Published daily by the Lowy Institute

Why a prosperous nation needs migration

Why a prosperous nation needs migration
Published 17 Feb 2016 

Australia's population reached 24 million in the very early hours of Tuesday, 16 February, according to the Australian Bureau of Statistics. In response, former Foreign Minister Bob Carr has called for the government to cut its immigration intake by as much as 50%.

Mr Carr's response reflects frustration about the growing immigrant population and the subsequent pressure on housing, transportation and other element of daily life. Of course, he is hardly alone in such concerns. Public sentiment against immigration has increased worldwide. But, while it is true that many governments struggle to keep up with infrastructure challenges and subsequent socio-economic issues, public figures should resist the temptation to paint immigration as a threat to the Australian way of life. On the contrary, a well-managed immigration program is absolutely essential to safeguarding Australian prosperity in years to come.

If Australia wants to advance as a nation, it needs more people. The average number of babies Australian women have is now less than two (last year the fertility rate hit a 10-year low of 1.8). With zero net migration, Australia's population would remain steady at around 25 million from 2045. However the composition of that population would include many more elderly people and not enough working age people to support them. 

As Table 1 shows, in the last two decades, our population has increased in line with migration. Last year, 53% of total population growth was the result of immigration and 47% by natural increase (births minus deaths).

Table 1: ABS Explanatory notes can be found here.

Of the various categories that make up the migration intake, for the last two decades, the bulk has come from skilled migration rather than family and humanitarian programs (see Table 2). This reflects policy priorities as expressed by the Department of Immigration and Border Protection, which says: 'The purpose of migration is to build the economy, shape society, support the labour market and reunite family.' [fold]

Table 2

Mr Carr said Australia has 'a third-world style population growth rate'. This is not exactly true. Yes, Australia's 1.42% growth rate in 2015 was higher than the world's average of 1.13%. However, it's nothing like the world's highest, which is Niger at 4.1%. It's also lower than Israel (1.59%) and Singapore's 1.66% (both developed countries), according to the UN Population Division. 

Let's get some more international perspective. The world population reached 7.3 billion in 2015. China and India are the most populated countries, each with more than one billion people. In terms of population density, the world's megacities each have a larger population than Australia. Greater Tokyo has over 37 million, Delhi has approximately 26 million, and New York has around 24 million. The map below demonstrates the density of population in South and East Asia, Western Europe and East and West Coast of the US. To outsiders, Australia looks like an immense land blessed with natural resources and good weather, and with plenty of room for more cities built either by its own labour force or by temporarily borrowing overseas labour through immigration.


However, Mr Carr has chosen to make migration an argument about national identity, saying 'we (Australians) would lose "something of ourselves” by having to "live in a unit in a high-rise tower"'. It is not exactly clear what Carr means. It could be interpreted as a view that the many already living in high-rise tower units are somehow un-Australian.

Even more puzzling was Mr Carr's insistence that reducing overall immigration was 'compatible' with Labor's plans to increase Australia's refugee intake. Reducing immigration by up to half (around 100,000) and increasing refugee intake (currently fixed at around 13,750) means Australia would have less skilled and family migrants who are working, and more refugees who are more likely to rely on government services. This seems to be at odds with his view that Australia's economy should focus on export-led growth and stop relying on an expansion in its domestic market. Surely Australia would need more workers, managers and professionals to achieve this. If they are not coming from natural increases (due to our comparatively low fertility rate) or from immigration, where are these people going to come from?

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