Australian universities have called for a "hard reset" of the visa process for international graduates.

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Universities Australia chief executive Catriona Jackson said there are currently more than 100 visa subclasses, describing the system as not fit for purpose.

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According to Universities Australia, less than a third of international graduates use their post-study work permits and only 16 per cent become permanent residents.

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competitors are increasing the number of international graduates in their migration mix in recognition of the significant contribution they make. Australia is falling behind."

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granting temporary visas to all international students who graduate from Australian universities and upgrading reporting processes to provide applicants with up-to-date information on their visa status.