This is what’s going to drive population growth

Population growth in Australia has slowed from its recent peak of a shade above 405,000 per annum in September 2013 back to around 354,600 per annum on the latest figures.

This headline number will have some way to fall yet, with the December 2014 figures yet to be reported.

However, a rebound is in the post in time.

In the summer month of January 2015, traditionally a strong month for long term arrivals, the Australian Bureau of Statistics figures recorded a bounce from 52,160 to 76,310, although the January result is still 9 per cent lower than one year ago.

On the departures side, however, long term and permanent departures also declined in January from 46,740 to 42,100, which notably is a below figure than the prior year comparative.

On a rolling annual basis net long term migration of 318,560 sits some 22 per cent below the most recent peak of January 2013.

However, the population growth tide is now steadily turning, in part due to…

Boomerang departures

When it comes to the long term and permanent departures data, stated intentions when ticking boxes on forms are one thing, but today’s reality is quite another.

Boomerang departures are one of the reasons that our capital cities appear so crowded, despite the apparently slowing population growth data.

On the one hand we now have record high short term arrivals at close to 7 million per annum.plane

And meanwhile most of those who claim to be migrating overseas permanently have “pulled a boomerang” within a year of leaving.

Analysis of prior years’ data from the Australian Bureau of Statistics reveals that while ostensibly more than 380,000 Australians left the country on a long term or “permanent” basis over the past 12 months, more than 80 per cent of them are likely return home within just a year!

“Analysis shows that the majority of those with an intention of permanently departing, return to Australia within the following year. 

For example, in the calendar year 2011, out of the 84,240 Australian residents who stated they were departing permanently, only 15,890 spent 12 months or more overseas.”

So much for the “long term-ness” of the long term departures, if you’ll kindly pardon my dreadful English.

Perhaps those pastures further afield aren’t as greener-er as what people think they are, and that’s why they done that.

OK I’m getting rather grammatically bogged down here, so let’s move on to look at…

Record high visitors (the delayed Oprah effect)

Shifting seamlessly along to short term arrivals we can see that visitors to Australia have sprinted to their highest level on record at more than 6.9 million.

The idea that Kiwis are flocking home to rediscover the beauty of their homeland is an appealing narrative, but also one that has been overplayed.

In fact, record numbers of New Zealanders arrived in Australia in the past year on a “short term” basis at close to 1.25 million.
There has also been a notable surge in the number of American visitors to Australia to a record 555,300 on a rolling annual basis.

Oprah Winfrey said it’d happen, and it seems she was right.

Although the detailed figures do show a spike relating to her December 2010 visit – from memory she brought along a few hundred whooping guests, and even greater numbers of security guards and filming crew – it is only in the past 12 months that American visitor numbers have really picked up strongly.

Naturally the decline of the Aussie dollar towards the mid 70 cent range against the greenback is a big driver here.

And the below mega-trend, I’ve documented here often previously.

Expect more of the same based upon what I’ve seen around the traps in 2015.

Asian settlers

In terms of settlers in Australia the trend has clearly been away from Brits and Kiwis since the financial crisis and towards Chinese and Indians.

However, there was a reasonable rebound in the number of New Zealander settlers in January so this particular downtrend may have run its course for now, although Kiwi settler numbers are still clearly down by 10 per cent or so from a year ago.

Poms clearly are evidently still opting to stay at home, though.

The last 12 months has seen some 71,310 settlers from Asia, another mega-trend that shows no real sign of abating.

The wrap

The rolling long term net migration figures imply that Australian population growth will sink back towards the low 300,000s range over the near term.

However, a complex range of factors will combine to drive a rebound in due course.

Not least of these trends is that most who claim to be slinging their hooks for good don’t even make it past year one before “pulling a boomerang”.

Want more of this type of information?

Pete Wargent


Pete Wargent is a Chartered Accountant, Chartered Secretary and has a Financial Planning Diploma. He’s achieved financial freedom at the age of 33 - as detailed in his book ‘Get a Financial Grip – A Simple Plan for Financial Freedom’. Pete now manages his investment portfolio, travels and works as a consultant in the finance industry from time to time. Visit his blog

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