FACTBase Bulletin 56 - Sizing Ageing in Western Australia

This Bulletin has been prepared as part of the Committee for Perth’s Bigger & Better Beyond the Boom project. The Bulletin provides an overview of ageing in Australia, Western Australia (WA) and the Perth and Peel regions. Specifically, it outlines the age structure of the population, ageing trends, and the impact that this is having on the ratio of the working population to dependent population (dependency ratio) and working population to the population over 65 (older dependency ratio). It also considers the geography of ageing in Perth and Peel.

The Bulletin articulates the broad, predicted impacts of ageing on the economy, including the workforce, public spending and society. It also provides an overview of strategies identified in recent published literature to address potential negative impacts and take advantage of opportunities associated with longer life expectancy.

Key Findings

• The populations of Australia and Western Australia are ageing. Population ageing is not unique to Australia. The populations of all OECD member countries are ageing, albeit at differing rates. The fastest pace of ageing has been recorded in Japan, where over 65s made up 25% of the population in 2014.
• In 2016, there were 49 dependents for every 100 people of working age in Australia. This includes 20.6 adults aged over 65 for every 100 adults of working age; and 28.2 children aged under 15 to every 100 adults of working age. By contrast, in 1901 there were 57.9 children for every 100 people of working age in Australia and just 6.6 people aged 65 or older for every 100 people of working age.
• Ageing in WA is occurring at a similar pace to that of the rest of the nation. In 2016, the age structure of WA’s population almost mirrored the structure of the population nationally, with 50% of West Australians being of working age; 29 children for every 100 people of working age; and 21 adults aged 65 for every 100 people of working age.
• Looking forward, Australia’s ageing trend is predicted to continue and is likely to lead Australia “into a demographic environment entirely unfamiliar to us” (PC, 2013, pp. 54). By 2060, it is predicted that 1 in 4 Australians will be aged over 65. There is also projected to be very high growth rates among Australia’s ‘oldest old’ and by 2060 there are projected to be 25 centenarians for every 100 children aged under 1.
• By 2100, the total number of ‘dependents’ in the population is projected to increase from 49 per 100 people of working age to 79.5 per 100 people of working age.
• Literature indicates that in countries where the growth rate of the working population is slower than the growth rate of the total population, the share of the population that is of working age starts to decline and this has a negative impact on the economy
• In Australia, ageing is projected to impact on the economy by influencing: People: reductions in the proportion of people of working age and size of the labour force; Participation: increase in the proportion of the population over 65 who have lower rates of labour force participation; Productivity: increased role of less productive industries combined with an expected fall in hours worked per capita is projected to lead to a fall in GDP; Consumption: expenditure among households containing adults over 65 is lower than ‘working age’ households and the types of products and services consumed by these households differ; Public expenditure: the combined impacts of ageing and new health care technologies are predicted to place major pressure on the budgets of Australian governments.
• Populations in all local authorities in Perth and Peel aged structurally and numerically from 2011-16. In 2016, local authorities with the highest proportion of people aged over 65 were the Town of Claremont and the City of Mandurah, and the highest densities of people aged 65 or over were found in local authorities in central locations, including the Town of Claremont and City of Subiaco.
• Highest rates of numeric ageing are evident in peripheral local authorities in the Peel region and in local authorities in the north-west, such as Joondalup.
• Research has determined that most older people in Perth and Peel ‘age in place’ and, when they do move, they are most likely to remain within their local area. Therefore, as peripheral suburban locations become more established, so their populations will age. This has been identified as a significant issue moving forward because urban design, transport systems and access to services in peripheral locations tend to be less suitable for older Australians.
• Strategies for ageing populations are focused towards two primary aims: 1) to realise the potential economic benefits of an ageing population; and 2) to minimise the economic impacts of an ageing population. To date, most policies have primarily focused on reducing the negative economic impacts of population ageing, rather than seizing economic opportunities associated with this trend. Key strategies to mitigate the economic impacts of ageing include, increasing labour force participation among over 65s and all working age Australians, most notably working age females.
• Moving forward, there will need to be increased emphasis on maximising economic and societal benefits associated with living longer. Key strategies aimed at realising the potential benefits of an ageing population include developing new and innovative businesses associated with health care products and services; encouraging entrepreneurship among older Australians; and increasing and recognising volunteering and philanthropy among older Australians.