Population Growth Lifts As Driving Force

Posted on 27/06/2018  
Population Growth Lifts As Driving Force

Australia’s population is growing faster than ever before and is now set to hit a milestone it wasn’t expected to reach until 2051, in a trend likely to impact on property markets in our biggest cities.

Less than 20 years ago, in 1999, Australia’s population was 19 million and it wasn’t expected to top 25 million until 2051.

But figures released by the Australian Bureau of Statistics now suggest this milestone will be reached in early August this year — 33 years earlier than scheduled. Strong overseas migration is considered responsible for the accelerated growth rate.

Social researcher and demographer Mark McCrindle, of McCrindle Research, says it took just two and a half years to add the last million people.

“That’s a record, the previous million took two years and nine months,” McCrindle says.

When Australia’s population jumped from 23 to 24 million on the 23 April, 2013, it was the first time that a million people had been added in less than three years.

“The speed we are adding each million now has never been shorter,” McCrindle says.

“The population increase has never been greater.”

Previously natural increase was the biggest factor, contributing 53% of the population growth, while migration only made up 47%. The 2017 data found natural increase made up just 38% of the growth, while migration was responsible for 62%.

“So back then, net migration was contributing less than half of the growth, now it’s almost two-thirds,” he says.

This is in line with the most recent Census results that showed Australia was more multicultural than ever, with 26% of the population born overseas, compared to only 18% in 1966.

The accelerated population growth has brought some positive impacts including driving economic growth, domestic demand and the growth in the property sector, but it’s also created challenges.

“It seems city planning and general infrastructure provision was based on population growth that was a lot less than we are actually experiencing,” McCrindle says.

“If you are wondering why we have infrastructure bottlenecks, traffic congestion and housing unaffordability, it’s because the growth was red hot and the planning was based on the wrong numbers.”

Meanwhile, new data has highlighted the critical importance of the housing industry to the Australia economy – with high population growth a driving force.

Population data shows Melbourne added one million residents in the last decade, followed by Sydney (806,000), Brisbane (449,000) and Perth (415,000).

“Housing that many people was a major challenge for each of these cities.,” says Simon Kuestenmacher of The Demographics group.

“The speed of urban development, driven by strong migration figures, over the past 10 years determined where and what type of housing was built. Melbourne and Sydney had to rapidly add to their housing stock.

“This led to a boom in the construction industry. Over the last decade, Australia added 220,000 workers to the construction industry. That’s 22,000 new, mostly middle-class jobs every year. Today the construction industry employs 1.2 million Aussies, or 10% of the total workforce.”

Data from the Australian Bureau of Statistics shows that the number of Australian construction businesses grew by 62,000 to 371,000 from 2007 to 2017.

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