Thanks for legitimising this article with your comment, lowering education standards indeed, import more like this guy

      • Thanks for your comment Mark, but if I’m so much more stupid & uneducated than you, I wonder why I earn so much more and have so many more assets than you ever will? Oh well, you can always whinge about expensive housing on a blog.

      • Ohhh Davey Davey Davey… seems to me that
        a). you’re here too
        b). you are searching for that “something” to fill that hole in your heart, make you feel validated
        c). you’re pretty damned quick at making assumptions and casting aspersions

        Therefore – I don’t think you’re different at all, little man. Welcome to “the others”!

        PS: I do grasp the irony of the situation: I too, have made two key assumptions: one about your stature and one about your gender.

      • Oddly enough Ino, what a low-status unsuccessful person like you thinks matters little to me (or anyone). But for the sake of being constructive, I recommend you show some self-discipline and work harder. Some good things might come out of it leading you to be less bitter of others.

      • If it matters so little Davey then why reply? You don’t have enough time to worry about what some of the unwashed think mr successful.

      • @Bzunica

        Leave Davey alone – he’s trying to get away from his name but can’t: he is a self-priming septic tank pump – full of sh*t and named Davey.

      • “…Oddly enough Ino, what a low-status unsuccessful person like you thinks matters little to me (or anyone).”

        Ergh? What’s going on here?

        The mistake I made was to treat ‘Davey’ and his comment seriously without reading his/her other rather interesting contributions. It won’t happen again.

    • I felt crowded out when I was at UNSW – I was the only non-Chinese student in my Finance tutorial, and the tutor (also Chinese) ended up conducting the tutorial in Mandarin, which I could not understand.

      I disliked my time at UNSW, so it really was par for the course, but from a utilitarian perspective I guess it made sense.

  2. yep, are unis r wh0ring themseleves to the highest bidder…they seem yo be made as degree factories for asia’s least brightest who want to get PR

    serious, even elite degrees like med and dentistry are flooded with internationals…as if our own kids dont want to study these elite courses…so we end up with almost half the class in UQ’s case of candians, US students, chinese, malays, and indians/nepalese who are taking the places of our own kids….and they get in under lesser means as well eg lesser gpa’s, anything to get them thru the door…the VC needs his pay packet over 1 mil!

    and the asian students who get in do NOT do the same degree…they are given loads of extra time to account for ‘language’ difficulties….in some cases an extra 30 mins minimum for exams…

    and why are they given work rights at all???? its unlimited work rights in holidays, which means that third world students are packing shelves, working in pizza joints etc …you know the jobs our kids used to do in their holidays

    its almost as though this has been planned….the extermination of young aussies in our own land, we are the second class citizens and have to beg for the crumbs….IMO it all a big conspiracy against western countries by the global and local elite…

    i am more and more thinking i dont want my kids to be a part of this new australia and the place is sinking fast.

      • I’m already wondering whether I should send my daughter overseas to university. Norway provides free education in English and has some ten or twenty thousand international students all up in the country. Australia has 750,000 intl students according to the employment dept website.

      • The solution is to advise your kids to go to the “second tier” universities, some of which are really quite good. Let the Go8 trash their standards and their brands.

      • Why is what a good thing ?

        I’m not sure where you’d get the idea I support the university-as-a-business model from. Usually I’m the one getting criticised for saying universities should be focused on academic pursuits not making people employable.

      • Dan, the second tier ones like Griffith are also swamped. So glad my city said no thanks to Southern Cross.

    • The VC of our universities are getting paid 7 figure salaries to run it like a profit making enterprise, even in reality it is a mostly taxpayer funded education institution.

    • The pizza joint franchises owners, supermarket and fast food shift managers et al are now foreigners and recruit their own.

      Scrap working rights for students and their partners.

      Cut the fat out of bloatted universities.

      • Bond Uni is private but the other ones are not. The other ones are taxpayer-funded rorts.

        Foreign students bribing professors to get what they do not deserve? That is corruption.
        Even the immigration department is not free of corruption:

        A corrupt Immigration Department official and her husband helped run a $3 million criminal migration racket that involved making more than 1000 fraudulent visa applications.

        The taxpayer-funded “unis” are not required to get even half of their graduates into reasonable jobs – the funding has no strings attached!

    • Thanks for the article on corrupt Immigration officials from India. I suspect there are many a application being pushed through due to money exchanging hands and or ethnic nepotism. Anyone could see this was going to happen given the way India is run. It is a culture infested with corruption. And we want to import that mindset?

  3. Why not doing what big and famous US universities did: open campuses in foreign countries ?
    AH maybe because almost none is studying here because of value of pour degrees but because of something else

    • If they did that, they would quickly discover their brand isn’t so strong after all. Compete with Harvard and Cambridge, yeah right.

  4. All this is well worn territory in ‘Science Mart’ – 2011

    This trenchant study analyzes the rise and decline in the quality and format of science in America since World War II.

    During the Cold War, the U.S. government amply funded basic research in science and medicine. Starting in the 1980s, however, this support began to decline and for-profit corporations became the largest funders of research. Philip Mirowski argues that a powerful neoliberal ideology promoted a radically different view of knowledge and discovery: the fruits of scientific investigation are not a public good that should be freely available to all, but are commodities that could be monetized.

    Consequently, patent and intellectual property laws were greatly strengthened, universities demanded patents on the discoveries of their faculty, information sharing among researchers was impeded, and the line between universities and corporations began to blur. At the same time, corporations shed their in-house research laboratories, contracting with independent firms both in the States and abroad to supply new products. Among such firms were AT&T and IBM, whose outstanding research laboratories during much of the twentieth century produced Nobel Prize-winning work in chemistry and physics, ranging from the transistor to superconductivity.

