Fact Sheet 15 - Population Projections

At 31 March 2010, the estimated Australian resident population was 22.272 million people. This represented an annual increase of 403 100 people. Australia's population grew by 1.8 per cent during the 12 months preceding 31 March 2010 and the growth rate has been declining since the peak of 2.2 per cent for the 2008 calendar year.

Estimating population growth

Based on the following series of assumptions about Australia's future fertility, life expectancy and net overseas migration, Australia's population is projected by the Australian Bureau of Statistics (ABS) to grow to between 30.9 million and 42.5 million in 2056. Under the ABS medium (Series B) assumptions, Australia's population will increase from 35.5 million in 2056 to 44.7 million in 2101.

MAIN PROJECTION SERIES, Australia
	ASSUMPTIONS				PROJECTED POPULATION AT 30 JUNE
			Life expectancy at birth(a)
	Total fertility rate(b)	Net overseas migration(c)	Males	Females	2056	2101
	babies per woman	persons	years	years	million	million
Series A	2.0	220 000	93.9	96.1	42.5	62.2
Series B	1.8	180 000	85.0	88.0	35.5	44.7
Series C	1.6	140 000	85.0	88.0	30.9	33.7
(a) From 2056.
(b) From 2021.
(c) From 2010-11 in Series A and C. From 2007-08 in Series B.

Source: Population Projections, Australia 2006 to 2101 (ABS Cat. 3222.0)

 

The effect of these assumptions on Australia’s estimated population is shown below.

Source: Population Projections, Australia 2006 to 2101 (ABS Cat. 3222.0)

 

In series C, a state of natural decrease, in which deaths outnumber births, is not reached until 2048, with modest growths in population being achieved until this time. However, net overseas migration more than compensates for losses due to natural decrease and Australia's population continues to increase, albeit slowly, throughout the projection period. A state of natural decrease is also reached in Series B, but only in the last year of the projection-2101.

Components of population growth

The growth of Australia's population has two components: natural increase (the number of births minus the number of deaths) and net overseas migration (NOM). Natural increase and net overseas migration contributed 40 per cent and 60 per cent respectively to total population growth in the 12 months to 31 March 2010.

Source: ABS Australian Demographic Statistics 3101.0 (2010).

Fertility

Australia's total fertility rate (TFR), the average number of children a woman would bear over her lifetime, fell sharply from 3.6 children per woman in 1961 to 1.9 in 1979 and continued to fall steadily for the next 20 years. In 2002-03 it reached a low of 1.72 children per woman. Since then, it has increased, and in 2008 Australia's TFR was 1.978 babies per woman, the highest level since 1977 when the TFR was 2.007.

Even though the total fertility rate has recently risen to 1.978 births per woman, it remains below replacement levels of 2.1 births per woman.

Few developed countries have a fertility rate as high as Australia, the USA being the most notable exception with a TFR around the replacement rate of 2.1, and New Zealand with a replacement rate of 2.

Life expectancy

Life expectancy in Australia has increased significantly over the last five decades. Since 1960-61, life expectancy at birth has improved by 11.3 years for males and 9.5 years for females. Based on current mortality rates, a boy born in 2008 can expect to live 79.2 years (up 0.3 per cent from 2007) while a girl can expect to live 83.7 years (unchanged since 2007).

Net overseas migration (NOM)

Net overseas migration (NOM) is the net gain or loss of population through immigration to Australia and emigration from Australia.

Overseas travellers are included in the population if they are in Australia for 12 months or more, during a 16 month period. Conversely, overseas travellers are subtracted from the population if they are away for a total of 12 months or more over a 16 month period. The level of NOM is the balance of these NOM arrivals minus NOM departures.

This method is known as the '12/16 month rule'. It accounts for those persons who may have left Australia briefly and returned, while still being resident for 12 months out of 16.

