Last week, the Australian Bureau of Statistics released details of how international student expenditure is recorded in Australia’s balance of payments, noting that in the 2023-24 financial year, this expenditure contributed $50.5 billion to Australia’s exports.
Why international student expenditure in Australia is considered an export industry is an often-raised question. The ABS article provides a detailed explanation, including how international students are measured in the Current account and their relationship to the National Accounts.
In short, as international students are classified as ‘non-residents’, their expenditure on goods and services (including tuition fees, food, accommodation, local transport, health services, and so on) is included in the education-related category of Travel services exports (credits).
The ABS addresses the issue of how students fund their expenditure in Australia, “the classification as an export of expenditure by international students studying in Australia does not depend on how the students fund their expenditure in Australia. Some of the expenditure is funded from overseas sources”.
According to ABS estimates, about a quarter of expenditure (around $13bn in 2033-24) is funded by international students working in Australia for Australian employers.
This has been an issue of contention for some years, with the sector and the ABS accused of overstating international students’ contribution to the Australian economy. What the ABS doesn’t go on to say is that much of this money is put back into the Australian economy, with students using these funds to pay for living expenses and tuition fees, and students are often employed in roles that are hard to fill.
Education would remain as Australia’s fourth largest export industry in 2024 at $37.5bn, even if earnings made by international students were removed.
What Australian students spend overseas
Expenditure on goods and services (travel services imports) by Australian students studying abroad was $500 million in 2023-24
The ABS article is available here.