    Science-Mart offers a provocative, learned, and timely critique, of interest to anyone concerned that American science–once the envy of the world–must be more than just another way to make money.

    So whilst this is being couched in immigration factors the issue is much more fundamental from an educational – knowlage perspective. Hence you might change the immigration factors albiet that does nothing to change the fundamental approach used by the Unis in operating, but what would one expect after decades of TINA, just look at the elites response to Yuval Harari’s writings in contrast.

    • rriiiight! because every-f*cking-where this competition trope got trotted out – it has worked out like a charm! FFS – the “market competition” BS is cut from the same neoliberal cloth as “meritocracy” and “smaller government”.

      You can’t absolve yourself from f*cking managing the sector and just sit there and look pretty, all the while sprouting BS phrases which mean nothing and have no consequence. You can’t do that and then expect the damned thing to just pull itself by it’s bootstraps and keep going all by itself!

      Every sector in a country needs to be managed, competently managed. It is the f*cking role of the government!

      GAaah!! I had enough of this “let the markets sort it out” bullshìt! They never do – the markets (if there ever is such a thing) all they want is total and undeniable monopoly! Theeeeen you can rake it in.

  5. I was accepted into a post-graduate degree many years ago. The price was 100k plus incidentals. I’d still like to do more post-graduate studies but cannot justify it as there is a negative ROI. If I can earn four figures a day it makes no sense.

    It does make sense for foreigners to spend big because they are buying PR (and buying a degree because the universities will not fail them – only in the most extreme cases. Asian culture is such that if you pay for something you receive it, so the attitude is they are buying degrees and are entitled to PR).

    There is probably an opportunity for niche companies in tech to headhunt school leavers rather than uni grads.

    • >There is probably an opportunity for niche companies in tech to headhunt school leavers rather than uni grads.

      I think the technical term is “diminishing returns on slim pickings”

  6. This hits close to home for me. I’m currently studying a Masters degree and I’m the only “white” person in any of the courses I enrolled in. Group meetings are awful too, with one student even saying they were going to run the meetings talking in Mandarin (which they mostly do).
    All the lecturers are mostly Chinese as well, and often drop little Mandarin phrases in their lectures.

    • Can you please secretly video the mandarin lectures/ tutes? Then send it to media. We need something like that to blow this scam up.

  7. We have 673,000 foreign students & partners onshore. 204,000 are Mainland Chinese communist.
    See AustralianEducation Gov Snapshots website as reference.

    Not all foreign students are on an international student visa, but also on other categories.
    Many are not studying – this number includes 53,000 ‘partners’ as ‘secondary’ on the primary foreign student visa & they enter with no English & full work rights & very long stay 4 to 9 years depending on visa churn & extension.

    75% work illegally – (USyd & UTS studies).

    Growth: 624,001 in Dec 2017, increased by 8% in 2018.

    “The number of student visas had increased with the booming international student industry in Australia, now worth an estimated $32 billion*.”

    ➡️It’s $32 billion of ‘economic activity’.

    Not a $32 billion ‘export’.

    673,000 foreign students & partners at an average GDP economic activity of $47.5k each or $914 each a week. (Treasury)

    They lower Australian GDP by -2.7%

    Their income is EARNED HERE – mostly
    illegally (75%).
    NOT AN EXPORT at all.
    An importation of negative GDP per capita.

    Fact check:
    The entire foreign student intake only brings in $2.4 billion in declared funds & mostly not checked or easily frauded. (DHA declared funds / checked & self declared)

    Fees: They only pay $7.8 billion in fees. Source Deloitte.

    Job impacts.
    They displace at least 500,000 Australians in working illegally / cash in hand- costing $9 billion in Centrelink alone. (We have 1.3 million unemployed & 1.1 million seeking work)

    Many don’t pay tax / 75% work illegally cash in hand or fake ID – so another $4 billion negative.

    They lower wages for all Australians costing tens of billions in direct wages loss (-6.7%) plus lower taxation.

    They destroy housing – occupying some 150,000 ex Australian dwellings, usually foreign owned cash in hand sublet, bunk share and a falsified rent by that foreign owner, no tax paid.
    Tens of billions lost.

    They have destroyed Australian education (fallen 10 places globally). Tens of billions lost.

    Social impact.
    Congestion. 90% are in Sydney or Melbourne. Long stay to very long stay (4 to 9 years is common).
    Driving some 100,000 cars on international licences. Congesting trains & public transport. Sparking massive projects such as Sydney Light Rail ($4 billion) that they will never pay for.

    City housing affordability crisis.
    (Tasmania issues triggered by University of Tasmania expansion of 8,000 foreign students occupying at least 1,800 existing modest ex Australian dwellings yet no housing built yet – and only 400 beds in accommodation is planned).

    116,000 Australian permanent homeless & 340,000 seeking affordable housing.
    Costing tens billions.

    Human Capital Value.
    Of the 673,000 foreign students & partners only 38,000 are doing genuine post grad high level education.
    The other 635,000 are doing low level nonsense courses available free online or in their home country (or as a ‘partner’ no course at all & working full time or working illegally). Most courses have no or low international recognition.
    The progression of a foreign student into a high income professional vocation is 3.7%.
    Meaning that 96% fail to ever achieve any human capital value above average – in Australia (where they join the dole queue as a PR) or in their home country.

    Where exactly is the ‘EXPORT?’

    The entire Australian ‘foreign student industry’ is economically & socially negative.

    It needs a Royal Commission.