Notably, the VET sector saw a year-to-date 13% increase in commencements after a 5.9% increase in enrollments.

The boost spells good news for the sector considering a recent Students and Courses report released by the state-owned National Centre for Vocational Education Research (NCVER) revealed that overseas visa holders studying onshore in 2013 dropped 1.7% year-on-year at TAFE and government providers, multi-sector HE institutions, community providers and private providers.

Overseas visa students studying onshore in VET fell from 208,300 in 2009 to just 135,200 in 2013 despite continuing to represent one-quarter of all student visa holders in Australia.

The Department of Education’s May snapshot however shows a strong first half of 2014 with year-to-date enrolments reaching 95, 463 compared to 90,110 in May 2013 led by students from India and China.

Last year saw the country’s VET sector struggling with dwindling domestic numbers and a continuation of downward trend in international student numbers that started in 2009 when the automatic link between VET training and migrant rights was axed.

Stakeholders now attribute the fall between 2009 and 2013 to a mismatch between course costs and employment at home for the overseas cohort as well as diminishing government subsidies for VET providers.

Phil Honeywood, National Executive Director of the International Education Association of Australia (IEAA), suggested that economic factors have played a major role in deterring international students from onshore VET courses, as more providers move towards offshore delivery in collaboration with overseas partners.

“Since the nexus between studying a VET course in Australia and then qualifying for onshore migration was broken two years ago, the trend of VET enrolments has dramatically declined,” Honeywood told The PIE News.

“This is largely because if an international student pays high tuition fees in Australia for a VET qualification when they return to their home country they will never earn enough in the career related to their VET qualification to offset the costs of having studied abroad,” he explained.

The fall in international numbers last year contributed to the overall decline of the VET sector’s share of education exports from 18.4% to 16.5%, or $2.5 billion of total income, as yearly figures released in May by the Ministry of Education show.

“When they return to their home country they will never earn enough in the career related to their VET qualification”

However, revenue from education royalties increased 32% last year suggesting that offshore delivery could be recovering from the dip seen after a 2009 high and proving more profitable than onshore provision at this point.

Honeywood confirmed that many Australian providers have been focusing on “advanced technical skills training” tailored for employees of offshore corporations, which will often pay a premium to have VET skill enhancement courses embedded in their workplace.

Meanwhile, onshore providers are struggling with what Jennifer Westacott, Chief Executive of the Business Council of Australia, called “softening economic conditions” and blamed the decrease in government support for the decline in revenue from fee-paying students and the international student market for VET.

This, she said, contributes to the issue of “limited and inconsistent” funding levels, one of five areas of weakness she identifies in Australia’s VET system.

The government recently eliminated tuition fee caps and announced it would be slashing university and TAFE funding.