Australia’s international education market is not collapsing. But according to the latest Studymove analysis, it is becoming something arguably more challenging for universities: a market that has stopped growing.
That was one of the clearest messages from Studymove Managing Director Keri Ramirez in the organisation’s latest data update, which examined international higher education commencements through the first half of 2026 and used student visa trends to look ahead to the remainder of the year and into 2027.
Studymove expects higher education international student commencements to fall by around 4% in 2026, which would be the first decline in four years. But Ramirez argues that the 4% figure is not really the story. The bigger story is that Australia has effectively been operating within a narrow band of international higher education commencements for several years, with the market hovering around 200,000 to 210,000.
“The cake is not growing,” Ramirez told the presentation.
And that changes the recruitment game.
When the overall market is expanding, universities can grow alongside each other. When the market stops growing, an institution seeking 8% or 10% growth has to take those students from somewhere else.
Market share, rather than market growth, is becoming the prize.
Offshore recruitment is shrinking
Perhaps the most significant shift is happening between students recruited offshore and those already in Australia.
Studymove’s analysis of January to May commencements found that overall higher education commencements were broadly flat compared with the same period last year. But beneath that relatively reassuring number was a very different story. The number of students recruited offshore fell by approximately 10%, while the onshore market grew by around 9%.
Australia has traditionally relied on its ability to attract students overseas and bring them into the country to begin their studies. That pipeline is now under pressure from visa settings, greater scrutiny and changing student preferences.
Meanwhile, students already in Australia are behaving differently.
Studymove estimates that around 52,000 students already in Australia progressed into higher education in the first half of the year. Of those, approximately 33,000 went to public universities and 18,000 to private providers. The important point is that the growth came from the private provider segment, while public university numbers were essentially flat.
Price is likely to be an important part of the story.
Studymove’s analysis puts the average international undergraduate university fee at around $42,000, compared with approximately $24,000 for non-university higher education providers.
For a student already living in Australia, that is a substantial difference.
The result is a market in which onshore students are increasingly making rational choices around price, location and progression. For universities, the onshore market cannot simply be treated as an easy replacement for lost offshore students.
It is a different market with different motivations and different price sensitivities.
Bachelor degrees are holding up while postgraduate demand weakens
There is another major change hiding in the numbers.
Postgraduate coursework is weakening, while bachelor demand is holding up.
Studymove found that bachelor commencements increased by around 7% in the first half of 2026. Engineering was particularly strong, increasing by 22%, while management and commerce grew by around 9%.
Postgraduate coursework, however, continued to decline, with management and commerce and information technology among the areas experiencing the greatest pressure.
This represents a significant change in the shape of Australia’s international education market.
Australian universities have built substantial international recruitment businesses around postgraduate students, particularly in business and IT. The Studymove data suggests that this segment is now considerably more vulnerable to the changing policy environment.
Bachelor students appear to be responding differently.
The reasons are not entirely clear from the presentation, but the pattern is difficult to ignore. Undergraduate demand is showing resilience across a range of disciplines, while the mature-age postgraduate market is contracting.
That should prompt universities to reconsider where they expect their future international growth to come from.
The days of assuming that another large cohort of international business and IT master’s students will arrive next year may be behind us.
Visa refusals likely to become an even bigger story
If the first three findings describe a market that is changing, the visa data points to a potential shock still working its way through the system.
Studymove has identified a significant increase in refusals for offshore higher education applicants, particularly from India, Nepal and Bangladesh.
The organisation estimates around 21,000 higher education student visas were refused between January and June, with the impact heavily concentrated in those three markets.
That concentration is important. This is not, at least yet, a uniform deterioration across every source market. But for institutions heavily exposed to India, Nepal or Bangladesh, the impact can be substantial.
Studymove estimates that if the current decline in visa grants continues, it could contribute to a further 8% decline in international commencements.
That would turn what is currently a relatively modest decline into something considerably more serious.
Ramirez also challenged the sector to look beyond published visa grant rates, arguing that the actual number of refusals provides a better indication of what is happening in the market.
There is also an uncomfortable question sitting underneath the numbers: what exactly is driving the increase in refusals?
The Australian Government has indicated that applications are being subject to greater scrutiny. Ramirez argues that greater clarity between government and the sector would be beneficial, particularly because the current pattern is highly concentrated in a small number of markets.
That is a reasonable call.
Students are now paying substantially more to apply for an Australian student visa. If they are refused, there is often limited information available to explain precisely what went wrong.
For the student, that can be devastating. For the provider, it can mean losing a student after months of recruitment and admissions work. For Australia, it creates a reputational problem.
Diversification doesn’t mean abandoning established markets
Another observation from Ramirez is his definition of diversification.
In international education, diversification has traditionally meant finding the next market: Africa, Latin America or another emerging destination.
Ramirez argues that the conversation needs to be more sophisticated.
If a university has become heavily dependent on one mature market, reducing that exposure can itself constitute diversification.
That is important as the volatility of the current environment means a previously reliable market can no longer be assumed to remain reliable. Policy settings can change. Visa refusal rates can change. Student preferences can change.
And they can change quickly.
The answer is not necessarily to abandon established markets and search for entirely new ones. It may simply mean building a broader student cohort within the markets and segments where an institution already has strong relationships.
That is a much more practical form of diversification.
It also requires the entire university to understand international recruitment as a strategic risk issue, rather than something that sits solely with the international office.
Australia may be trimming the tree, but it cannot forget the roots
Perhaps the most memorable part of the presentation came towards the end, when Ramirez used the metaphor of Australia “trimming the tree” of international education. A phrase used by The Hon Julian Hill sometime back in relation to saving the tree.
The Government has made it clear that international education sits within a broader national policy agenda encompassing migration, housing, infrastructure and the visitor economy.
The tree is being deliberately constrained.
But Ramirez’s point was that policymakers can see the branches and leaves of international education in the form of student numbers, visa grants and economic value, while sometimes forgetting about the roots.
Those roots are the relationships built between Australian institutions and international students over decades. They are the relationships with families, agents, schools and communities.
They are trust.
And trust is considerably harder to measure than commencements.
As Ramirez put it:
“We are not a commodity sector. We are a people sector.”
That is an important distinction at a time when international education policy is increasingly being managed through numbers.
A student is not simply a number in a NOSC allocation. A family is not simply a visa application. And Australia’s international reputation is not something that can simply be switched back on when the policy environment becomes more favourable.
The challenge for Australian international education is therefore becoming more nuanced.
The question is no longer simply whether Australia can continue attracting around 200,000 international higher education students.
It is what happens when that number becomes the ceiling rather than the floor.
Because if the cake is no longer growing, universities and institutions will fight harder for every slice.
You can view the Studymove analysis here:
