Arrivals of international students and backpackers fell by more than 99% last year, says CBRE’s Raymond Tran and Rosie Young. How do we fill the employment gap and how do accommodation providers adapt?
While Australia’s economy is emerging from the COVID-19 in far better shape than most of our international counterparts, there is no longer a large pool of international students able to balance their studies with 40 hours of work each fortnight.
Border closures have also prevented backpackers from 44 countries with working holiday visa rights from arriving on our shores – and these travellers make up a large chunk of our casual workforce. 
In March 2021, there were just 230 temporary student visa arrivals and 160 temporary work visa arrivals across the whole of Australia. This represents a decline of 99.7 per cent and 99.3 per cent, respectively, year-on-year.
This is against a backdrop in which job advertisements are running at a 12-year high. Latest data from the Australian Bureau of Statistics confirms a 13.7 per cent increase in job advertisements in February 2021 alone.
CBRE Hotels director Rosie Young says up to one in four workers in some industries – notably hospitality and agriculture – were foreign students, backpackers or transient international visitors prior to COVID-19.
“Everyone accepts the difficult balancing act that state and federal leaders face to ensure that COVID related health risks are mitigated. But there is an increasing urgency to address the acute skilled and unskilled labour shortages that threaten Australia’s continued economic recovery,” Young says.
The New South Wales Treasury has estimated that it costs the state $1.5 billion each month that international borders remain closed.
Signs of a “green shoots recovery” in the tourism and hospitality sectors, supported by half-price airline tickets for domestic visitors, have been counterbalanced by growing skills shortages in capital cities and regional areas.
CBRE Hotels director Raymond Tran says tourism and hospitality are not the only sectors feeling the pain. “The agriculture industry – ranging from fruit picking in Coffs Harbour through to the fishery greenhorns in Australia’s seafood capital of Port Lincoln – is also feeling the pinch.”
Many of the job roles that were once a “magnet for young, nomadic millennials prepared to take on less desirable, low-income work” are now a topic of national importance, Tran adds.
Tran and Young point to recent charter flights of Pacific Islanders brought in to address the shortage of fruit pickers. The resources sector in Western Australia is also struggling to fill semi-skilled, unskilled and skilled labour roles, particularly in regional locations.
“Beyond their labour, these workers and their ancillary spending in regional towns – be it at the local youth hostel or on the $5 coffee and muffin combo deal from the local café – have played a critical role in keeping the wheels of Australia’s economic engine turning,” Tran says.
Without prompt action, there is a risk that Australia will lose out to more proactive countries in the fight for labour, Tran adds. New Zealand recently raised the number of hours those on working holiday visas could work from 20 to 40 hours a week.
Amid these challenges, there is also a need for industries that house and support Australia’s transient worker population to adapt.
The number of new international students at Australian universities has nearly halved since the pandemic, with 43,000 fewer international students enrolled at Australian universities compared with last year.
In the purpose-built student accommodation (PBSA) sphere, operators continue to lobby state and federal governments to temporarily offer existing properties to non-students or as hotel quarantine.
“The NSW Government is now calling for PBSA operators with suitable quarantine capabilities to be able to handle a volume of 600 rooms weekly,” Young says.
Owners and operators of youth hostels, student accommodation and co-living properties are also looking at innovative solutions to ensure their properties remain functionally and economically viable, Young adds.
The new partnership between YHA Australia and Atlassian is one example. This will see YHA restore its heritage-listed backpacker hostel at the former Inwards Parcel Shed at Sydney’s Central Station. Nearly 500 beds will accommodate “digital nomads” drawn to the dynamic tech hub.
“Projects like this have the potential to accommodate Australia’s next generation of innovators and tech talent, creating Sydney’s own post-COVID, Silicon Valley,” Tran concludes.