Net overseas migration and population growth slow to four-year low in early 2026

Australia’s net overseas migration rate has fallen below 300,000 for the first time in four years with industry groups warning a population growth slowdown and a crackdown on work visas will worsen the skills shortage.

The net overseas migration rate moderated to 292,100 in the year to the end of March, down from last year’s pace of 301,000 and marking the lowest level of permanent and long-term foreign arrivals, of at least 12 months, since the June quarter of 2022.

This occurred as Australia’s population growth pace slowed to a four-year low of 1.43 per cent, down from 1.46 per cent during the December quarter, and a far cry from 2.53 per cent in 2023 that was the highest since 1952.

New overseas arrivals, however, still averaged 800 a day and made up 74.4 per cent of Australia’s total annual net population growth of 392,700 covering births, deaths and those leaving Australia for good.

With the Federal Government scaling back work visas and introducing a new lottery system for temporary arrivals, Accommodation Australia chief executive James Goodwin warned this would worsen a chronic skills shortage.

“It is ridiculous that a skilled occupation like a chef can take up to 12 months to process — there are 7000 chef and cook vacancies in Australia right now,” he said.

“It will now be harder for hotels to access the workers we need and the changes will increase competition in an already tight labour market.”

The States with the biggest influx of interstate rather than overseas arrivals had the fastest population growth.

Western Australia continued to have Australia’s highest annual population growth pace of 2.1 per cent with 10,314 moving there from interstate, on a net basis, as 41,531 moved in from another country.

The mining-rich State had even stronger growth than Queensland’s 1.6 per cent population pace based on 14,718 net interstate arrivals and 55,217 from overseas.

NSW took in the highest number of net overseas arrivals, at 84,573, but with 20,818 moving interstate, the State that is home to Australia’s most expensive housing market, Sydney, had a below-average population growth pace of 1.1 per cent.

Victoria, home to Australia’s most affordable big city property market Melbourne, had an above-average population growth pace of 1.6 per cent based on the second highest net overseas arrivals rate of 81,732 and a neutral net interstate arrivals pace of just 82 new residents.

South Australia had a particularly weak population growth pace of 1 per cent with 1208 leaving for another State of Australia as 17,406 came from abroad.

The Northern Territory had an above-average population growth level of 1.5 per cent despite an interstate departure rate of 1589 because the net overseas migration intake of 3585 was more than double the exodus to another part of Australia.

Tasmania had Australia’s weakest population growth of 0.6 per cent with a natural increase of just 245 newborns, compared with 3247 net overseas arrivals and a net interstate departure rate of 98.

The Australian Bureau of Statistics data was released ahead of Home Affairs Minister Tony Burke announcing new measures to curb temporary immigration levels at the National Press Club in Canberra, with the May Budget promising net overseas migration would fall to 245,000 this financial year before dropping to 225,000.

Those levels would be half the record-high 548,800 level in the year to September 2023.

While permanent migration including skilled migrants and family reunions is capped at 185,000, the temporary cohort isn’t, which covers the long-term intake of international students and those on a working holiday visa.

Mr Burke last month confirmed the Government would prioritise on-shore applications for working holiday maker visas and on Thursday announced a regional work requirement that was absent during an updated UK-Australia free trade agreement that came into effect in 2024.

A lottery system is also being introduced for temporary migrants in the second and third year in a bid to boost labour for fruit picking and harvesting.

“Working holiday maker processing is now being restored,” he said.

“The more tools and levers that are available, the more sharply I can target the system to be able to slow down to get housing in front and to minimise the impact on the Australian economy.

“We need immigration: we just need to make sure that it is targeted for the needs of Australia in numbers and across the different categories that work for our economy.”

Shadow housing minister Andrew Bragg said the temporary arrivals figure was still too high during a housing shortage, with net overseas migration still well above the 170,000 annual building completions rate, which is the basis of a likely Coalition policy on net overseas migration.

“Well, people aren’t stupid. They know that we have too many temporary migrants, and they know that we need more skilled migrants,” he told News24 on Thursday.

“So part of this is recalibrating and getting more high-value people into the country. In the building and housing sector, we are desperately in need of tradies to help us build homes, because we can’t get enough apprentices through the Australian system.”

Lendi Group chief executive Sebastian Watkins, the leader of Australia’s biggest mortgage broking group, said high immigration levels after COVID had caused the housing shortage crisis.

“We can’t even build enough houses in Australia as it is and we’re just compounding the issue by bringing in record net immigration,” he told The Nightly.