The Australian Government released the Intergenerational Report 2023.
By 2062-63, 40 years from now, Australia’s economy will be about two and a half times larger than it is today, while real incomes will rise by about 50 per cent.
Five major forces will shape the Australian economy in the coming decades: an ageing population, the expanding use of digital and data technologies, climate change and the net zero emissions transition, growing demand for care and support services, and increasing geopolitical risk and fragmentation.
The report predicts that Australia, like other advanced economies, will experience a decline in economic growth over the next 40 years, averaging 2.2 per cent a year. At the same time, Australia’s population growth rate will also slow, from 1.4% to 1.1% per year. By 2062-63, Australia’s population will reach 40.5 million. Immigration will continue to contribute to Australia’s population growth over the next 40 years, but the proportion of migrants in the total population will decline.
In addition, Australia’s population will continue to age over the next 40 years. The number of Australians aged 65 and over will more than double, those aged 85 and over will more than triple, and the number of centenarians is expected to increase six-fold.
As the population ages, Australia’s workforce participation rate – the proportion of people in the paid workforce – will fall from 66.6 per cent today to 63.8 per cent in 2062-63.
Digitalisation will transform the way Australians work, increasing productivity, improving workplace safety and giving people the flexibility they need to tackle the challenges of the future. Climate change will have a profound impact on Australia’s economy and society, it will affect where and how Australians choose to live and work, the country’s food and energy security, and Australia’s environment.