English Australia CEO Ian Aird claims that the federal government’s proposal to cap international student numbers will have an economic impact on more than just the education sector.
Aird warns that it will also hit the small and medium-sized businesses that international students shop at daily.
Analysis by The Demographer’s Workshop suggests that international students spent almost $14 billion in local shops, cafes, and takeaway businesses in 2023.
Aird contends that reducing international student numbers by 30% from 2025 would, in turn, reduce spending in local communities by more than $4 billion a year.
“That’s all money out of the tills of small businesses and out of the pockets of mums and dads trying to pay their bills in the midst of a cost-of-living crisis’’, he said.
The estimate assumes that each student spends $24,000 a year, excluding tuition fees and compulsory health insurance.
The above analysis is voodoo economics. You cannot have an endless supply of students, or migrants more generally, without housing and infrastructure keeping up.
Otherwise, you get capital shallowing, lower productivity growth, and reduced living standards.
According to Ian Aird’s logic, more students and immigration are always beneficial because they result in more spending. There is no upper limit to how many students Australia can take.
The reality is that the explosion in student numbers has contributed to the rental crisis and the lack of infrastructure in our major cities. It has also driven the decline in pedagogical standards across the tertiary education sector.
For example, The Guardian reported in August that Australia’s universities have issued like candy to students who do not speak functional English and do not understand the coursework:
The Guardian followed up by exposing systemic cheating by international students at our universities:
ABC Radio reported that economics tutorials at the University of Melbourne were being held in Mandarin:
Meanwhile, the Australian reported that “dozens of dodgy training providers have been shut down over ties to organised crime, fraud and bogus qualifications”:
These reports all happened in the month of August and followed countless similar reports spanning more than a decade, including Four Corner’s 2019 report, entitled Cash Cows.
Four Corners detailed how large volumes of international students had undermined Australia’s higher education system.
An objective review of the international education sector would conclude that the explosion of overseas student numbers has severely harmed Australia’s tertiary education system, jeopardising the country’s productivity and living standards.
Higher education must prioritise quality over quantity.
