economy

Australia needs high immigration to boost economic growth, says global report

by Ray Clancy on December 28, 2017

in Australia

Australia is on track to become the world’s 11th biggest economy within a decade, but it will need immigration to help it to do so, according to a new international report.

The Centre for Economics and Business Research, based in London, is forecasting Australia will climb two places on its world economic league table by 2026 from its current ranking of 13.

(fintastique/Bigstock.com)

Cebr says that countries that depend on brainpower to drive their economies will generally overtake those dependant on natural resources and while Australia’s economic growth has been fuelled by resources in recent years, the report says that it has become one of the most popular countries in the world for inward migration.

And it’s particularly Australia’s intake of migrants with highly sought-after skills that will help fuel its future growth. It also suggests that economic growth might be curtailed if immigration falls.

The report points out that the digital revolution is set to power the world economy through to 2032 and countries like Australia will need creative workers and one of the best ways to get them is through immigration.

‘The growing population means the economy is forecast to rise from 13th largest in 2017 to 11th largest economy in 2026,’ the report explains, adding that investment in urban infrastructure will need to accelerate as Australia’s population increases.

Official figures show that just under 190,000 permanent immigrants arrived in Australia in the 2015/2016 financial year, the majority of whom were skilled workers. But in the last 12 months it reached 245,000, a rise of 27%.

This level of immigration is high globally at 1.6% compared to other similar nations, more than double the US, three times that of the UK and four times the immigration rate in France.

On current projections, Australia’s population will reach 38 million people by 2050 and most of this will be driven by immigration.

Yet more Australian’s want to keep working. The latest figures from the Australian Bureau of Statistics shows that Australians aged 45 years and over are intending to continue in the labour force until 65 years, up from 63 years a decade ago.

‘This is consistent with the continuing trend of people staying in the workforce for longer. A decade ago, around 9% of people aged 65 and over were employed. This has increased to around 13%,’ said ABS chief economist Bruce Hockman.

Sales workers had the highest average age that they expected to retire at 66 years, while community and personal service workers had the lowest at 64 years. Some 38% said financial security was the most common factor affecting when to retire and 21% said health.

The ABS also released information for the 3.6 million people who were already retired, more than half of whom were aged 70 years and over.

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