CONCRETE DETAIL
by Christopher Joye
Posted 18 Sep 2009 2:40 PM
Are we ready for this population explosion?
So the front pages of The Oz and The AFR reported today that the Treasury has significantly revised upwards its forecasts for Australia’s population growth over the next circa 40 years. This will not be a surprise to regular readers. The change in the Treasury’s projections disclosed by Wayne Swan, and the absolute estimates of Australia’s population in 40 years’ hence, are nearly identical to those previously released by the ABS late last year (and regularly highlighted here). They basically mean that Sydney and Melbourne will likely have 7-8 million residents by 2050-60.
This begs the question as to where we are going to house all these people and the enormous new infrastructure investments that will be required to support a national population more than one and a half times its current size.
To quote Wayne Swan:
“Our projections suggest that Australia's population could be larger and younger than presented in previous IGR projections. In addition to those stats…I can also tell you today that Australia's population is projected to grow by 65 per cent to reach over 35 million people in 2049, up from around 21˝ million people now. This projection of 35 million people is significantly higher than the IGR2 projection of 28.5 million in 2047 and is largely driven by a greater number of women of child-bearing age, higher fertility rates, and increased net overseas migration.
The total fertility rate of Australian women has increased to over 1.9 births per woman in recent years. This is a level of fertility not seen in Australia since the early 1980s, although it is still a long way off the peak of 3.5 births per woman at the end of the post World War II baby boom.
Net overseas migration is also an important contributor to population growth in Australia. Migrants to Australia tend to be younger on average than the resident population, and in combination with a higher net migrant intake, contribute to the projected larger and younger Australian population.
The larger projected population poses a whole raft of policy challenges and opportunities quite apart from the age structure. Careful environmental and infrastructure planning will be required to support this population. But when we get it right, population growth can be an important contributor to the overall economic well-being of Australians.”
I have written about the profound policy consequences of Australia’s booming population (based on the ABS changes in 2008), which is growing at the fastest rate in the developed world, on numerous occasions now. In 2008 the ABS lifted its 2051 estimates from 28.2m persons (in 2004) to 34.2m persons based on the “Series B” projections (see below). In my January 2009 posting on this subject, I also commented:
“There is another major and rarely commented on curve-ball here that demographers have yet to get their heads around: longevity risk… What happens if we start living longer? Current population projections are based on relatively crude life expectancy estimates that do not accommodate significant non-linear changes in longevity that could be caused by medical breakthroughs. And the probability of such events is presumably far higher since we started decoding the human genome.”
Source: ABS
Contrast Australia’s position with Japan – which is what associate professor Steve Keen loves to do (abetted by an unquestioning media) – and you discover at least one critical difference between our two nations. Japan’s population growth has been falling since the 1970s and turned negative in the noughties. In fact, as I noted in January, the Japanese government is forecasting that Japan’s population will shrink by 27 per cent come 2050. In comparison, Australia population is set to rise by 65 per cent based on the Treasury’s latest guesstimates.
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