Census shows almost 30 per cent of temporary migrants were working as cleaners, carers, drivers, shop assistants

The ABS data drawn from the 2021 census, show that on census night there were 1.6 million temporary migrants in the country, including almost 100,000 in the skilled category and close to 364,000 international students.

Half of the temporary migrants were aged between 20 and 34 years, more than a third had at least a bachelor's degree (the proportion was 65 per cent among those on temporary skilled visas) and almost three-quarters were in the labour force.

But, despite their relatively high level of education, the ABS figures show many were in low-paid jobs. Almost 7 per cent worked as carers, almost 11 per cent were drivers or cleaners and close to 10 per cent were sales assistants or food workers.

The results echo the findings of the federal government's migration review which called the nation's migration system "broken".

The review found that the system was overly complex and bureaucratic and discouraged skilled workers, particularly those who had gained a degree from an Australian university, from transitioning into quality employment here.

Prime Minister Anthony Albanese said the migration review's findings were discussed at national cabinet on Friday.

"We know that in this country we have had a demand for everything from engineers to nurses to skilled workers, carpenters, bricklayers, people who have skills that are needed in the economy," Mr Albanese said.

"The idea that we don't provide a permanent pathway for those skilled workers that we need is quite frankly not serving our country's interest."

The budget is expected to show that net overseas migration has spiked in the past year to well about 235,000 people, raising concerns about the pressure on an already very tight housing market.

But the prime minister said it was being driven by a big influx of international students and reduced departures from Australia and the nation's population was "substantially" lower than it would have been because of the pandemic-driven border closures.

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Mr Albanese said permanent migration will actually be lower under the reforms to the migration system under consideration.

Releasing the review on Thursday, Home Affairs Minister Clare O'Neil said the system needed to be overhauled.

"Australia's migration system has become dominated by a very large, poorly designed, temporary program, which is not delivering the skills we need to tackle urgent national challenges," Ms O'Neil said.

In its initial response to the review, the government has announced it will increase the temporary skilled migration income threshold from $53,900 to $70,000 for applicants after July 1, after it had remained at 2013 levels for almost a decade.

It will also create a pathway for temporary skilled migration workers to become permanent residents as from the end of the year.