Population

Michael Roden, Statistics and Mapping Section
Henry Sherrell, Social Policy Section

Key issue
Australia’s population, compared to other nations, is: mid-sized; briskly growing; ethnically diverse; middle-aged; sparsely settled yet highly urbanised; and characterised by high life expectancy and a middling birth rate. The changing nature of the population raises policy challenges across a number of areas, including immigration, infrastructure and the labour market.

As Australia’s population passed 25 million in 2018, public debate once again emerged on the size and nature of Australia’s population. During this debate, public opinion appears to have shifted with increasing sentiment that the rate of migration is too high.

The Morrison Government announced a formal population policy in early 2019, centred on reducing the number of permanent residency visas, creating incentives for new migrants to live outside of the largest capital cities, and promoting a suite of infrastructure measures. However, it is unclear whether this package will significantly alter the trajectory and composition of Australia’s population.

How does Australia’s population compare?

When compared with the 36 OECD nations, Australia has the 13th largest population, is the eighth youngest, and the fourth fastest growing.

Table 1: Australia’s demographic indicators ranked among OECD nations, 2010–15

Total population size	13th largest
Population growth rate	4th fastest
Net overseas migration rate	4th fastest
Median age	8th youngest
Fertility (birth) rate	9th highest
Life expectancy	5th highest

Source: United Nations Population Division, World Population Prospects 2017 website, accessed 5 May 2019.

These indicators are inter-related and subject to change over time. Rates of net overseas migration, fertility and life expectancy all affect total population size. As an example of how these rates can change, in 1975, Australia and the United States both had a life expectancy of 72.6 years. By 2016, an Australian’s average lifespan had increased ten years (to over 82), considerably more than an extra six years of life on average in the United States.

What does Australia’s population change look like?

Australia’s population is growing at about 1.6 per cent per year, approximately 400,000 people. While fertility has been reasonably stable (at just below two births per woman) and life expectancy has steadily improved since the late 1970s, net overseas migration has fluctuated much more—and re-emerged as perhaps the key driver of population change. Unlike life expectancy and birth rates, the rates of migration to and from Australia are more volatile and tend to respond to changes in government policy, the strength or otherwise of the labour market, and a number of other factors, including the presence of an existing migrant community. See ‘Australia in numbers’ in this publication for a broad demographic overview.

Figure 1: net migration to Australia, number and rate, 1901–2017

Net migration to Australia, number and rate, 1901–2017

Sources: ABS, Australian Historical Population Statistics, 2019, cat. no. 3105.0.65.001 and Australian Demographic Statistics, Sept 2018, cat. no. 3101.0.

Since Federation, Australia has mostly been an attractive migration destination, except for the period around the Depression and World War II (as seen in Figure 1). After World War II, both Labor and Coalition governments introduced policies to substantially increase Australia’s migration intake.

Figure 1 shows that since 2006, net overseas migration has been at record levels, now approaching 250,000 per year. While also near historic highs, the more stable per capita migration rate is just above the rates seen in the 1950s and 1960s. Accordingly, overseas-born Australian residents represented 29.4 per cent of the population in 2018, compared with 23.2 per cent in 1998.

However, it is important to note that net overseas migration projections over long periods tend to be unreliable. As the 2015 Intergenerational Report notes ‘actual population outcomes over coming decades will depend upon the future immigration policy settings of successive governments, as well as Australia’s relative economic performance’. This uncertainty can create difficulties in developing and implementing policy on issues affected by immigration, such as infrastructure and service delivery planning.

Figure 2: net overseas migration to Australia, top 20 source countries, 2017–18

Net overseas migration to Australia, top 20 source countries, 2017–18

Note: ^ United Kingdom, Channel Islands and Isle of Man.
Source: ABS, Migration, Australia, 2017-18, cat. no. 3412.0.0.

Composition of new arrivals

Since the demise of the White Australia Policy, migrants have come from a wide diversity of nations. Today, India and China are the leading source countries of migration to Australia, followed by Nepal (Figure 2). Most people arrive in Australia on a temporary visa, with international students being the largest single temporary visa category. Some of these people will transition to a permanent visa over time; however, most will leave Australia. Others come on permanent visas, which includes arrivals holding a humanitarian visa from countries such as Afghanistan or Syria.

While Australia once had large numbers of migrants from the United Kingdom, in recent years there has been a decline in emigration from traditional source countries (such as the UK and European nations). Today, comparatively more migrants are coming from Asian nations, the Middle East, South America and African nations. New Zealanders, due to the ‘open border’ arrangements that exist between the two countries, present a unique case. Despite the current modest net gain of New Zealand migrants, there is a large two-way flow across the Tasman Sea.

Related to these net migration compositional features is the growing share of non-permanent residents, such as students, visitors and working holiday-makers. While it is difficult to assign rates of migration to specific visa categories, there has been an increase over the past two decades of migration via temporary visas (see ‘Migration—permanent and temporary visa trends’ in this publication for more detail).

