The problem with Australia’s population ageing is not that there are too many older people – it’s that there are not enough young people to support them, that presents many challenges to Australia’s continued…writes
The problem with Australia’s population ageing is not that there are too many older people – it’s that there are not enough young people to support them.
That presents many challenges to Australia’s continued prosperity, which are becoming more apparent by the day as more Baby Boomers, born between 1946 and 1965, reach retirement age.
So what’s the solution?
As our research in the latest volume of the Australian Journal of Social Issues shows, Australian kids – from those still in nappies through to children aged up to 11 – may yet come to the Boomers’ rescue.
As the last of the Baby Boomers exit the labour market, their grandchildren will arrive.
This generation will arrive to a labour market in desperate need of tertiary educated, highly skilled professionals.
Those young Australians will stem the economic and fiscal impact of Australia’s population ageing as the Baby Boomers retire, helping governments to keep paying the bills for costly health and welfare programs.
That’s why we’ve dubbed this generation “Generation Thank God You’re Here” (TGYH).
Who belongs to Gen TGYH?
Generation TGYH are the children born in a baby boom that began in 2003.
They are being born to Generation X and also some Generation Y women who typically delayed motherhood by compressing their critical childbearing years.
In contrast to their Boomer mothers, these women delayed childbearing because of education and employment opportunities.
Generation TGYH will be bigger than their parents’ generations.
Between 2003 and 2012, more than 2.8 million TGYH babies were born.
However, recent fertility data from the Australian Bureau of Statistics indicates that the baby boom of the 2000s may be over.
The data suggests that many Gen X women are completing their families and are unlikely to have more children in the future.
This slowdown in the fertility rate, and the resultant decrease in the number of children being born, further highlights the importance of Generation TGYH.
What ‘Sandwich Generation’ parents can do to help
The timing of Generation TGYH’s entry into the Australian workforce – just as the last of the Baby Boomers retire – is perfect.
And so too is its size.
This generation will be big enough to replace over a quarter of million Baby Boomers, who will be near retirement age when the Gen TGYHs are ready to enter the labour market in 2020.
So if we want today’s babies and young children to serve Australia well as adults, it’s in our interests for current and future governments to help them grow to their full potential – especially by focusing on early childhood development and education.
Many adults working today belong to what has been called the “Sandwich Generation”: parents whose time is squeezed between raising children and looking after ageing parents.
Those older workers have a vested interest in investing in future workers including Generation TGYH, as that investment will indirectly influence the strength of the Australian economy in the future – including their own standard of living in retirement age.
Should governments fail to recognise the importance of this coming generation, they may leave a group of young people without adequate education and skills to succeed the Baby Boomers.
That risk is real.
Brotherhood of St Laurence research has shown that more than a quarter of all young Australians in the labour market are either unemployed or underemployed.
This should be a warning to governments about the effects of failing to prepare young people for their futures.
The previous government prepared a Intergenerational Report in early 2015.
As our previous treasurer Joe Hockey indicated when the report came out, it will:
create a framework that will help define the destiny of the federation white paper, the tax white paper and the budget next year … it is a document that will begin the national discussion about where our economy must go.
We can only hope that the report kick-starts a national discussion about what all of us – governments, communities and families – can do to give today’s kids a flying start to get them ready to fill the employment and economic gap left by the Baby Boomers.
SUBSCRIBE & DON'T MISS A SINGLE EPISODE OF MICHAEL YARDNEY'S PODCAST
Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.
PREFER TO SUBSCRIBE VIA EMAIL?
Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.