Australia’s limited work, rising prices hit international students

An, a 19-year-old student at Kaplan Business School who also works part-time at a fast-food franchise, is experiencing financial strain due to reduced working hours. This comes as the Australian government reinstated a limit on the number of hours international students are allowed to work, amidst escalating living costs.

Used to clocking 22 hours a week of work, An can no longer secure the number of shifts she needs to stay afloat, a struggle that is pitting her reduced income against Australia’s currently soaring prices for daily goods and life expenditures.

She now averages 18 hours of work per week, An said, noting that the reduction has necessitated significant changes in her spending habits.

"I’ve switched to shopping at Vietnamese markets for their lower prices," she explained to VnExpress International. "In general, I seldom purchase new items and avoid spending on non-essentials."

An is not the only international student affected by the recent amendment. With a reduction in working hours for international students, Riya Kattady, a Master’s student in engineering at Western Sydney University, told The Guardian, that she now makes her coffee at home as "takeaway has become a luxury" due to her decreased earnings.

"I have to think twice about my spending now," she explained. "I can’t just work extra hours ... I have to save and plan things."

The Australian Department of Home Affairs implemented a policy restricting international students to a maximum of 48 working hours every fortnight during academic terms, effective from July 1, 2023. This marked a significant change from the previous policy that allowed unrestricted working hours during the pandemic.

Compounding the challenges faced by working international students is their susceptibility to being underpaid. According to a 2023 Grattan Institute report cited by the Australian Broadcasting Corporation, one in six migrants receives wages below the national minimum.

Grattan Institute economist Brendan Coates said international students fell under that category and were more likely to be underpaid because, often, they were younger. "They're vulnerable to underpayment because of the fortnightly cap on their hours," he said.

The report specifies that 5-16% of newly arrived migrant workers are compensated less than the adult minimum wage of 21.38 Australian dollars (US$13.93) per hour. Additionally, 1.5-8% of these recent migrants are underpaid by at least three dollars an hour.

A survey cited by Times Higher Education, which involved over 6,000 participants and was part of a government-supported project led by Ly Tran, a researcher in international education at Deakin University in Australia, found that 45% of respondents wished to work more than 48 hours every fortnight.

Breaking down the numbers, 27% preferred no restrictions on work hours, 11% proposed a limit of 50 hours, and 7% supported a cap of 60 hours.

"They want the freedom to decide," Tran said.

The imposition of a working hour cap, combined with rising costs for rentals, groceries, and public transportation, highlights the broader challenges faced by international students.

The Consumer Price Index in Australia rose 4.1% in 2023, according to an Australian Bureau of Statistics report released in January.

The Australian Broadcasting Corporation reported that Michelle Marquardt, the head of price statistics at the Australian Statistics Bureau, identified the main drivers of inflation as housing (up 4.6%) and food and non-alcoholic beverages (up 4.4%).

However, some individuals, such as Yeganeh Soltanpour, the president of the Council of International Students Australia, are in favor of the limit on working hours. Speaking to the Sydney Morning Herald, she argued that the previous absence of a cap on work hours resulted in students missing classes and failing their courses due to the overwhelming demands of work.

Minh Hang, a 25-year-old psychology trainee in Melbourne, also commended this policy for encouraging students to focus more on their studies, as she believes that the restriction on working hours supports her in dedicating the necessary time to her demanding studies towards her degree.

Still, despite recognizing the potential benefits of the reduced working hours limit, Hang found herself relocating to a more affordable area away from the city center.

Local authorities have implemented various strategies to address some among the challenges above. For example, in an effort to counter inflation, the Reserve Bank of Australia (RBA) increased interest rates to a 12-year peak of 4.35% in July 2023, aiming to keep inflation within the 2-3% target range, according to The Guardian.

Reuters reported that Prime Minister Anthony Albanese, in January, announced that his government is exploring new measures to alleviate cost-of-living pressures ahead of the upcoming May budget without exacerbating inflation.

"We asked them [Treasury and Finance] to give consideration to what are the measures that can take pressure off families on cost-of-living without putting pressure on inflation," Albanese stated during a Sydney press briefing.

As both authorities and foreign students navigate the present challenges, the 645,516 international students in Australia - a number reported by ICEF Monitor as of Aug. 2023 - must continue to persevere.

"I think my future is really looming over me,"An expressed her concerns about the future. "With the high cost of living, I’m uncertain if I can afford to stay and finish my degree."