Net migration

IBISWorld expects net migration to decline by 195,200 people in 2024-25, to 239.9 thousand people. The anticipated decline in net migration can be attributed to falling migrant arrivals and rising departures, as highlighted by recent ABS data. After a period of record net overseas migration following the reopening of Australia's borders post-pandemic, the 2023–24 financial year marked the first annual decrease in net migration since 2021–22. This shift has been driven by a 10% drop in migrant arrivals, particularly among temporary visa holders and an 8% increase in migrant departures, reflecting tightening policy measures and changing international mobility trends, as noted by ABS.

This moderation in net migration is also influenced by evolving government policy and public sentiment. With migration becoming a key political issue in the recent Federal Election, both major parties advocated for lower or the same migration levels to address concerns around housing, infrastructure and labour market pressures.According to ABS data, net overseas migration is expected to fall to 446,000 in 2023–24, down from a record 536,000 in 2022–23. This decline reflects policy adjustments introduced during 2023–24, including heightened English language requirements for student visas and a 2.5% reduction in the permanent Migration Program planning level. They're expected to continue downwards as the government implements further restrictions and tighter eligibility criteria for temporary and permanent visas.

According to Treasury data, the decline in net migration is expected to bring Australia closer to pre-pandemic migration patterns, where annual net migration typically ranged between 225,000 and 230,000 people. This adjustment has implications for population growth, labour supply and economic activity, particularly in sectors reliant on migrant workers. As the migration intake normalises, policymakers and businesses must adapt to a slower pace of population growth and consider strategies to address potential skill shortages and demographic challenges.

Despite the anticipated decline in net migration, Australia remains highly attractive to migrants because of its robust economy and high quality of life. The country offers strong employment opportunities across diverse sectors and a high standard of living. Overall, IBISWorld forecasts net migration to rise at an average annual rate of 9,400 people over the five years through 2024-25.