Australia’s major cities are undergoing significant demographic change driven by fewer births and growing immigration. In wealthier inner suburbs, fewer children are being born locally, while new migrant families are contributing to population growth in outer areas. This is putting pressure on both public and private schools to expand quickly.
As wealth increases in high-fee school areas, particularly in parts of Sydney, Melbourne, Brisbane and Perth, demand from affluent professional families is also rising. Fertility rates in these areas have dropped to as low as 0.79 children per woman in 2024. As a result, private schools are increasingly dependent on international student enrolments to maintain population stability. With limited options for expansion within inner suburbs, many schools are now moving into nearby less affluent areas, which are already facing their own pressures from housing shortages and inadequate infrastructure.
These shifts are creating financial pressure. Non-government schools are dealing with rising costs due to government funding models and required wage increases for teachers. Some schools are expecting fee hikes of more than 5% in 2026. Meanwhile, the number of school-age students in inner suburbs is projected to decline, forcing schools to look for new enrolments in rapidly growing outer areas.
Since the reopening of international borders after COVID, net overseas migration has risen significantly, now making up nearly 80% of Australia’s population growth. Many newly arrived families from Indo-Pacific regions are living in outer suburban areas, often repaying mortgages while working several jobs. These families commonly prioritise private education, even as public services in those suburbs struggle to keep up with demand.
Private schools now face a dual challenge. They must build new campuses rapidly in growth zones on the outskirts, while also dealing with declining enrolment potential in their traditional inner-city locations. This could result in some existing schools with ageing infrastructure and falling student numbers needing to merge or close in coming years.
Australia’s education infrastructure is not well aligned with these shifting population trends. Continued urban expansion is clashing with planning restrictions, especially in established affluent areas. Unless national strategies on fertility, migration and productivity are strengthened, rising pressure on parents and school fees is set to continue.
