CHARLES Sturt University vice chancellor Andrew Vann believes changes to the structure of university fees and repayment will cause uncertainty for students and could have a major impact on rural communities.
The government released figures in last month's federal budget that showed a reduction in the estimate of graduates for 2016-17 who will gain employment within a third of a year from 78 per cent to 70 per cent.
If accurate, almost 65,000 students will still be looking for work four months after completing their degrees, 17,000 more than predicted at the same time last year.
Professor Vann said he was less concerned with estimates and more concerned about the number of people who could be driven away from tertiary education by the higher costs.
The changes the government plans to introduce will drive up the amount most students have to borrow to complete their studies through fee deregulation and they will be hit by higher interest rates when they pay their HECS loan off.
"These are uncertain times. None of us know what is going to happen in the future and the changes in the federal budget probably haven't helped that," Professor Vann said.
"Our concern is the impact on communities and economies as well as the students if people are priced out of education.
"We accept that the government has tough decisions to make but we see education as an investment for the future and our concern is that it could move out of the reach of some."
CSU has remained well above the average for graduates who find employment within four months.
In 2008 90.2 per cent of graduates seeking full time employment had found it within a third of a year.
There has been a steady decline but last year the figure was still at 81.1 per cent.
The majority of those not working full-time did have part time employment.
Professor Vann said CSU prided itself on providing graduates that meet the needs of communities.
He said 75-80 per cent of on-campus graduates choose to remain in regional areas after they finish their study, keeping skilled labour in the bush.
Figures from Universities Australia showed students could take an extra 10-15 years to pay off their HECS debts after the changes take place, eating into their wages for significantly longer than the previous scheme.
"In the past, we saw the loans really were paid off very quickly but now it is going to drag on longer and going to eat significantly into the disposable income of graduates," Professor Vann said.