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4102.0 - Australian Social Trends, 2002  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 09/05/2002   
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Contents >> Population >> Population Projections: Fertility futures

Population Projections: Fertility futures

Under a very low fertility scenario of 1.3 babies per woman by 2008-09, Australia's population would peak at 23.2 million in 2039 and then decline to 22.9 million by 2051. At the other extreme, a high fertility rate of 2.1 babies per woman would see the population reach 30.1 million by 2051.

At various times since European settlement, Australian governments have expressed concern over slumps in the birth rate, believing the healthy growth of the population to be essential to the wellbeing of the country.1 In the latter part of the 20th century, Australia was one of many developed countries to experience sustained fertility decline. Since 1976, Australian fertility has been below replacement level, which will eventually result in the population decreasing. With such significant implications for the size and structure of the population, low fertility lies at the heart of many current economic, environmental, and social issues.

One of the most dramatic consequences of fertility decline is population ageing, which is already manifest in Australia (see Australian Social Trends 1999, Our ageing population). This is the inevitable result of sustained low fertility accompanied by increasing life expectancy. The ageing of the population will change the ratio of old to young, and the proportion of the population who are of working age. These shifts will affect many areas of social and economic activity, forcing change not only in the health and aged-care systems but in labour market structures and skills.


Births and population growth
This article uses data from two sources: births data derived from Birth Registrations; and ABS population projections which span the period 1999-2101 for Australia.

The total fertility rate is the sum of age-specific fertility rates (live births at each age of mother per 1,000 female population of that age). It represents the number of children a woman would bear over her lifetime if she experienced current age-specific fertility rates at each age of her reproductive life.

Replacement level fertility is the level that needs to be sustained in the long term to ensure that a population replaces itself and is currently estimated at 2.1 babies per woman in Australia.


Fertility decline
Over the course of the 20th century, Australian fertility, as measured by the total fertility rate, reflected changing social and economic conditions. Fertility was relatively low during the Great Depression of the 1930s, reaching 2.1 babies per woman in 1934. In 1961, at the height of the 'baby boom', it peaked at 3.5 babies per woman. Since then, fertility has declined, falling sharply during the early 1960s and again during the 1970s, and reaching replacement level (2.1) in 1976. The total fertility rate then stabilised somewhat during the 1980s, before resuming a more gradual decline during the 1990s (see Australian Social Trends 1996, Trends in fertility). At 1.7 babies per woman, the fertility rate recorded for 2000 was the lowest on record.

Explanations of fertility decline have centred around the far-reaching social and technological changes that have occurred in Australia, as in other developed countries, since the mid-20th century. The late 1960s and early 1970s saw major changes in access to birth control and abortion. In particular, the oral contraceptive pill became available in the mid-1960s, following which the total fertility rate fell to 2.9 babies per woman in the years 1966-71. Accompanied by changing laws and attitudes surrounding the role of women in society, these changes allowed women greater reproductive choice and greater freedom to pursue education and employment. As a result, female participation in the labour force increased dramatically in the late 1960s and early 1970s (see Australian Social Trends 1998, Trends in women's employment). The further slump in fertility during the 1970s, which saw the total fertility rate fall below replacement level, is largely attributed to this factor, along with changing views on family size and standards of living.

TOTAL FERTILITY RATE(a)

(a) Babies per woman.

Source: Births, Australia, 2000 (ABS cat. no. 3301.0).


In situations where it remains difficult for women to pursue both work and family goals, some are choosing to have fewer children or none at all, contributing to the continued decline in fertility. The current low level of fertility in Australia is a result of increasing proportions of women remaining childless and couples restricting their family size to one or two children. Both trends are related to the fact that partnering and childbearing are occurring at later ages than in the past, reducing opportunities to have children and limiting the likelihood of larger families. The median age of Australian mothers at first pregnancy (of the current relationship) resulting in a live birth has risen from 24 years in 1975 to 29 years in 2000 (see Australian Social Trends 2001, Older mothers; Australian Social Trends 2002, Trends in childlessness).

