International students destroy Australia’s productivity future

Last week, Adrian Blundell-Wignall – former director of the OECD, an adjunct professor at Sydney University and author of Globalisation and Finance at the Crossroads – penned the following in The AFR on how to “turbocharge Australia’s productivity”, which claimed that “better education output is central to future productivity growth”:

More generally, the “plan” should be a framework that provides a research-and-innovation culture and policy certainty. The plan should recognise that better education output is central to future productivity growth.

After reading this diagnosis, it immediately sprung to mind that Australia is doing the complete opposite on the “better education output” front.

As has been reported repeatedly on this site, Australia’s tertiary education system has morphed from “higher learning” to “higher earner”, with universities turned into ‘degree factories’ for maximum profit.

Nowhere is this more evident than with our universities’ ruthless pursuit of international students, whose numbers have nearly doubled over the past six years:

This surge in numbers has driven the share of international students studying at Australia’s universities to alarming heights:

In fact, if the current trajectory of international student numbers is maintained, then the share of international students will soon overtake domestic students.

Australia’s universities and the federal government have actively sought international students because of the lucrative fees on offer. This is illustrated clearly by the below chart from NSW Auditor-General:

As well as the below graphic from the ABC showing the export income associated with the surge in student numbers:

While universities and government always talk up the financial dividends from international students, they refuse to acknowledge the broader costs to productivity associated with the boom in international student numbers.

The recent Four Corners expose on Australia’s international student trade exposed these costs, presenting damning evidence that Australia’s universities have badly lowered entry and teaching standards in a bid to entice large numbers of lower-quality, full fee-paying international students, most of whom lack basic English language skills.

A separate Four Corners report aired in 2015 similarly documented widespread cheating, plagiarism and fraud by international students at Australia’s universities.

Alongside ballooning international student numbers, the ratio of students to academic staff at Australia’s universities has materially worsened, increasing from 20.05 in 2009 to 21.44 in 2017:

This is a clear metric showing that education quality has been eroded, especially when viewed alongside most international students being of Non English-Speaking Backgrounds and, therefore, having higher needs than native English-speaking domestic students.

Basically, Australia’s future productivity has been put at risk from the commercialisation of Australia’s universities into ‘degree factories’. Education has been turned into a commodity to be sold for maximum profit, rather than a tool for up-skilling the population.

Leith van Onselen
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  1. If u walk around any major uni In australia it doesnt feel like an australian uni like even 20 years ago. Flooded…and i mean carpet bombed with internationals who dont even have to interact with the locals except in group assignments

    Vcs happy…they get their million
    Govt happy…look how vibrant we are…GDP!!

    It’s disgusting and traitorous
    Traditional Australia is being rapidly replaced ..our ww1 and ww2 diggers needn’t have bothered

    • @Jamie11 at the forefront of this “carpet bombing” is China. They’re using our own liberal policies to demographically replace the European population’s in Sydney and Melbourne. Once they are the demographic majority they’ll be able to use the ballot-box to agitate for policies which deny the US Navy the anchorages of Sydney and Melbourne.

    • Jamie; having worked at a Victorian GO8 University for over 20 years, I see this every day and have seen the changes happen before my eyes. Its actually quite depressing.
      Part of what has caused this is that much of the material that (local) students need; be it lectures, course materials etc. are all online and a student can easily access these from home. Local students tend to live further away from Uni campus and we know how delightful public transport in Melbourne is these days.
      As far as driving in to campus. Forget it, logistically it is just not viable unless a student is prepared to pay $20 – $25+ for some sort of all day parking.
      The vast majority of international students live in nearby multi storey student apartment dog-boxes and can walk to campus quite easily.
      The whole University experience of 20+ years ago has radically changed and students use FaceBorg and InstaHoe as a social proxy.

  2. I always wonder how long Anzac Day will last. At one point almost every Australian had a family member who served in WW1. But we are rapidly replacing our population with people who have no connection with WW1 or any other tradition remembered on the 25th April. Why would these people celebrate Anzac Day when it doesn’t mean anything to them?

    If you don’t share a common history and culture what do you share? You are just a widget, an economic unit to be manipulated by your globalist betters.

    • When ANZAC day is on a Saturday, there are still auctions in vibrant areas. You are correct, we are rapidly moving from a society to an economic unit.

    • That would happen anyway as time passes. My grandfathers served in WWII; the Great War is fading into a historical event.

      Additionally, there is a historical argument that the wrong side won the First World War, which directly led to many of the horrors of the twentieth century, including Communism, Nazi Germany, and the rise of fascism in general.

