New research from the e61 Institute shows that extending post-study work rights (PSWRs) boosts international student enrolments and encourages graduates to stay in Australia temporarily - but does little to improve their job prospects or chances of permanent residency.
The study analyses Australia's 2013 reforms to the Temporary Graduate Visa, which extended post-study work rights from 18 months to up to four years for university graduates.
Following the change, international student enrolments in university programs eligible for the extended work rights rose by 27% - from around 110,000 to 140,000.
"Giving international students more time to work in Australia after graduation is clearly a powerful drawcard," said Silvia Griselda, Research Manager at the e61 Institute and lead author of the study. "But staying longer doesn't necessarily lead to staying for good - or to securing better jobs."
Using comprehensive administrative data, the study finds:
Graduates with longer PSWRs were significantly more likely to remain in Australia immediately after graduation - staying, on average, 140 days longer than their earlier counterparts.
However, they did not experience higher earnings or better-quality jobs.
And they were less likely to obtain permanent residency within three years.
"Longer work rights may actually reduce the likelihood of obtaining permanent residency, likely due to greater competition for a fixed number of PR places," said report co-author Harshit Shah, PhD Intern at e61.
"If these visas are intended as a bridge to permanent settlement for high-potential international graduates, expanding temporary work rights without increasing permanent migration places may be counterproductive."
Dr Griselda added: "If international graduates are seen as a policy lever to boost labour force participation and productivity, visa settings need to support their long-term integration into Australia's workforce and society.
"Without efficient pathways to permanent residency, longer work rights may simply extend uncertainty - with limited benefits for graduates or the broader economy."
