Thursday, 2 August 2012

the agequake ahead

Australia in now leaving a unique period of demographics changes that signified the economic benefits of a high ratio of working-age to dependent population during our demographic transition. We now head towards an ageing population. During the cusp stage we are in now, there are both low birth rates and low death rates. Birth rates have dropped to well below replacement levels since the mid 1970's and that would normally lead to a shrinking population, had we not have our high net immigration.

As the large group born during our baby boom, 1946 to 1965 ages, it creates an economic burden on the shrinking working population by increased health, pensions and aged care. Our death rates are remaining consistently low and longevity is ageing our population as the average age climbs beyond the current 36.7

This 'gift' effect is not automatic and was earned by the presence of suitable economic policies, including high immigration, that allowed a relatively large workforce to be productively employed, evident in our current participation rates.

Now, the first wave of baby boomers are about to retire on mass. 1.2 million people will be added to the over 65's by 2015.

Low unemployment percentages will remain throughout the 'grey economy' starting this year and remain low, if not approach 0% as the full effects of the baby boomers, all retiring over the next 16 years, is felt.

Job ads will rise or stagnate as business will find it increasing harder to get staff. This trend will also continue well into this decade approaching.

Perhaps we should call the next 16 years the 'retiring economy' then after that the 'grey economy' 2026 to 2035

Then, as we have the boomers starting to die on mass, 2035 to 2045, the 'black economy', followed by the 'green economy' as the average age might actually drop. 2045 to 4000.

No comments:

Post a Comment

Comments by approval only, sometimes... :-)