    • Anzac Day will probably last longer than you expect.
      Although white Anglo-Australians with forefathers that fought for this country or who can identify with or appreciate the sacrifice given will gradually become a smaller proportion of the population; Anzac Day will be one of the few acceptable, legitimate and viable ways to “celebrate” the white Anglo history of this country in the face of Vibrant Overload and High Level Cultural Enrichment (or should that be degradation?)

  3. reusachtigeMEMBER

    International students are great because they bring in some diversity into our universities.

  4. What ridiculous twaddle!
    It’s simple really, just ask yourself one question:
    Are the top ten percent of Australian graduates any more or less capable than their cohort of 25 years ago, or 10 years ago or in this case 5 years ago (pre international student explosion). If the answer is no than our universities are still fulfilling their traditional role of educating and training our top 10%. If our universities succeed with this task than we’re no better, nor worse, served than our fathers and grandfathers.
    What has changed, however is the need for a more educated / more skilled 10% to 50% sector of the population. The mundane jobs of yesteryear are gone (shipped overseas or replaced by Automation…doesn’t matter which because they’re gone for good).
    So the task at hand is to create a Tertiary education apparatus which addresses the needs of this slice of the population. 10% to 50% …
    what do they need to learn?
    what skills will make them Productive?
    what does Productive even mean with an economy like Australia’s?
    Is the net work-output of our combined Human capital a Tradeable product or Service?

    Of course the all important question is : How will we pay for this Tertiary education transformation?
    In traditional Aussie style we’ve decided how many Aussies we want our universities to educate but we’ve forgotten to allocate an appropriate budget for the required task. The Universities have found a solution (International Students) and guess what we’ve discovered that this solution has a down-side (increased Permanent residence and depressed wages especially with starter jobs) ..Well the solution is to dig into our pockets and pay to educate at Tertiary level whatever percentage of our population we deem necessary.
    But before we get too excited about this idea maybe we need to think real hard about what skills we actually expect them to learn, are there any jobs in this sector? are our kids capable of contributing at the level that will be necessary to make a difference (as in create globally tradeable products) If not than we need to recognize that this additional Tertiary Education is all for Naught. That’s the discussion we really need to have! But hey in the mean time lets just get distracted by International Students. (btw I just saw one hack on the footpath …totally disgusting…where do they find them)

    • the top ten percent of local graduates don’t have much cultural diversity……

    • I believe the top 10% are just as capable. However I don’t believe that universities are stretching them like they used to. Certainly not within the normal curriculum. So no, I don’t believe universities are fulfilling that aspect of their job.

      • Agreed, the minimum standard for a Bachelors level degree has dropped but that said any student that really cares to graduate with a worthwhile degree is including a good number of a masters level courses in their Bachelors degree. From what I’ve seen there’s also a very significant difference in the quality of graduates (with Engineering degrees) from top 4 universities compared with the graduates from the lesser known Universities.
        So a top 4 university student that’s in the top 25% of their class is a very smart, capable and diligent individual, definitely worth getting in for an interview. …as for the rest ..well .I’m certain they’ll find a job somewhere.

      • @fisho how do these overseas students from china and India pass their courses??? Entrance requirements are non-existent and there is voluminous anecdotal evidence of academic’s being compelled to either pass students who clearly do not deserve to be passed and/or dumbing down the course content to suit the overseas students and domestic students who are admitted under the demand driven funding system, it’s a race to the bottom.

      • @Jim ….Ah yeah …the less talented graduates are significantly less Talented.
        But this is not really a problem, because i don’t even bother to interview them, I have a limited number of slot to fill and I prefer to devote my efforts to helping to mentor / employ our best graduates. To be honest I just don’t have time to provide remedial help for the also-rans graduates, so to be honest I have no idea what they do.

      • @fisho. I have worked at Australia’s top ranked university for a decade and also one of its bottom ranked (for not so long). What you might miss in your interview strategy is some real gems. Smart kids without a private school education. Worked on farm, etc first in family at uni. Don’t know differences between universities. Don’t come with sense of entitlement. Practical with hands and sharp minds. Not saying it always the case, but they are certainly there still. If it is a real engineer you want, someone with an actual lived interest, I would look for these kids over many of the theoretical engineers.

        I have heard a go8 university refer to themselves as a finishing school for the private schools. I have also heard a Head of Department lament at having to discipline and so fail a private school boy.

      • @fisho, this isn’t simply, “well I’ll use my experience and knowledge to filter out the less capable”. The demand driven funding system is a free for all where students with ATAR scores below 50 can be admitted into a course and the Australian productivity Commission’s report into this practice states the obvious, it leads to degrees being de-valued and places a huge economic burden on the country as these students have a high drop-out rate and are left with a taxpayer funded FEE-HELP debt and this goes without mentioning the dumbing down of coursework so Universities can report high pass rates.

