The surge in immigration swelling Australia’s population is being offset by falling numbers of babies and more people dying from COVID, with new forecasts showing the country is on track to be home to 31.3 million people by the middle of next decade.
In a further challenge to government infrastructure and housing plans, the federal Centre for Population on Friday forecasted the country will add an extra 4.1 million residents over the next 10 years – most of those will live in Sydney, Melbourne, Brisbane and Perth.
The nation is expected to add 4.1 million residents over the next decade, according to new forecasts.Credit:Janie Barrett
By the middle of 2034, Sydney and Melbourne are expected to have about 6.5 million residents each. Sydney, the nation’s most populous city since the turn of the 20th century, will add about 900,000 residents over the next decade while Melbourne is tipped to add more than 1 million.
The new forecasts hinge on the government’s ability to bring down net overseas migration. In this week’s mid-year budget update, expected net migration was increased by 30 per cent to 340,000 with that tipped to fall to 255,000 in 2025-26.
The centre’s executive director, Nick Latimer, said while the nation’s expected population by the mid-2030s remained similar to its forecasts made last year, the drivers of growth had changed.
The lift in net overseas migration, which he put down to temporary migrants remaining in the country for longer than expected, would push up population growth in the short term.
But this was offset by fewer births than expected after the nation’s fertility rate dropped to a record low of just 1.5 children per woman this year. More deaths, mostly due to the impact of COVID, also meant natural population growth was lower than expected.
In 2022-23, COVID accounted for 4.1 per cent of all deaths with this easing to a still significant 2.2 per cent last year.
“The effect of COVID-19 on mortality is projected to continue declining over the next few years, with mortality rates returning to pre-pandemic trends from 2028-29 onwards,” he said.
This year, natural increase is expected to add about 104,000 to total population. By 2064-65, when Australia’s population is predicted to have reached 41.2 million, natural increase is tipped to have fallen to just 78,000.
The decline in births, and the dependence on migrants, mean the country is ageing faster than anticipated.
In regional Victoria, South Australia and Tasmania, deaths are expected to soon overtake births. Only people making a sea-change from urban areas or overseas migrants are forecast to prevent their populations from shrinking.
Australia’s current median age is 38.4. By 2034-25, it will have climbed to 40. In Tasmania, the state with the oldest age profile, the median age will hit 40 by mid-2026 and 46.3 by the mid-2030s.
The old-age dependency rate, which is the ratio of people aged over 65 compared to those of working age, is expected to soar from 26.8 to 30.8.
Treasurer Jim Chalmers said the ageing of the population would continue to be a pressure on the nation’s finances.
“By 2064–65, nearly one-quarter of the population is projected to be aged 65 and over, which will pose a significant fiscal and social policy challenge,” he said.
The forecasts confirm the share of people living in the nation’s capitals is expected to grow at twice the rate of regional and rural areas.
Sydney will be home to 67 per cent of all NSW residents by 2023-25 while the share of Victorians living in Melbourne will climb from 77 per cent to 78.4 per cent.
The share of Australians living in rural and regional areas is expected to continue falling over the next decade.
The nation’s sparsest state, Western Australia, will also remain the one with the largest share of its residents in the capital, climbing from 80.6 per cent this year to 82 per cent by 2034-35.
Brisbane is forecast to be home to more than half of Queensland’s residents for the first time since 1978 from 2025-26.
WA and Victoria are expected to be the fastest-growing states, with Tasmania and South Australia likely to be the slowest.
Melbourne, which in last year’s forecasts was tipped to overtake Sydney as the most populous city by 2031, is now not expected to be the biggest city until the second half of the 2030s. This is partly because more new migrants are tipped to head for the NSW capital over its Victorian counterpart.
The population of Hobart is expected to increase by just 15,000 over the next decade to 270,000. Almost all of that will be due to net overseas migration.
Canberra is expected to add 61,000 residents, taking its population to 541,000 by 2034-35, due to a mix of overseas migrants and natural growth.
