Graduates in limbo: International student visa pathways after graduation

by Brendan Coates, Trent Wiltshire, Tyler Reysenbach

02.10.2023 report


Australia offers international students generous rights to stay and work here after they graduate, which gives false hope to thousands of graduates who will never gain permanent residency, adds to population pressures, and threatens Australia’s reputation as a destination for tertiary study.

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Many international graduates stay in Australia on temporary visas once they graduate, but struggle to pursue their chosen careers.

Only half secure full-time employment, most work in low-skilled jobs, and half earn less than $53,300 a year.

Many international graduates are also stuck in visa limbo: less than one third of Temporary Graduate visa-holders now transition to permanent residency when their visa expires, down from two thirds in 2014.

One-in-three graduates return to further study, mostly in cheaper vocational courses, to prolong their stay in Australia.

Federal government policy is moving in the wrong direction. Grattan Institute modelling shows that the government’s recent decision to allow many graduates to stay and work for even longer is a big driver why the number of Temporary Graduate visa-holders in Australia will almost double to about 370,000 by 2030.

That will leave even more graduates stuck in visa limbo, with even worse prospects of ever securing permanent residency, while adding further pressure to Australia’s already-tight rental markets. 

Encouraging so many international graduates to stay and struggle in Australia is in no one’s interests.

It erodes public trust in our migration program. It hurts the long-term prospects of those graduates who do stay permanently. It’s unfair to those graduates who invest years in Australia with little prospect of securing permanent residency. And it adds to population pressures in areas like housing.

The government should: 

  • Cut the duration of post-study work visas for international graduates.
  • Raise the English language requirement for Temporary Graduate visa-holders.
  • Limit Temporary Graduate visas to people younger than 35 (down from 50 now).
  • Scrap visa extensions for graduates with degrees in nominated areas of shortage, and for graduates who live and work in the regions.
  • Only offer visa extensions to graduates who earn at least $70,000 a year.
  • Create a new ‘Exceptionally Talented Graduate’ visa which offers a direct path to permanent residency for the most talented international graduates.
  • Offer more help to international graduates who do stay to pursue their careers in Australia.

These reforms would cut the number of graduates we leave in limbo, while ensuring Australia continues to attract the best international students and help the best graduates to stay.

Australia shouldn’t keep offering so many international graduates false hope about being able to stay here permanently, when most clearly can’t.