Australia declared on Tuesday that it will cap the number of new overseas students it accepts until 270,000 in 2025. The government is taking this action as part of its attempts to control the unprecedented levels of migration, which have raised the cost of renting homes. The move coincides with Australia's efforts to remove Covid-era benefits for international workers and students, which were instituted to assist companies in hiring local labor during stringent border restrictions.
Education Minister Jason Clare noted that international student numbers have increased significantly since the pandemic, with a 10% rise in university enrolments and a 50% rise in private vocational and training courses. Under the new cap, universities will see a limit of 145,000 new international students, maintaining current levels, while practical and skills-based courses will be capped at 95,000.
The University of Melbourne and the University of Sydney have acknowledged receipt of their enrolment caps but are still assessing the financial and other impacts. Both institutions expressed concerns that the cap could negatively affect their operations and the broader higher education sector. Universities Australia warned that this move could significantly hinder the sector’s growth.
International education, which is Australia's fourth-largest export after iron ore, gas, and coal, generated A$36.4 billion ($24.7 billion) for the economy in the 2022-2023 financial year. Moody's Ratings predicted a modest impact from the cap, suggesting it would not severely affect the financial stability of larger universities, though it would limit growth in international student numbers over time.
In response to voter concerns about the strain on housing from high immigration levels, the Australian government has also taken steps to address the situation by doubling visa fees for foreign students and tightening rules to prevent the continuous extension of student stays. Net immigration reached a record high of 548,800 in the year to September 30, 2023, driven largely by students from India, China, and the Philippines.
