On Tuesday, August 27, Australia announced a cap on the number of international student enrollments, setting the limit at 270,000 for the year 2025. This move is part of the government’s strategy to manage unprecedented migration levels that have led to increased home rental costs.

This decision is part of a series of measures implemented since last year aimed at phasing out COVID-19-related concessions for foreign students and workers. These concessions had allowed businesses to hire locally while strict border measures restricted the entry of overseas workers.

Education Minister Jason Clare stated at a press conference that there are currently about 10 percent more international students enrolled in Australian universities compared to pre-pandemic levels, and approximately 50 percent more in private vocational and training institutions.

The reforms aim to enhance the international student sector, making it more equitable and sustainable for the future, according to Clare.

International education represents one of Australia’s most significant export sectors, contributing A$36.4 billion (US$24.7 billion) to the economy during the 2022-2023 financial year.

However, public opinion polls indicate that voters are increasingly worried about the impact of a large number of foreign students and workers on the housing market, positioning immigration as a key issue in the upcoming election, which is less than a year away.

Net immigration reached an unprecedented level in the year ending September 30, 2023, increasing by 60 percent to a total of 548,800, surpassing the previous figure of 518,000 recorded in the year ending June 2023.

In response to labor shortages exacerbated by the COVID-19 pandemic and subsequent border restrictions, Australia raised its annual migration quotas in 2022 to assist businesses in hiring necessary staff, which had been hindered for nearly two years due to the absence of foreign students and workers.

This record influx, primarily fueled by students from India, China, and the Philippines, has enhanced the labor supply and alleviated wage inflation; however, it has also intensified the existing pressures on the housing market.

To address the rapid increase in migration, the government recently more than doubled the visa fees for foreign students and committed to closing loopholes that previously allowed for the indefinite extension of their stays.