For graduates dreaming of taking their education overseas, choosing where to study is about much more than finding a university with a good reputation. Career opportunities, living costs, visa requirements and the chance to build a future abroad all play an important part.

And increasingly, Australia may be losing out.

Once one of the world's most attractive destinations for international students, Australia's appeal has fallen by almost 25% in just six months. According to the latest Emerging Futures research by IDP Education, only 24% of prospective international students now name Australia as their first-choice destination.

While the country remains the most widely considered option, competition is hotting up. The United States and the United Kingdom are gaining ground, with the proportion of students considering either destination rising by eight percentage points between March and August 2026.

Australia's international student policy rating has also slipped, falling from 6.6 to 6.3. It was the only one of the leading study destinations to record a decline, suggesting that uncertainty around its approach to international education is beginning to influence student decisions.

Why are international students looking elsewhere?

For anyone considering studying abroad, confidence in a country's education system and immigration policies can be just as important as the course itself.

Simon Emmett, chief partner officer at IDP Education, said Australia's declining rating was no surprise, pointing to the impact of frequent changes to its rules.

“This is a clear sign that constant rule changes are weighing on students’ decisions.”

The findings highlight how much the international education landscape has changed. More than four in five prospective students are now considering several countries before making a decision, giving them greater choice than ever when it comes to finding the right place to study.

Emmett believes Australia needs to recognise the scale of the challenge and take action if it wants to remain competitive.

“The world’s best students have more choice than ever, and right now, Australia is making itself harder to choose. As a result, we’re losing ground in the global race for talent – and the skills and expertise that those students can then contribute to the country,” he said.

The bigger picture: international graduates and Australia's skills gap

The issue extends well beyond university enrolments. International students also represent an important source of skilled talent for countries looking to fill gaps in their workforces.

Australia continues to face shortages across several key industries, including science, energy and healthcare. More than half of its university-qualified STEM workforce was born overseas, highlighting just how significant international talent has become to the country's economy.

With demand for skilled professionals continuing to grow, attracting overseas students and giving them confidence to build careers in Australia could prove increasingly important.

However, changing government policies and political rhetoric risk weakening a sector that has been one of the country's major success stories over the past 50 years. Greater cooperation between governments, universities and industry partners will be essential to maintaining a strong, reliable and internationally competitive education system.

Visas, work opportunities and living costs are shaping decisions

For graduates weighing up their options, choosing a study destination involves looking beyond the classroom and considering what life will be like after graduation.

IDP Education's research shows that visa approval prospects, policy stability and certainty around post-study work opportunities are increasingly influencing decisions from the earliest stages of the student journey.

More than half of prospective students and those who have already applied said the likelihood of securing a visa had a significant influence on their choice of destination.

The financial side of studying overseas is another major consideration. The proportion of students who are no longer considering international education has increased from 11% to 16% since IDP Education's previous survey.

Australia faces particular challenges when it comes to affordability. One in four students who named the country as their preferred destination said the cost of living was their biggest concern – the highest proportion among the four leading study destinations.

For students already facing tuition fees, accommodation costs and everyday expenses, the overall financial commitment can make a significant difference when deciding where to study.

Is transnational education becoming a more attractive alternative?

As the cost of studying overseas continues to rise, students are increasingly exploring other ways to gain an international qualification without necessarily relocating.

Transnational education (TNE) is emerging as one such option, offering students the opportunity to access an international education through programmes delivered across national borders.

Affordability is a major part of its appeal. More than half of those surveyed (52%) said reducing the overall cost was their main reason for considering TNE.

For graduates looking to broaden their qualifications and improve their career prospects, this could provide an alternative route to an international education while helping to keep expenses under control.

What does this mean for the future of international education?

The message from the latest research is clear: international students have more choice, and destinations can no longer rely on their reputation alone to attract them.

Competitive universities, attractive career opportunities and high-quality courses remain important, but students also want clear visa pathways, stable policies, affordable living costs and confidence about their prospects after graduation.

For Australia, reversing the decline in its appeal will mean addressing these concerns and rebuilding confidence among prospective students.

The findings are based on responses from 4,834 students across 106 countries, collected between 18 August and 16 September 2026, as part of IDP Education's Emerging Futures research.

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