The calm before the international student storm

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The latest Overseas Arrivals and Departures figures from the Australian Bureau of Statistics (ABS) revealed that international student arrivals have failed to rebound following the reopening of Australia’s international border late last year.

Only 35,110 international students arrived in Australia over the quarter – down significantly from the decade average of 98,000 quarterly arrivals:

International student arrivals (quarterly)

Quarterly student arrivals remain soft.

Over the year to June 2022, only 79,920 international students arrived in Australia. This is down massively from the 612,000 annual arrivals in June 2019 – the year before the pandemic arrived:

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Annual international student arrivals

Annual international student arrivals failing to launch.

The lack of international student arrivals helps to explain why Australia’s net immigration has also been slow to rebound. As shown in the next chart, Australia’s net permanent and long-term arrivals – a leading indicator for net overseas migration – was only 65,700 in the year to June 2022:

Australia's net immigration

Australia’s net immigration also fails to launch.

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This is the calm before the storm, however. Data released this month by the Department of Home Affairs revealed that a record 42,700 offshore international students lodged a visa application to study in Australia in June, with many more applying in July:

“This is the largest number of offshore applications received in a single month in the last 10 years,” the department told education providers…

The department said that the high numbers seen in June are continuing, with an average of 10,000 student visa applications a week being received during July from offshore applicants. In comparison, only 34,015 student visa applications were received in June 2019, before the pandemic…

Immigration Minister Andrew Giles said 62,000 student visas had been finalised since the beginning of June…

Currently international students have no limit on the hours they work since the Morrison government removed the previous 40 hours per fortnight restriction in an effort to ease labour shortages.

Therefore, international student arrivals will soon launch, attracted by the recent uncapping of work hours.

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In turn, this will send net overseas migration sharply higher. And that’s before the Albanese Government has even opened the immigration floodgates.

About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.