While labour market economists say international students working hard-to-fill jobs in hospitality, cleaning and other unskilled labour are unlikely to be harmed by a rise in unemployment, it is another story for the growing numbers of graduates, who as inexperienced workers may be the first to go as companies downsize.
While government policy is to increase the number of people on temporary graduate visas with the aim of converting more into permanent residents, the current number at nearly 200,000 was also at an all-time high – and this was despite record numbers being converted into permanent resident status through skilled migration programs.
Mr Rizvi said he was concerned that many former students on temporary visas would also find themselves in “visa limbo” if the job market slackens. That is, if they lose jobs they will be allowed to stay in the country, but will not have access to welfare.
New crash looming
Conditions that preceded three previous crashes in the student market were present and it was up to the Albanese to take steps to ensure the intake of students was more sustainable, Mr Rizvi said.
Those broad conditions were: a very rapid rise in student visa holders associated with a strong labour market and lax regulation; a high level of fraud among prospective student visa applicants; a rise in questionable education providers delivering low-quality courses designed to enable students to do little study and mainly work; and migration agents misleading students about the cost of living in Australia and pathways to permanent residence.
Phil Honeywood, chief executive of the International Education Association of Australia, said it was in “everyone’s interests to ensure the market remained sustainable”.
“History shows that if left to the Home Affairs Department the pendulum will swing too far in the wrong direction,” Mr Honeywood said.
“The Albanese government has a number of levers immediately available. For example, getting rid of the Covid Recovery 408 visa which is prompting too many students to jump out of studies to work full time.
“Additional resourcing of regulators to close down dodgy providers would also send the right message about quality control.”
There is a record number of international students and graduates in Australia.
Immigration Minister Andrew Giles said the government had spent the past year cleaning up “the visa mess left by the former Liberal government”.
“This government is addressing immediate problems by slashing the [visa] backlog and keeping wait times down, while looking ahead to reform the system through the migration review, working with higher education providers to better address their needs,” Mr Giles said.
However, the oversupply of former and current students could help resolve one of Australia’s hardest to fill job areas – aged care – after a deal between the sector, the government and unions forged a pathway that would allow temporary migrants to undertake a short course in aged care and are nominated for permanent residence by their employer if they stay in the same job for two years.
Low-skilled vacancies still available
Labour economist Jeff Borland countered Mr Rizvi’s analysis, saying job vacancies were so high that even a 1 per cent increase in unemployment would have little impact on international students’ ability to get a job – especially the kinds of low-skilled roles they often fill.
“The large inflow of students over the past nine months have just been eating into existing job vacancies,” said Professor Borland from the University of Melbourne.
Taylor Nugent, an economist with NAB, said the large influx of international students, which comprise the single largest group of temporary migrants, was “normalising” acute skill shortages and had “allowed the labor market to absorb this rebound in population growth”
“And when you have a lot of people coming in, they’re adding to demand in the economy as well.”
