Opinion
Australia would not cap iron ore exports to China without asking what it would mean for national income, jobs and regional relationships. It would not put arbitrary limits on beef exports to Indonesia, LNG to Singapore, or tourism across the Asia-Pacific without first asking what revenue, capability and influence would be lost.
Yet in higher education, one of Australia's most important export sectors, the teaching of international students is increasingly being treated as a service to be rationed.
We are now into our second year of national planning with caps placed on every university around the number of new commencing international students. Unsurprisingly, these caps have become a theoretical number as international recruitment into Australia has dropped off significantly. At most Australian institutions, recruitment is nowhere near these theoretical caps. It is as if discouraging people to study in Australia has become a policy virtue, rather than a risk to an industry that supports jobs, research, regional relationships and sovereign capability.
Higher education is not just a visa category. It is an export industry, a workforce pipeline, a research system and a regional relationship network. That is why the Government should not only ask how many students Australia admits, but whether the systems that sit behind migration, skills and workforce policy are actually working together.
Right now, they are not.
Australia's labour productivity growth is, by the Productivity Commission's own assessment, the worst on record. More than 90% of jobs forecast over the next decade will require a post-school qualification. A lift of just 0.5% in labour productivity could increase GDP by up to $13 billion.
Yet the talent to help close that gap is already here. In a recent National Press Club address, Dr Martin Parkinson, Chair of Australia’s Review of the Migration System (released in 2023) and Chancellor of Macquarie University, noted that around 2.9 million people in Australia are neither citizens nor permanent residents. About 2.3 million have work rights. And 44% of qualified permanent migrants are working below their skill level (around 620,000 people), often in the professions that Australia actually has shortages in.
As he noted in April: "When Australia invites someone here because of their skills, there's an implicit bargain: we'll let you use them to your benefit, but even more so to ours. Right now, we are not keeping our end of the bargain."
If the Government wants to manage the system better, there are some practical solutions. But they involve better managing our skills and migration systems, not our universities.
The Activate Australia’s Skills campaign, led by CEO of Settlement Services International Violet Roumeliotis, has brought together a broad coalition of businesses, unions and community organizations to reforms our skills recognition system. What is needed is a national approach to ensuring that there is a seamless connection between our visa system, occupational licenses required in various areas, and demand for jobs. Currently, this is a patchwork across various assessing bodies, which is making it difficult for our labour market to work smoothly.
That campaign has called for an Ombudsman for skills recognition. In practice, a simple solution could be to task Jobs and Skills Australia with addressing this problem.
JSA already holds the data, the labour market intelligence and the stakeholder relationships across industry, unions and government. What it lacks is a clear mandate to coordinate the recognition pathway as a single system rather than a patchwork of disconnected assessments.
These are policy reforms, not funding asks. If they get addressed, then it allows us as a country to have a more convergent conversation across the board and with universities about talent and migration as a sovereign capability that lifts productivity, not blames international students for housing unaffordability.
Just as Australia expedites iron ore, coal, beef and LNG through the infrastructure of export, it should be able to fast-track the skilled graduates, researchers and PhD candidates needed by our economy. That does not mean lowering standards. It means aligning migration, education and workforce policy with sovereign capability and industry needs.
For more than two decades, Australia has built itself into a higher education powerhouse. That did not happen by accident. It was built through institutional quality, research strength, trusted regulation, proximity to Asia and a national proposition that combined education, opportunity and connection.
Those who do come build professional, cultural and personal ties that can last for decades. Some stay. Some return home. Many continue their careers across borders. Over time, they become part of Australia’s wider network of influence, connection and trust. Recent reporting on Australia’s international education footprint noted there are at least 160,000 alumni of Australian universities in Vietnam alone, a reminder that graduates who build careers abroad are part of the export value of the system; not a failure of it.
There are lots of vested interests pointing blame at university managers at present and seeking government intervention in university management. Ironically, the Commissioner of Jobs and Skills Australia, Barney Glover, is also serving as interim Commissioner of ATEC, which is seeking to manage both international and domestic student numbers across the country.
There is indeed a system that needs better management in order to drive productivity but it’s not the universities – it is the system of jobs and skills, which helps drive labour productivity, growth and regional influence. Managing that better will direct our national ambition in a positive direction and put forward momentum into our regional position in Asia.
We should come together to see higher education as part of building sovereign capability and a passport to national growth, not as a blockade against the students, graduates and skilled workers Australia urgently needs.
Higher education is sovereign capability, not a migration problem.
Professor Eric Knight is Deputy Vice Chancellor (People and Operations) at Macquarie University.