​​The Stats Guy: Record-breaking migration reshapes the nation

National population data gets published with about a six-month delay. As of this week we know the Australian population count as of September 30, 2022. For those playing along at home, Australia is now home to 26,124,814 people – without you that’s only 26,124,813 people. See, you matter!

The big story is that Australia saw a record high net overseas migration intake in September. Net overseas migration is calculated by subtracting the number of migrants that left the nation from the number of migrants that entered the nation.

Why did we just record the largest quarterly net migration intake in our national history? We saw a very low migration intake throughout the pandemic. Consequently, we now have few international students and temporary workers in the country that could potentially have left the nation during the September quarter. In data speak: overseas departure numbers were relatively low.

There was, of course, quite a bit of pent-up demand for people moving to Australia. Many that couldn’t move Down Under during the border closures made the move eventually. Voila! We recorded record high overseas arrival numbers in the September 2022 quarter.

The main takeaway is that Australia remains a popular destination for international students and skilled workers alike. Brand Australia wasn’t permanently damaged during the pandemic.

When Australia grows its migration intake it obviously grows its population base. Natural increase describes the surplus number of births in Australia relative to the number of deaths. Birth figures remained somewhat stable over the last 15 years as two trends cancelled each other out. While Australians on average had fewer kids (i.e. the birth rate fell), it is currently the super large Millennial cohort (born 1982-99) that is giving birth.

Whatever happened in the country over the last 20 years, about 75,000 babies were born every quarter. Because the number of deaths is at an all time high, natural-increase numbers are falling. About 53,000 people died during the September 2022 quarter. As more and more Baby Boomers (1946-63) enter the dying stage of the lifecycle, natural increase will contribute less and less to national population growth.

As a rule of thumb, only about a third of population growth is due to natural increase. Soon only a quarter of the national growth will come from natural increase, ensuring migration will reshape Australia in an even more impactful manner.

Population growth in the September 2022 quarter wasn’t large enough to qualify as record breaking. That said, it is very much possible that the next few quarters will see Australia grow by record numbers.

Whether or not you favour such a development, anything but another round of Big Australia style growth, like we’ve seen during the 2008 mining boom, would be a surprise at this stage. This means we must focus our energies to manage and channel such growth as good as we can.

The lion’s share of population growth is set to occur near university campuses and near the CBDs (Central Business Districts) of our capital cities – the new arrivals are either international students or skilled workers. Both groups are unlikely to own a car initially, will rent for the first few years, and aim to live as close as possible to their campus or place of work. Anyone running a business in the inner suburbs or owning property there will love to hear this. More customers, more workers, more rental demand. Great news for people tying their economic success to population growth.

A major policy oversight in Australia is potentially making life unnecessarily expensive. Our national migration and housing policies operate independently of each other, thus we can ramp up migration numbers without providing adequate levels of housing stock. That’s pretty mad when you think about it. I suggest the two relevant ministers should be required to live as housemates in Canberra. Maybe a good real estate agent in Canberra can find a nice share house for the Hon Julie Collins MP (Minister for Housing, Homelessness and Small Business) and the Hon Andrew Giles MP (Minister for Immigration, Citizenship and Multicultural Affairs). The two can coordinate policies while cooking pasta after a long day in Parliament. I see no flaw in my reasoning.

All joking aside, the high migration approach to managing Australia is our best bet to slow the massive impact that the ageing of the population has on our economy and workforce. Such rapid population growth needs to be carefully managed though. Are we importing the right type of jobs? Are we building enough homes? Are we providing cheap enough housing? Are we providing housing in the right places? Let’s not forget that infrastructure needs to keep pace with growth as well. Let’s proactively manage the challenges that record-breaking migration brings with it rather than pretending it won’t occur.

Demographer Simon Kuestenmacher is a co-founder of The Demographics Group. His columns, media commentary and public speaking focus on current socio-demographic trends and how these impact Australia. Follow Simon on Twitter or LinkedIn for daily data insights in short format.

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