Figure 3: median age, Australia, observed 1901–2018 and projected scenarios to 2051

Median age, Australia, observed 1901–2018 and projected scenarios to 2051

Sources: ABS, Australian Historical Population Statistics, 2019, cat. no. 3105.0.65.001; Australian Demographic Statistics, Sept 2018, cat. no. 3101.0; and Population Projections, Australia, 2017 to 2066, cat. no. 3222.0, Series A, B, C.

The growth in younger migrants has slowed the rate of ageing of the overall population, demonstrated by the median age plateauing in recent years (Figure 3). This has implications for anything sensitive to the population age structure, such as the labour force; and for planning related to the long-term and intergenerational effects of an ageing society. Despite the recent slowdown in ageing, migrants cannot ‘solve’ the issue of an ageing population as they too will age. This trend can be seen in higher median ages in the three 2051 projection scenarios in Figure 3.

Settlement patterns

Another implication of recent migration growth has been to reinforce the urbanisation trend in Australia. Globally, the shrinking proportion of the workforce required in primary production and growing industrial and service sectors, has led to a larger share of people living in urban areas.

Figure 4: urbanisation in Australia, 1911–2016

Urbanisation in Australia, 1911–2016

Source: ABS, Australian Historical Population Statistics, 2019, cat. no. 3105.0.65.001.

Australia’s capital cities, particularly Sydney and Melbourne, attract the majority of migrants, helping contribute to disproportionate growth in those areas. In 2017–18, population in capital cities grew by 1.9 per cent compared to non-capital city growth of 1.0 per cent. Urbanisation leads to various economic efficiencies, though sometimes at the cost of congestion and social isolation. A comparison of the 2006 and 2016 Census results shows total population in cities, towns, localities and rural areas with fewer than 100,000 people grew by just 90,000—while cities with over 100,000 people increased by 3.5 million people.

The Morrison Government’s population plan released in 2019 was explicitly promoted as ‘congestion busting’, and this also emerged as a theme in the 2019 NSW state election. However, population decentralisation policies in Australia have not, historically, been regarded as demonstrably successful.

Urbanisation is also challenging the dynamics of how population change is managed by governments. Recent frustration from state governments, particularly the Berejiklian-led NSW government, has focused on the inability to control migration flows at the state level. The combination of migration-led growth and continuing urbanisation has renewed interest in state-based management. In response, the Morrison Government’s population plan introduced additional state-based eligibility criteria for a number of permanent visa categories. However, the fundamental drivers of new migrants being attracted to major urban centres in the form of employment, higher education and cultural ties are unlikely to change in the short term, regardless of visa conditions.

Figure 5: net interstate migration flows, June 2015 to June 2018

Net interstate migration flows, June 2015 to June 2018

Note: Arrow width is indicative of, but not proportional to, net interstate migration.
Source: ABS, Australian Demographic Statistics, Sept 2018, cat. no. 3101.0.

Figure 5 shows the direction and size of net interstate migration in the three years to June 2018. Victoria and Queensland experienced strong net gains from most other jurisdictions; while the Northern Territory, South Australia, and Western Australia lost to most others. The gains to Tasmania and the large Western Australia losses are fairly unusual, historically speaking. NSW had large net outflows to Queensland and Victoria.

Australia’s Aboriginal and Torres Strait Islander population

Australia’s Aboriginal and Torres Strait Islander population has different demographics to the non-Indigenous populace. In 2016, the estimated population of 798,000 was just over double the estimated 1996 level and represented 3.3 per cent of Australia’s total population.

In 2015–17, Aboriginal and Torres Strait Islander women had an average total fertility rate of 2.26 births, which was 27 per cent higher than the national rate (approximately 1.8 births). During the same period, average life expectancy at birth for Aboriginal and Torres Strait Islander men was 71.6 years and 75.6 years for women—8.6 and 7.8 years lower, respectively, than for non-Indigenous men and women. Life expectancy gaps exist between major urban, regional and remote areas; but are significantly higher in remote areas. (For more information, see the ‘Closing the Gap’ elsewhere in this publication.)

Figure 6: Indigenous and non-Indigenous population by remoteness classification

Indigenous and non-Indigenous population by remoteness classification

Source: ABS, Estimates of Aboriginal and Torres Strait Islander Australians, June 2016, cat. no. 3238.0.55.001.

Almost 40 per cent of Aboriginal and Torres Strait Islander people live in outer regional, remote and very remote parts of Australia, compared to just under 10 per cent of the non-Indigenous population (Figure 6). Conversely, 73 per cent of the latter live in major cities (of 250,000 or more)—almost double the Aboriginal and Torres Strait Islander rate of 37 per cent.

What of the future?

If present population trends continue, what will Australia look like in coming decades?

The population will be considerably larger, with most growth occurring in major cities. Older Australians will make up a greater share of the population, as will Indigenous people and those born overseas. Victoria and Queensland will account for a larger proportion of the nation’s population at the expense of NSW, South Australia, the Northern Territory and possibly the highly-cyclical Western Australia.

However, history shows there can be significant changes in population trends. Migration may fluctuate due to policy and/or economic factors, and the main countries of origin may continue to change. And, while birth rates and life expectancy appear to have quite stable trajectories, these trends are by no means guaranteed.