At a time when the performance of traditional exports are fluctuating, service exports such as international education are increasingly contributing to Australia’s prosperity, writes Jenny Lambert.

Beyond exports and jobs

With over 693,000 international students choosing to study in Australia in 2018, international education is Australia’s third largest export and has grown from $4.7 billion in 2000-01 to $34.9 billion in 2018 (ABS).

The jobs generated by international students are not limited just to the education sector, but span a wide range of industries and support over 240,000 Australian jobs. From visa and tuition fees, purchasing private health cover and routine consumer goods and services, international students consume a number of Australian goods and services.

There are also flow-on benefits to jobs in construction and infrastructure. In the education sector, students contribute to the cost of research and education of Australians by paying full tuition fees to Australian education institutions.

Suggesting that there should be limits on international student numbers while we play infrastructure catch up is like asking manufacturers and farmers to reduce their exports because it places too much pressure on ports and roads.

What about the demand on infrastructure?

This is not to say that international students do not place demand on our infrastructure – including housing and public transport – while they are in Australia. But the economic benefits vastly outweighs the cost. The intangible benefits of soft power diplomacy and increased cultural understanding that comes from a vibrant and diverse international student community are equally important.

Suggesting there should be limits on international student numbers while we play infrastructure catch up is like asking manufacturers and farmers to reduce their exports because it places too much pressure on ports and roads. Overcoming congestion and demand is about good and continuous planning, not restricting job and revenue-generating industries in ways that result in them operating below their potential.

For the minority of graduates who do seek permanent residency, the benefit is that these migrants are trained here, which makes their skills more relevant to Australia, without the costs of their education being paid for by taxpayers.

Undoubtedly, there is scope for greater regional dispersal to ensure the benefits accrued from international education are spread more widely across Australia. Currently, 97 per cent of international students study in our major cities with 70 per cent concentrated in NSW and Victoria. Strongly performing regional education providers, cheaper living costs, better regional infrastructure (including airports) and welcoming regional communities will hopefully entice more students to the regions. The recent changes to post-study graduate work visa for students from regional institutions and regional based scholarships improve the attractiveness of regional providers and the regions generally.

For the minority of graduates who do seek permanent residency, the benefit is that these migrants are trained here, which makes their skills more relevant to Australia, without the cost of their education being paid for by taxpayers.

Work rights and migration

Despite the obvious economic success of international education, there is pressure on two major fronts. Firstly, the work rights of international students are under the microscope both through the Migrant Worker Taskforce and the court of public opinion. Secondly, the growing number of international students is being dragged into a major discussion about population.

There is often pressure to limit work rights, either on the basis of pervasive underpayment, or on the argument that international students take jobs from Australians. Currently, student visas allow work up to 40 hours per fortnight during term and more during holidays. The question will be whether some stakeholders will seek to reduce this.

There is no doubt that extra compliance action is needed, and education providers will need to play their part in ensuring students understand their entitlements. Business and the education sector need to work together on this, as the students’ role in the labour market is highly valuable to business as well as making Australian education more attractive to international students.

When it comes to population, international students in Australia are classified as temporary migrants. And when their studies have concluded, only around 16 per cent of students go on to become permanent migrants. Those who choose to apply for permanent residency are subject to the same cap that puts a limit on all permanent migration – which has recently been reduced to 160,000 each year.

International students bring with them unique ideas, skill sets, personal and professional networks. When we leverage these attributes, Australian businesses – and the wider community – benefit by opening up new markets, improving processes and bolstering innovation.

If Australia does not recognise and embrace the benefits of a growing international education sector, there are certainly a number of our competitors ready to capitalise on this highly valuable export industry.

Jenny Lambert is Director – Employment, Education & Training at the Australian Chamber of Commerce and Industry.