Population to reach 30m two years later than expected before pandemic

Australia’s population will reach 30 million two years later than predicted before COVID-19 due to fewer immigrants during the pandemic and the birth rate continuing to fall.

An excerpt from the federal government’s annual population report shows that in 2020-21, the first full financial year of the pandemic, the population grew by just 0.1 per cent, or 33,000 people.

The report said the population was on track to be 1.2 million smaller by June 2031 than forecast in the mid-year economic outlook for 2019-20.Credit:Flavio Brancaleone

The Centre for Population expects it to have grown to 26 million over 2021-22 and to 26.3 million by the end of this financial year – about 600,000 lower than its pre-COVID forecast.

The report said the population was on track to be 1.2 million smaller by June 2031 than forecast in the mid-year economic outlook for 2019-20.

About 30 per cent of the shortfall was due to lower net migration after COVID-19 border closures, with the rest from a lower assumed fertility rate and fewer births attributed to migrants.

The report predicts the population will now reach 29.9 million in 2032-33, a full two years later than the centre’s pre-pandemic forecasts.

The Australian population is also continuing to age. Despite a pandemic bump to the fertility rate, a long-run decline in the number of babies born and a continually increasing life span will lift the median age by 1.5 years to 40.1 by 2032-22.

Last financial year, the median age was 38.6, and by 2024-25 it is expected to reach 39.

Treasurer Jim Chalmers said the report highlighted the pandemic’s impact on the population.

“Australia’s population … is now expected to be slightly smaller and older than it otherwise would be,” he said.

The natural increase in population – the number of births a year, minus the number of deaths – is forecast to reach 134,000 by June 2024 before falling to 117,000 by mid-2033. Net overseas migration is expected to reach 235,000 this financial year and remain at that level.

Peter McDonald, a professor of demography at the University of Melbourne, said Australia’s migration intake had a big impact on the ageing of the population.

“Currently in the Australian population, about 17 per cent are aged 65 and over. Going out 40 years to 2061, without migration, that number would go to about 31 per cent. With migration of about 200,000 a year, which is where we’ve been in recent times, it only goes to 23 per cent,” he said.

“Migration makes a very, very substantial difference to population ageing, and that’s because the migrants are young, and they have their children and their grandchildren before they themselves get old.”

In the short run, McDonald said migrants also helped fill the demand for labour, but competition on that front would get harder as countries around the world fought to attract skilled workers amid shortages in sectors including teaching and accounting.

Chalmers said migration would be an important part of the country’s story into the future but was not a substitute for training more Australians. A panel of experts is currently reviewing the immigration system and will hand a report to the government next month.

“Migration policy is economic policy and that’s why we are working closely with relevant ministers to get it right,” Chalmers said.

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