📊 Recent Trends in International Student Enrolments

Australia's international education sector, long a cornerstone of the nation's economy, is experiencing a period of stagnation in overseas student numbers. According to the latest data from the Department of Education for the year-to-date October 2025, there were 833,041 international students studying across various sectors in the country. This figure represents a modest decline of 0.3 percent compared to the same period in 2024. While total enrolments stood at 1,025,807—down 2 percent—the number of new students commencing their studies dropped more sharply to 190,799, a 15 percent decrease, with overall commencements at 447,014, also down 15 percent.

This slowdown follows a post-pandemic boom where enrolments surged beyond pre-COVID levels. Higher education, which includes universities, bucked the trend with a 10 percent increase in enrolments, reflecting resilient demand for degree programs. In contrast, sectors like English Language Intensive Courses for Overseas Students (ELICOS) saw a steep 37 percent decline. Top source countries continue to dominate: China accounts for 23 percent of students, followed by India at 17 percent, Nepal at 8 percent, and Vietnam and the Philippines each at 4 percent. These shifts indicate a moderation rather than collapse, but the trajectory points to no immediate rebound in growth.

For prospective students considering Australia, understanding these patterns is crucial. New Overseas Student Commencements (NOSC), a key metric tracking first-time enrolments, have been influenced by broader migration dynamics. Students from regions like Latin America, particularly Colombia, have seen sharp drops in visa approvals, highlighting vulnerabilities in diversified markets. Domestic universities in New South Wales and Victoria, which host the majority, face adjusted intakes, while growth appears in South Australia, Western Australia, and the territories.

These numbers underscore a sector recalibrating after rapid expansion. International education contributed AUD 51 billion to the economy in the 2023-24 financial year, but with flat or declining figures, stakeholders are adapting to a new normal.

Government Policies Driving the Shift

The Australian government's introduction of caps on international student commencements has been pivotal. For 2025, the national planning level was set at 270,000 new commencements, allocated as 176,000 for higher education providers and 94,000 for vocational education and training (VET). However, projections suggest Australia will fall short by up to 35,000 places, particularly in VET where demand has collapsed offshore. Visa grants for English language students halved compared to prior years, exempt from caps but impacted by policy tightening.

In a recent address at Universities Australia's annual conference on February 26, 2026, Assistant Minister for Immigration Julian Hill stated, “I don’t think people should expect to see more student numbers.” The emphasis is on value over volume—prioritizing high-quality students who contribute economically and build long-term ties, such as through soft power and diversification into Southeast Asia. For 2026, the cap rises modestly to 295,000, with 196,750 places for higher education. Public universities receive indicative allocations based on performance, including student accommodation provision and regional engagement, while private providers see 3-5 percent increases.

These 'soft caps' operate by prioritizing visa processing up to 80 percent of a provider's allocation, after which approvals slow. Exemptions cover schools, research students, Pacific Islanders, and pathway completers. Accompanying changes include higher visa fees (now AUD 2,000), stricter financial requirements, and reduced work rights, deterring lower-value pathways. This managed system, overseen from 2027 by the Australian Tertiary Education Commission, aims to align education with migration goals, easing housing pressures exacerbated by past surges.

Prospective students should note that while higher education remains accessible, especially for bachelor's and postgraduate programs from established universities, competition is fiercer. Applying early to priority providers enhances chances. For those eyeing post-study work visas, focusing on fields like STEM or health—aligned with Australia's skills needs—improves pathways.

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🎓 Financial Pressures Weighing on Universities

Australian universities are under significant financial strain, with international student fees forming over 25 percent of total revenue in 2024—around AUD 22 billion. This cross-subsidizes research (20 percent of income), infrastructure, and underfunded domestic Commonwealth Supported Places (CSPs), where real funding per place has fallen 6 percent since 2017 due to freezes and policy shifts like the Job-ready Graduates package.

In 2024, 13 universities reported deficits amid rising costs: salaries up 8 percent, with staffing exceeding 2019 peaks but more fixed-term roles. Sector surplus improved to 4.7 percent from a 3.6 percent deficit in 2022, but liquidity is tight—22 universities have current ratios below 1. Capital spending lags below 10 percent of expenses, hampered by discontinued government funds. International revenue rebounded to 2019 levels but slowed under caps, with NOSC allocations at 145,300 for public universities in 2025 (actual 139,300 commenced), rising to 161,725 in 2026.

Geographic rebalancing redirects students from overcrowded New South Wales and Victoria to emerging hubs, challenging revenue models reliant on high-volume urban campuses. Offshore programs now 40 percent of enrolments offer diversification but require long-term investment, not quick fixes. Experts warn that without stable policy, universities risk job cuts, program reductions, and eroded research capacity.

For academics and administrators, this environment heightens competition. Exploring higher ed jobs in growing regions or diversifying into transnational education (TNE) could mitigate risks. Check related insights on Australian universities' thin margins.

Broader Impacts on Economy and Stakeholders

The Reserve Bank of Australia notes international students boost demand more than supply short-term, fueling services, housing, and retail. Yet stagnation risks AUD billions in exports, local jobs (over 200,000 supported), and innovation. Universities' woes ripple: reduced research funding hampers national priorities like climate tech and health.

Students face high living costs—rising rents, fees exceeding AUD 250,000 for some courses at Group of Eight unis—and policy uncertainty. Source markets shift: resilient Chinese demand offsets Indian declines (visas down 30 percent on 2019). Communities grapple with housing strains from past peaks (one student per 34 Australians).

• Economic contribution: AUD 51 billion (2023-24), 71 percent from higher ed.
• Visa impacts: Approval rates below 75 percent in late 2025.
• Social effects: Protests link migration to rentals, prompting caps.

Stakeholders must adapt: students budget meticulously, unis innovate recruitment.

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University Strategies and Adaptation Measures

Institutions are pivoting. Curtin University's Vice-Chancellor stresses patient TNE partnerships with shared values for decades-long gains. Public unis prioritize accommodation and Southeast Asia ties for extra allocations. Private providers leverage pooled systems.

Enhancing student support—like financial literacy programs—retains enrolments amid cost pressures. Diversifying to Europe-style equity models or high-value postgraduate research counters volume limits. For career seekers, university jobs in administration or research remain viable, especially remote options via remote higher ed jobs.

Actionable advice: Unis should audit revenues, cut non-core spends; students verify provider allocations before applying.

Looking Ahead: No Quick Rebound Expected

With caps easing to 295,000 in 2026 but deterrents persisting, growth remains elusive. Minister Hill envisions stability for 'genuine, high-quality students.' Projections: enrolments stabilize around 800,000-850,000 annually, higher ed resilient at 500,000+.

Solutions include policy predictability, CSP realignment, and TNE investment. For students, Australia offers world-class education—ranked highly globally—but plan for costs and visas. Share experiences on Rate My Professor or explore higher ed career advice. Job hunters, visit higher ed jobs and university jobs. Post a vacancy at post a job to tap talent amid shifts. More on faculty positions.

Read the full Department of Education monthly summary or Universities Australia report for details.