Australian universities’ latest round of job-shedding could put an end to cycles of expansion and contraction, with the sector set to downsize despite the Universities Accord imperative to grow.

The University of Southern Queensland, one of at least eight Australian institutions preparing to shed staff, has proposed dozens of job cuts to address a A$30 million (£15 million) deficit. “We’re not the worst affected by a long shot,” said outgoing vice-chancellor Geraldine Mackenzie. “Many of us…will necessarily be smaller. If you have fewer students, you need a smaller university.”

Nous Group consultant Zac Ashkanasy said universities had committed an “own goal” by hiring too many staff after the coronavirus pandemic, assuming that they would have “unfettered” access to international students.

Market conditions for higher education will remain volatile, he warned. “The need to have really mature financial management and cost controls in place is going to be paramount.”

����Vlog

The University of Technology Sydney (UTS) has said “a significant number” of job losses will be required to achieve its A$100 million savings target. Vice-chancellor Andrew Parfitt agreed that administrators had grown too eagerly after Covid, but said this was understandable.

UTS, for example, had “strategically planned deficits for a number of years” following the border closures. “For many people, Covid is in the rearview mirror. For universities, the pipelines are long. We were essentially staging through two more years of post-Covid recovery. [Now] we have to get out of deficit much quicker than we’d originally thought,” Professor Parfitt said.

����Vlog

“On the one hand, we want a stronger university sector to grow our domestic student numbers. On the other hand, we’re not prepared to accept that international education is a big source of supporting revenue. It’s a funny world.”

The sector’s financial woes have largely been blamed on international education policy changes, but many other factors have contributed. Soaring inflation has increased the costs of salaries, equipment and consumables. Domestic enrolments have been suppressed in a buoyant labour market. Increased reporting, compliance and research quality requirements have added to universities’ costs, and funding changes in 2021 reduced overall per-student revenue.

Nick Harrigan, National Tertiary Education Union (NTEU) branch president at Macquarie University – where he estimates 300 arts academics’ jobs are threatened by a clampdown on casual appointments – said vice-chancellors had been disillusioned by the failure of Labor, considered naturally sympathetic to universities, to boost their funding.

“[It] has prompted managements to…prepare for rough waters [and] go for these cost-cutting exercises,” Dr Harrigan said.

����Vlog

But critics said universities had exacerbated their problems through lavish spending on executive salaries and consultants and ambitious expansion projects such as Monash University’s and Griffith University’s acquisition of Brisbane’s .

The Australian National University, which has already flagged about 150 job losses, last year devoted 25 per cent of its air travel expenditure to , covering 7 per cent of flights. The institution expects to spend A$44 million on travel this year, up from A$29 million in 2022.

James Cook University (JCU) NTEU president Jonathon Strauss, whose job is among scores targeted under restructure proposals, said universities should address their financial problems by hiring more staff so that they can accommodate more students. He said JCU’s domestic student load had increased this year, yet the university was sacking marketing and support staff.

Vice-chancellor Simon Biggs said students were taking on more subjects under JCU’s new calendar. “Total enrolments actually decreased in 2024.” He said the restructures were aimed at “removing duplication” and boosting efficiency.

����Vlog

Southern Cross University vice-chancellor Tyrone Carlin said universities were subject to “extraordinary” policy volatility. He cited uncertainty over the removal of ministerial direction 107, a visa-processing intervention tipped to cost the sector 14,000 jobs. “Will it lift? Won’t it lift? Will it lift in time that it makes a meaningful difference? We don’t know.”

john.ross@timeshighereducation.com