Australia’s peak retail bodies are warning that the Opposition government’s proposed cap on international students and increased visa costs could spell big trouble for the retail and hospitality workforce.

The Australian Retailers Association (ARA) and National Retail Association (NRA) have both expressed concern over the Federal Opposition’s plan to tighten migration settings. The proposal includes capping the number of international students coming to Australia and increasing student visa fees, with the aim of reducing net overseas migration. However, retail leaders say the move could seriously backfire for businesses already struggling to fill roles.

Students play a big role in retail

ARA’s Chief Industry Affairs Officer, Fleur Brown, said international students don’t just help keep shops and restaurants running, they’re also major contributors to the economy through tourism and spending.

“International students play a critical role in supporting part-time and casual roles, which are the backbone of dynamic trading environments like retail stores and restaurants,” Brown said.

She pointed out that job vacancies in the retail sector remain stubbornly high, with around 25,600 unfilled positions across the country.

“Retailers across the country are crying out for staff. This has a flow-on effect to all Australians in providing great service to customers. We should be sending positive signals to this essential workforce cohort – knowing it can take years to build a pipeline of students willing to travel to our shores,” she said.

Brown added that the ARA has long backed policies that support international student employment as one way to ease the labour crunch.

“Curtailing the ability of international students to work in Australia would undermine years of effort to make our country a destination of choice for education and employment.”

Retailers fear workforce setbacks

NRA Interim CEO Lindsay Carroll echoed the concerns, saying the retail and hospitality sectors are only just beginning to recover after COVID-19, and the timing couldn’t be worse.

“We understand the need for a balanced migration system, but limiting international student access will have ripple effects across the retail and hospitality workforce at a time when we simply can’t afford it,” Carroll said.

She warned that Aussie consumers would feel the impact too.

“Skills shortages in the sector make it challenging for retailers to keep delivering the high-standard of service they aim to provide to their customers,” she said.

And once the flow of students slows down, recovery doesn’t happen overnight.

“Rebuilding those pipelines takes years, and in the meantime, our shops, restaurants and cafes suffer,” Carroll said.

Both organisations are urging the government to consult with industry before making any big changes that could disrupt the already stretched retail workforce.

“We urge policymakers to consider the full economic impact of these proposals and to work collaboratively with industry to find balanced solutions that address concerns without compromising Australia’s recovery and growth,” Carroll said.

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