One year ago, a group of academics released research showing that international student graduates on temporary (485) visas were struggling to find jobs in their field, with many being either underemployed in low-skilled jobs or unemployed.

However, because these international students perceive that the graduate (485) visa represents a pathway to permanent residency, they continued to arrive in Australia in huge numbers, as reflected in international student enrolments and graduate (485) visa numbers hitting a record high in 2019.

In October 2019, another report was released confirming that international student graduates were struggling to find work, with many occupying low-skilled positions or unemployed:

Australian government data shows occupations such as “sales assistants and salespersons” as well and “cleaners and laundry workers” are in the top three for 485 visa holders across all occupations.

Now researchers from Deakin and Charles Darwin universities are calling on the government to offer more generous graduate (485) visa access and assistance to entice more international students to study in Australia:

We conducted a survey in 2018-19 involving 1,156 international graduates. Most of them (76%) said Australia’s temporary graduate visa played a role in their decision to study in Australia.

But the sustainability of Australia’s international education will need to address issues relating to both post-study work visa arrangements and employment outcomes for international students after graduating.

Many employers lack understanding of the visa, prefer applicants with permanent residency or hold misconceptions of complex paperwork or sponsorship involved. The chance to gain work experience in their field during their study and after they graduate is limited for many international students…

Addressing existing barriers will enhance Australia’s reputation as a destination for quality education and a positive post study work experience.

The government and universities must also offer extended support to alumni stranded onshore, who may have been working here on their graduate visa but lost their job.

…especially for students from India
Indian students are most affected by the access to a post-study work visa. In our above-mentioned survey, 82% of Indian students considered the visa an important factor in their decision to choose Australia, compared to the average rate of 74% for non-Indian international students.

Delving into their actual report confirms that international students perceive the graduate (485) visa to be a vital ingredient to gaining permanent residency:
“As shown on Figure 7, participants who remained in Australia at the time of the survey (85%) showed high levels of agreements on the ranked statements that the temporary graduate visa has been a pathway to permanent residence”.

Thus, gaining employment via a graduate work visa is important for giving points in order to qualify for a permanent visa:

“For past holders of the 485 visa who remained in Australia, PR and TR visas leading to PR were the most common categories reported in the survey”.

Of course, this employment displaces other job aspirants – namely young Australians. And this report also explains how such student visas are not temporary at all:

Thus, this report basically explains the education-migration nexus whereby Australia sells permanent residency via the University bursar’s window.

Put another way, the international education industry is really just an immigration scam, with universities acting more like migration agents than educators.

The deleterious impact on Australia’s labour market is conveniently ignored, including the local graduates that will suffer from increased competition for jobs and lower wages.

Unlike temporary skilled shortage (TSS) visas, holders of graduate (485) visas are not required to be qualified for any of the jobs on the Skilled Occupation List. They do not need a firm offer of work from an employer. They are not required to be paid a minimum salary. Nor must they find a job related to their qualifications or require a certain level of skill.

Basically, 485 visa holders may work or study in any job, for any employer. And their visa remains valid even if they cannot find a job.

Therefore, any increase in graduate (485) visas presents another positive labour supply shock that will lower the bargaining power of younger Australians and local graduates, in turn placing downward pressure on wages.

Rather than loosing access to the 485 visa, it should be tightened significantly. Otherwise, wage growth will never recover, especially given current high unemployment.


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