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The Impact of Immigration on the Ageing of Australia's Population

Peter McDonald and Rebecca Kippen

Conclusion

Given current trends in fertility and mortality, annual net migration to Australia of at least 80,000 persons is necessary to avoid spiralling population decline and substantial falls in the size of the labour force. This level of annual net migration also makes a worthwhile and efficient contribution to the retardation of population ageing.

Levels of annual net migration above 80,000 become increasingly ineffective and inefficient in the retardation of ageing. Those who wish to argue for a higher level of immigration must base their argument on the benefits of a larger population, not upon the illusory 'younging power' of high immigration.

The effects upon ageing of a younger immigrant intake or higher migrant fertility are very small. Furthermore, implementation of either measure would be problematic. They are not realistic options.

It must also be pointed out that many permanent and long-term movements of people into and out of Australia are largely outside the control of the Government. The Government has an extremely limited capacity to prevent or accelerate any movement out of Australia.

Also, there is little control possible over movements into Australia of New Zealanders and of spouses and fiancés of Australians. Finally, the Government has only a limited degree of control at present over movements into Australia of students, temporary business entrants and holiday-makers.

Thus, even though a government may aim for a particular level of annual net migration, the actual level achieved may be substantially removed from the target because of population movements outside governmental control.

Paul Johnson, an economist at the London School of Economics, recently provided a very important message in regard to population ageing (Johnson 1999). He argues that the 'problem' of population ageing does not require the implementation of draconian or extraordinary measures. He points out that Australia is in a better position to deal with ageing of the population than almost any other OECD country.

Given Johnson's assessment and given that very high immigration levels are ineffective and inefficient in bringing about changes in the ageing of the population, it is not sensible to argue for large-scale immigration (above 80,000 net per annum) on the basis of its impact on ageing.

Substantial ageing of the population of Australia is inevitable over the next 30 years. No reasonable shift in our demography in the next three decades can change this outcome. Through prudent long-term policies in the areas of income support, health and service provision and retirement from employment, and through the promotion of positive attitudes to older people, Australia will be well-placed to meet the challenge of population ageing.

At the same time, demographic trends in the next 30 years will be vital in determining the shape of Australia's age structure beyond 2030. With zero immigration and lower fertility, the ageing of our population will continue apace after 2030; the coffin scenario.

Ageing of the population can be substantially retarded beyond 2030 through combinations of fertility and immigration which guarantee at least zero population growth; the beehive scenario.

 

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Last reviewed Tuesday 19 November 2013

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