Property Research

20 years of population growth

CITIES & INFRASTRUCTURE • December 5, 2018
Tags: RESEARCH

 

As state and territory governments prepare to discuss population growth at the COAG meeting in Adelaide in a few weeks it is useful to look at the past relationship between overseas migration and population growth.

As of March 2018, new migrants made up 85 per cent of the population growth in New South Wales. The NSW State Government is proposing to cut this to by more than half to only 31 per cent. On a global scale, new migrants made up 48 per cent of population growth in the United States of America in 2017 and 26 per cent in New Zealand.

 

2018-December-6---Migration-and-population-graph

NSW population growth is currently 1.4 per cent per annum. This is already less than both Queensland and Victoria at 1.7 per cent and 2.2 per cent respectively. To further cut this down to pre-2007 levels may influence NSW, as low population growth in high income countries is likely to create social and economic problems. Population and economic growth have a long term equilibrium relationship where per capita GDP is caused by population growth and visa versa.  Over the 40 years to 2015, population factors contributed almost 18 per cent of the 1.7 per cent annual average growth in GDP per person.

Especially in the post global financial crisis, Australia needs to promote growth. In the two years to June 2018 GDP has averaged 2.6 per cent, which is no better than between June 2007 to June 2009 during the GFC when GDP was at 2.81 per cent. Growing populations increase the supply of both workers and consumers.

The key is to create sustainable growth through better planning systems and investment in infrastructure.

 

data-room-government-and-taxes