Net overseas migration can fluctuate considerably from year to year, and has been increasing in recent years. Estimated NOM peaked at 320 400 for the year ending March 2009. Since this peak, NOM has fallen and the latest ABS estimates indicate that it was about 241 400 at 31 March 2010. This is a 25 per cent fall from its peak.

Currently NOM contributes about 60 per cent of Australia's population growth. NOM has outstripped the natural increase (the excess of births over deaths) in the population since 2005.

Composition

At 30 June 2009, about 25.6 per cent of the estimated resident population comprised those born overseas.

The countries representing the highest overseas born population are the United Kingdom (1 188 247, 20.43 per cent of overseas born), New Zealand (529 178, 9.10 per cent), China (350 979, 6.03 per cent), India (308 542, 5.30 per cent) and Italy (219 336, 3.77 per cent). Overall, the proportion of overseas born residents from European countries of birth is declining, while the proportion of migrants coming from Asia and Africa is increasing.

Potential workforce

The potential workforce is the number of people in the population of workforce age, which is conventionally defined as 15-64 years old. The actual workforce will depend on the proportion of people aged between 15-64 years that seek to actively participate in the workforce and those 65 and over who continue to work.

There is a also a potential workforce cohort of people who are less than 15 year olds who may be in the workforce (with parental permission) but are not reported in the population of workforce age.

In recent years Australia's potential workforce has been growing by more than 200 000 people each year. In the year ending June 2009, the potential workforce increased by 298 500 people to reach 67.5 per cent of the population.

The three different ABS series show quite different outcomes in the number of people aged 15-64 years (see figure below). For example series A shows continued strong growth in Australia's potential workforce to 2101, whereas series C shows only modest growth.

Source: Population Projections, Australia 2006 to 2101 (ABS Cat. 3222.0)

 

People not in the workforce are generally less likely to be paying taxes and are more likely to be dependent on pensions and other forms of government support. Therefore another useful measure is to compare Australia's potential workforce against Australia's total population. This analysis shows similar trends for all three ABS series, with the proportion in the 15-64 years age-range steadily declining from 67.5 per cent in 2008 to between 59 and 61 per cent in 2051 and between 56 and 59 per cent in 2101.

Source: DIAC based on Population Projections, Australia 2006 to 2101 (ABS Cat. 3222.0)

Population ageing and labour future

Population projections for Australia show that the ageing of our population will continue. This is the inevitable result of fertility remaining at low levels over a long period and increasing life expectancy.

Over the coming years, the population is projected to age progressively with the median age of 37.0 years in 2008 increasing to between 41.9 years (series A) and 45.2 years (series C) in 2056.

Similarly, the proportion of older Australians is expected to increase over the coming years. In 2007, around 13 per cent of Australia's population were aged 65 and older, by 2056 this figure is expected to be between 23 and 25 per cent (series A and B).

Research shows that immigration beyond current levels would have a diminishing impact on retarding the ageing of the population. This reflects ageing being a gradual process and that most migrants who enter Australia would themselves be part of the aged population in 30 to 40 years time.

Research commissioned by the Department of Immigration and Citizenship consistent with the 2010 Intergenerational Report shows that after 2036 there will be more Australians retiring from the labour force than joining the labour force. This is because of the ageing baby boom generation and because long-term fertility rates remain below a replacement level. Immigration currently provides 60 percent of our population growth, but within the next few years it will be the only source of net labour force growth in Australia. Without immigration, labour force growth will almost cease within the next decade.

The department is developing a long term immigration planning framework that will inform and guide our future migration program decisions while maximising the benefits for Australia.

For further information about population ageing and Australia's labour future, please refer to Demographic and labour Supply Future's for Australia (2008).

Further information is available on the department's website.
See: www.immi.gov.au

The department also operates a national general enquiries line.
Telephone: 131 881
Hours of operation: Monday to Friday from 8.30 am to 4.30 pm (recorded information is available outside these hours).

Fact Sheet 15. Produced by the National Communications Branch, Department of Immigration and Citizenship.
Last reviewed October 2010.

© Commonwealth of Australia 2009.