      • DominicMEMBER

        Trots, while you’re 100% correct, the issue is the vetting process, which, when time and resources are in short supply, means you will undoubtedly miss out on some real gems. The only answer to this conundrum, that I can think of, is dramatically reduce the Uni numbers and people doing certain courses. That’s where the vetting process should begin — at the University door. Right now the Uni system is just spraying gargantuan amounts of sh!t at the walls and seeing what sticks. This is no good for our country or the economy.

        When I joined my first employer (a global organisation) the head of the graduate recruitment program admitted that her department sorted the applications into two piles (without vetting any of them) and threw one of the piles in the bin. They received over 20,000 applications every year and simply didn’t have the resource to go through them all.

      • @Trots, Yes I agree I’m missing out on some real gems, no doubt about it, but as Dominic also said, for me it all comes down to filling a limited number of slots in a limited time, so I don’t really need or want to go shopping in the discount isle, I’d prefer to pay for the best and get the best. I just don’t have time to sort the wheat from the chaff (traditionally this was one of the functions of a good university) I remember when I did my Bachelors they addressed the first year class and told us that only 1/3 would graduate with this degree, you know what 4 /5 years later they were correct. About 1/3 of the starting class graduated with an Engineering degree, some dropped out completely, some pursued other majors but the bottom line was that the University performed its requisite sort function. If our universities have decided to relinquish this responsibility than industry will respond with its own sort function.

    • Jumping jack flash

      “what do they need to learn?
      what skills will make them Productive?”

      Making coffee, painting nails, massage.
      At the higher end of the scale, education, nursing and probably natural therapies.

      Then they can assist others to obtain maximum debt.
      Debt and debt growth is where the actual productivity is.

      As you say, everything else is automated or shipped overseas. The only thing left is to provide services to those who have become instantly rich from someone else’s debt.

      • That’s a bit dystopian for me,
        Are we honestly expecting our best’n’brightest to devote their lives to achieving perfection in boomer butt wiping, hair dressing and Coffee creation?
        Maybe there in lies the fallacy of higher education.

  5. Jumping jack flash

    Destroying productivity? No! These valuable students add to productivity by being employed in the service economy for ultra, ultra cheap.

    There’s a never ending supply of them too! Thanks, universities.

    The owners of these businesses will then pocket the difference, keeping prices fairly stable while growing their own incomes boosting productivity!

    Then the extra income is used to obtain more debt to attach to houses, making others instantly rich.
    The cycle continues forever.

    Most importantly though, debt grows, growing the economy.

  6. So my wife who supervises students doing their final prac in hospitals is at the coal face on this. Most recent example she had a young Chinese girl who my wife made the recommendation she shouldn’t pass and instead should complete another prac or be failed until she can demonstrate she is competent. The wife’s boss took on this recommendation and relayed that back to the university. The universities response? They said look we’re going to pass her no matter what you say on the proviso she returns back to China and doesn’t practice in Australia… How good’s Australia!

    • Incredible corruption!

      Is this to work as a nurse or doctor?

      How the heck is the “uni” going to make sure that the “graduate” goes back to the third world.

    • @Byron, the sad thing is, even if your wife complained to the Higher Education regulator, TEQSA, they would do nothing. It is the best example of what is called ‘regulatory capture’. My only advice to you, is have your wife document in detail what has occurred so she can protect her backside when the ensuing lawsuit is filed against the organisation this student ends up working in.

      • @Byron tell your wife to complain to ANMAC, they’re the accrediting body for Nurses in Australia and any course which claims the student can practice as a registered nurse needs to be accredited by them first. They’re a serious bunch of people over there, they’d be very interested to here of this.

  7. heading is simply wrong and quite dangerous

    Our political and economic elite who turned our education into an immigration ponzi scheme destroyed Australian productivity future not foreign students

    Foreign students have no power in this country what so ever so blaming them for anything is quite disguising

    • @doctorx, tell me how overseas students paying a foreigner to fabricate evidence of English language testing and work history so as to obtain a certificate isn’t disgusting???

