In my column I often talk about population growth in absolute figures since this concept is just so simple to grasp.
Two weeks ago, I wrote a bit more about how relative population growth is a quick and dirty way of estimating changing market sizes. For today’s column we will be looking in the review mirror and discussing the shifting relative population change over the last 60 years.
Between the 1961 Census and 2022 (the latest year for which we have detailed population data) Australia more than doubled its population from 10.2 million people (today’s Melbourne plus Sydney, roughly) to 26.3 million.
Reviewing the last 60 years in absolute terms reveals a narrative of constant growth. Big Australia always won over F*ck off we’re full.
The above chart shows that the under-25 cohort was roughly the same size in 1982 as in 2002. While the young, economically unproductive population remained the same, the economically productive age groups in their 40s and 50s skyrocketed.
Having the large Baby Boomer (born 1946-1963) cohort in their economically productive prime allowed for huge economic growth (with a short pause during the recession in the 1990s). This trend started to slow a decade ago when the oldest Baby Boomers began to retire.
We start suspecting that certain age groups are just more important, depending on what share of the total population they make up.
In 1961 the under-17s made up 36 per cent of the population, while in 2022 they only make up 22 per cent. To be blunt, demographically the youth movement in the 1960s had 62 per cent more oomph than today’s youth movement.
Youth movement
The Beatles might have been unleashed onto a global population of only 3 billion people, but they spoke for a much larger slice of the population than today’s top performing artists.
Taylor Swift, Drake and Bad Bunny are unleashed onto 8 billion people. They would need to be three times larger than the Beatles to gain the same cultural significance.
A planet with a smaller relative youth cohort can’t possibly create equally culturally significant rock and pop stars. Demographics favour The Rolling Stones over Ed Sheeran. I wrote previously about why Jimmy Barnes couldn’t possibly be as successful today as he was 40+ years ago.
Down to business
Enough about pop culture – let’s talk business.
An obvious change is the ageing of the population. In 1961 only 7 per cent of the population was aged 65 plus. Today that share is 17 per cent.
As a nation we need to care for heaps more people. No matter how cynical you might be about politicians, you must applaud the introduction of superannuation 30 years ago.
A policy of foresight that acknowledged the inevitable aging of Australia. The 85-plus cohort now makes up 2.1 per cent (up from 0.3 per cent in 1961) – I explained in a past column why the growing 85-plus demographic needs our utmost attention.
The working age population (18-64) obviously does the heavy lifting when it comes to making Australia a rich and successful economy. Having a large share of your population in that age group makes it easier to grow GDP (assuming you create useful jobs for them).
In 1961 only 57 per cent of Australians were of working age. Bit by bit the Baby Boomers grew up and joined the workforce at scale. In parallell, Australia increased its migration intake (migrants are almost exclusively aged 18-39).
By 1982 over 60 per cent of the population was of working age. In 2002 a huge 63 per cent of the population was of working age. By 2022 this number fell to 61 per cent as the Baby Boomers reached retirement age. As the relative size of the labour pool shrinks Australia must embrace AI and automation to squeeze more productivity out of the remaining working bees.
The Reserve Bank teaches us that the 10-year cohort that spends the most money is aged 45-54. These hyper consumers are growing in absolute numbers but make up a shrinking share of the population now that Baby Boomers aged out of this cohort. It’s still a few more year until Millennials (born 1982-99) reach their big spending years.
The simple exercise of looking at relative population shifts allows us to put social and economic trends into perspective and to estimate the cultural impact that youth movements might have.
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, Facebook, LinkedIn for daily data insights in short format.
