By Cameron Kusher

Chart 1

The Australian Bureau of Statistics (ABS) released demographic data for the June 2015 quarter earlier today. The data is valuable because it provides insight into the size of the country’s population as well as an analysis of the different sources of population growth at both the national and state level. At the end of June 2015, the national population was estimated at 23,781,169 persons having increased by 317,083 persons over the year.

The rate of population growth over the 12 months to June 2015 was recorded at 1.4% which has continued to slow. Victoria (1.7%) along with New South Wales (1.4%) and the Australian Capital Territory (1.4%) have seen the fastest annual rate of population growth while Tasmania and the Northern Territory (both 0.4%) have been noticeably weaker than all other states and territories for population growth. The national rate of population growth has slowed from a peak of 2.2% per annum in December 2008 and a more recent peak of 1.8% in December 2012. Since this most recent peak the profile of population growth has changed markedly; at that time Western Australia (3.7%), the Northern Territory (2.8%), Queensland (2.0%), and Victoria and the Australian Capital Territory (both 1.8%) had the highest rates of population growth. All states and territories now have a lower rate of population growth, with the sharpest falls in the resource states and territories, while the slowdown in population growth across Victoria has only been moderate. Conversely, over the 12 months to December 2012, New South Wales’ population increased by 1.3%, South Australia’s by 0.9% and Tasmania’s by 0.1%. New South Wales and Tasmania are both currently recording a faster rate of population growth than they were when the national rate of population growth was peaking.

In terms of the actual raw number increase in population; New South Wales leads (104,266) followed by Victoria (99,371), Queensland (58,929) and Western Australia (33,213). Between them, New South Wales and Victoria accounted for 64.2% of the national population increase and if you include Queensland and Western Australia the figure rises to 93.3%. The 64.2% share of all total population increase occurring in New South Wales and Victoria is a record high. Elsewhere the annual increases in population were recorded at; 13,110 in South Australia, 1,860 in Tasmania, 939 in the Northern Territory and 5,360 in the Australian Capital Territory.

chart 2

At a national level there are two components of population growth; net overseas migration and natural increase (births minus deaths). Over the year, there was a natural increase of 148,900 persons and net overseas migration of 168,183 persons. Natural increase was -5.1% lower over the year and net overseas migration fell -11.4% and was recorded at its lowest annual level since September 2006. In fact, over the quarter there was net overseas migration of 28,498 persons which was the lowest quarterly increase since June 2006. As a result of the fall in both natural increase and net overseas migration, the annual rate of population growth has fallen by -8.6% over the year.

At a state level population growth is also affected by movements between states (interstate migration) as well as natural increase and net overseas migration. For the purposes of this analysis we will just be looking at migration rather than natural increase.

chart 3

Looking at net overseas migration, New South Wales and Victoria are the major benefactors of overseas migration. In fact, 71.4% of total net overseas migration flowed to these two states with the figure rising to 91.2% if you include Queensland and Western Australia. This highlights that most of the migrants to the country are moving to the largest cities. The Australian Capital territory is the only state or territory where annual net overseas migration is higher over the year, up 22.6%. The largest annual falls in net overseas migration have occurred in the resource states and territories of Queensland (-31.2%), Western Australia (-31.6%) and the Northern Territory (-30.6%). Looking at the quarterly data across the largest states, in New South Wales net overseas migration was at its lowest level since June 2011, in Victoria it was at its lowest level since June 2010, in Queensland it has increased from a low of 1,752 in December 2014 and in Western Australia it is at its lowest level since June 2004.

chart 4

Net interstate migration in to Victoria was at a record high of 10,190 persons over the 12 months to June 2015 while Queensland was the only other state to record positive net interstate migration of 6,417 persons. Elsewhere, net interstate migration was recorded at: -6,639 persons in New South Wales, -3,763 persons in South Australia, -1,962 persons in Western Australia, -528 persons in Tasmania, -3,083 persons in Northern Territory and -677 persons in the Australian Capital Territory. Although New South Wales continues to lose people to other states it continues to do so at record low levels. Meanwhile net interstate migration into Queensland has improved a little but remains near historic low levels and Western Australia is losing the most people to other states and territories since 2002 with no sign of a slowdown in this trend. The last few quarters of data indicate that interstate migration into Queensland and Tasmania may be starting to pick-up while it slows elsewhere.

The demographic data shows that population growth is continuing to slow however, the most market slowdown continues to occur in mining states and territories. Population growth is much greater in New South Wales and Victoria and so too is overseas migration. This would tend to indicate that people are following the stronger economies and subsequently where the job opportunities are strongest. Subsequently this has contributed to additional demand for housing in Sydney and Melbourne and been a key input to the recent value growth in these cities. Quarterly data suggests that the surge of people moving to New South Wales and Victoria is starting to slow, this may be linked to housing affordability. The next few quarters of data will be interesting to analyse to see if population trends are shifting in concert with the recent slowing of housing demand in both Sydney and Melbourne.

Source: RPD

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