      • that’s not disgusting, it is inbuilt into the system created by our leaders?
        do you think our elites want foreign students to speak good English or they just want to have fake requirements in place to wash their hands in front of domestic public?
        it would take 2 weeks to get English standards high but than 50% of foreign “students” would not come, not pay high fees to mates running fake educational institutions and not work 60h a week for $500 cash on hands

      • @doctorx you’re shifting the blame to the Government when there is overwhelming evidence students from the sub-continent and China are simply arriving here for nefarious purposes, these people do not make good citizens,

      • Plenty of blame to go around. One of the factors in this, in my opinion, is the desire of the politicians to disguise youth unemployment in the domestic population to avoid opposition to neoliberal policies (as well as being kicked out of office). They eliminated a perfectly good system of colleges of advanced education and technical colleges to dramatically expand the university intake from 7% of high school students in the 1960s to nearly 50% at present for public high schools and even higher for private schools. While 7% was too low, 50% is far too high and very expensive for no good purpose. The whole scam is subsidised by the international students.

      • @jimsmith764
        you cannot blame someone for not being a good person. They are doing things that are made by our government either perfectly legal or decriminalized.
        It’s like blaming a resident for not cleaning the street
        Our government knows why these people are coming and they are letting them in to do those things – they are to blame for what is happening

      • @doctorx, the students are complicit in this behaviour, they simply see Australia as a country to be exploited for its naivety.

  8. Needs a Royal Commission.

    The foreign student industry is not a $33 billion export.
    Their money is earned here.

    Less than $2.4 billion is ever declared a year ‘coming in’ – often self declared or extensively frauded.

    Their money is earned here. Usually illegally in visa breach. Including in vice – an allowed source of income.
    The education itself is a joke.
    Low level English learning or nonsense courses with certificates & diplomas with no international accreditation. All available in their home country for cheaper or even free online. Or very easily cheated university courses, stretched out to maximise work hours & designed to be easy to cheat.

    75% of foreign students work illegally (Sydney Uni & UTS study – published in the SMH 2016).

    Yes it is $33 billion of ‘economic activity’ with 712,000* foreign students & partners* at a treasury estimate of $47.3k.

    That $47.3k economic activity each and -just over half the Australian gdp average.
    That alone lowers Australian gdp by 6.8%.

    The total Fees paid are $8.3 billion – from money earned here.
    Not export income.
    Just payment of a visa alibi from money earned here.
    Often illegally.

    Unemployment impact.
    75% of the 712,000 foreign students work illegally = 534,000.
    We have 1.5 million Australians unemployed.
    The foreign students create a direct unemployment impact to 534,000 Australians now unemployed.
    That alone costs the Australian taxpayer $9.3 billion.

    => Just the direct unemployment cost to Australians exceeds the total foreign student fees paid.

    🔻tens of billions in wages loss to other Australians,
    🔻housing contention,
    🔻degradation of our education system,
    🔻public infrastructure impact.

    Each foreign student or partner allowed into Australia costs Australian society tens of thousands of dollars in social and economic impact.

    It needs a Royal Commission.

    *There are 712,000 foreign students across all visa categories.
    You can not use enrolment or commencement data, as some are doing no courses during a break some are doing multiple courses.

    The numbers in March 2019.
    ▫️615,000 DHA primary visa holders,
    ▫️63,000 DHA secondary visa holders as ‘partners’
    ▫️28,000 DFAT & other grants across a sprawl of visa categories.

    => 712,000

    90% or 640,000 are in Sydney & Melbourne.
    Over 90% are of unskilled third world origin.
    It’s just blatant third world migrant labor trafficking – using so called education as a visa alibi.

  9. DominicMEMBER

    “better education output is central to future productivity growth”. Yeah nah. That’s the least of the issues regarding productivity.

    Govt intervention in the economy (including the central bank setting interest rates) is ground zero for diminishing productivity.
    By intervention:
    – immigration ponzi (includes huge of numbers unproductive people burdening a welfare system that’s too large for its own good already)
    – infrastructure overload (congestion, wasted hours in traffic and journeys between work, worker fatigue etc)
    – over regulation meaning companies have to direct scarce resources to ticking boxes and filling out paperwork rather than making money and growing the business.
    – RBA driving rates to near zero, thereby propping up sickly, unproductive companies which consume resources (both labor and capital) that could be more productively utilised elsewhere in the economy
    – artificially low rates also encourage unproductive bubble activities also consuming valuable resources (see above)

    The term ‘productivity’ is either misunderstood or most academics simply refuse to acknowledge what drives it. ‘Better education’ would be nice, but it’s not the true issue here. Not even close.

  10. nexus789MEMBER

    Productivity is irrelevant if an economy is not ‘competitive’ which is driven by technology. Being ‘competitive’ is key to creating economic wealth, building industrial capacity, creating jobs, balancing trade, etc. Things like productivity, R&D/Innovation, skills, finance, etc. are all inputs to achieving this objective. Economists are generally clueless as to why an economy goes into decline and consequently their remedies to try and address economic decline only make the situation worse.