International graduates earn less than Australian peers
Published 14/02/2023
International graduates who stay and work in Australia earn lower salaries than their domestic counterparts, although the wage gap has reduced since 2021.
Non-Australians working full-time who studied undergraduate courses earned AUS$60,000 on average in 2022 compared to AUS$68,000 for Australians. The salary difference was less pronounced than in 2021, when the variation was AUS$10,700 between the two groups, according to the 2022 International Graduate Outcomes Survey.
The Department for Education funded research, which looked at student employment outcomes approximtely four to six months after graduation, found that studying at postgraduate coursework level did not boost earnings among international graduates, compared to those who took undergraduate courses.
In contrast, domestic students with postgraduate qualifications earned AUS$23,600 more on average.
Almost 60% of international students who took undergraduate courses in Australia were in full-time employment up to six months after graduation in 2022, but international students still experience much lower employment rates when looking for post-graduation work both inside and outside of Australia.
Almost 80% of domestic students who studied at undergraduate level were in full-time employment. Although the gap remained, as with salaries, the difference between the cohorts decreased in 2022.
Earlier research from Deakin University found an “education-job mismatch” among international graduates on temporary graduate visas in Australia, with many working in low-skilled jobs.
While some 63% of international undergraduates employed full-time were in managerial or professional occupations, 30% said they were working in a job that did not allow them to fully use their skills or education.
Ly Tran, professor at Deakin University, said that international graduates face structural barriers to skilled employment.
“Many employers are unclear about what the post-study or temporary graduate visa is,” Tran explained. “In addition, the temporary status of the post-study work (485) visa gives some employers a sense of uncertainty or hesitation of recruiting this cohort.
“Our research also shows that many Australian employers prefer candidates with permanent residency or citizenship, which disadvantages international graduates.
“Also, there are a range of employers’ misconceptions about international students and graduates and lack [of] understanding about the value of international graduates and their cross-border experiences, international networks, intercultural skills, transnational knowledge and their multilingual capabilities,” Tran added.
Overall, the survey shows a large increase in employment rates for all graduates as the Australian labour market continues to recover following the pandemic.
“These reports are timely reminders that a university education sets students up for bright and fulfilling futures, while returning substantial gains to the labour market and the Australian community,” said Universities Australia chief executive Catriona Jackson.
“Only 28% of international students stay and use their degrees here in Australia, yet today’s findings show the opportunities are ready and waiting to be embraced.
“We need more university-educated workers entering our workforce”
“After all, more than half of the one million jobs expected to be created in the next five years will require a university degree – so we need more university-educated workers entering our workforce, not less.”
International graduates who had returned to their homes or moved to another country were more likely to be in full-time employment than their peers who remained in Australia.
The survey found variation in employment rates across home countries, with 70% of those from Singapore in full-time employment compared to 52% of those from China and Sri Linka.
Employment rates also varied depending on subject choice, with international full-time employment rates reaching 97% for pharmacy graduates compared to 46% for psychology graduates.
Over three years, universities with highest full-time employment rates among their alumni included Avondale University (67%), James Cook University (59%) and the University of Queensland (56%).
International undergraduates from James Cook University had the highest full-time median salaries of AUS$75,300, followed by graduates from University of Newcastle at AUS$68,000.
Tran called for a greater understanding among Australia employers of the temporary work visa and the process of recruiting international graduates holding these visas.
“There should be [a] better coordinated approach involving education providers and different key stakeholders to tackle misperceptions and prejudices against international students and graduates in the Australian labour market,” she said.
“In the first place, statements such as ‘permanent residency/citizenship only’ or ‘must be PR or citizens’ should not be allowed in job ads.
“Educating and raising the international students’ awareness of the importance to develop employability earlier in their study program, of their study-work rights, strategies to navigate the labour market and also manage their expectations is equally important too.”
She added that universities should provide customised career support to international students to help them transition from education to work.
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