In reaction to these trends, 'family-friendly' policies such as paid parental leave and subsidised child care, which enable parents, and especially mothers, to combine work and family goals, are often advocated as the key to maintaining sustainable levels of fertility.2 Others argue that governments should cater to the diversity of parents' work and lifestyle preferences, supporting families in all choices made with regard to the care of young children, rather than focusing on the workforce participation of women.3 In either case, policy is just one element among many in the complex equation that determines fertility levels. Economic factors, such as the availability of employment, and access to affordable housing and child care, also have an impact on fertility;3 as does continued social change encouraging individualism and affecting the stability of couple relationships.4


INTERNATIONAL COMPARISON
According to the United Nations' 2000 projections, the world's average total fertility rate for 2000-05 will be 2.7 births per woman. While Australia's fertility is well below this level, it is comparable to that of other developed countries, most of which have also experienced sustained fertility decline. The projected total fertility rate for Australia (1.8) is lower than that of the United States of America (estimated at 1.9) or New Zealand (2.0), but considerably higher than that of countries such as Spain (1.1), Hong Kong (1.2), Italy (1.2), Greece (1.2), Germany (1.3) and Japan (1.3). These fertility rates contrast with those projected for developing countries, some of which remain as high as 8.0 babies per woman.

INTERNATIONAL TOTAL FERTILITY RATES(a), ESTIMATES AND PROJECTIONS

1950-1955
1975-1980
2000-2005
Country
rate(b)
rate(b)
rate(b)

Australia
3.18
2.09
1.75
China
6.22
3.32
1.80
Germany
2.16
1.52
1.29
Greece
2.29
2.32
1.24
Hong Kong (SAR of China)
4.44
2.32
1.17
Indonesia
5.49
4.73
2.27
Italy
2.32
1.89
1.20
Japan
2.75
1.81
1.33
New Zealand
3.69
2.18
1.97
Niger
7.70
8.20
8.00
Spain
2.57
2.57
1.13
United Kingdom
2.18
1.72
1.61
United States of America
3.45
1.79
1.93
World
5.01
3.90
2.68

(a) Average total fertility over 5 year periods, spanning from mid-year of the beginning to mid-year of the end of the period.
(b) Babies per woman.

Source: United Nations Population Division, 2001, World Population Prospects, The 2000 Revision, vol.1: Comprehensive Tables, United Nations, New York.


How low could fertility fall?
There is much debate about how low fertility will fall in the developed world. There are reasons to believe that countries with the lowest total fertility rates of 1.1 or 1.2 may have reached the limits of low fertility. It has been suggested that there is a biological component to the motives driving fertility (a 'need to nurture') which will ensure that the majority of women continue to bear at least one child.5 This view is supported by a number of studies showing that women still anticipate an average completed family size of two or more children, even if this goal is not ultimately realized by many6 (see Australian Social Trends 2002, Changes across Australian generations).

While Australian fertility may not fall to the levels experienced by countries such as Spain, Italy, or Hong Kong, further reductions in childbearing might reasonably be expected if the labour force participation of women continues to increase. Fertility in parts of Australia (notably Melbourne and the Australian Capital Territory) has already fallen to 1.6 babies per woman, and could decline further. The possibility that Australia's fertility could fall to 1.3 should not be discounted, given that the difference between a fertility rate of 1.3 and the middle level fertility scenario (total fertility rate=1.6) equates to around a third of Australian women having one child less.7

What if ....?
Small differences in fertility levels over the next 50 to 100 years could produce very different population outcomes. A change of just 0.1 in the total fertility rate over the whole of the projection period would result in the population being approximately 1.0 million larger or smaller in 2051, and 2-3 million larger or smaller in 2101.

The scenarios considered in this article demonstrate the extent to which the size and age structure of the population could be affected by different levels of fertility. If the total fertility rate is assumed to be 2.1 babies per woman (i.e. replacement level), Australia's population would reach 30.1 million in 2051 and 39.6 million in 2101, and would continue to grow steadily beyond this date. Given current trends, the likelihood of the total fertility rate rising to 2.1 and remaining at that level is small. Nevertheless, many argue that this level of population growth is desirable in the interests of economic growth. Others argue that the size of the resulting population would cause serious environmental degradation and that this rate of growth should be avoided in the interests of sustainability.

PROJECTED POPULATION SIZE(a) ASSUMING VARYING LEVELS OF TOTAL FERTILITY RATE(b)

(a) Projection assumes net overseas migration of 90,000 per year and life expectancy at birth rising to 83.3 years for males and 86.6 years for females in 2051, then remaining constant until 2101.
(b) Babies per woman.

Source: Population Projections, Australia, 1999 to 2101 (ABS cat. no. 3222.0).


Population projections
ABS population projections use the estimated resident population at 30 June 1999 as a base population. Population projections are not predictions or forecasts. They simply show what would happen to Australia's population if a particular set of assumptions about future levels of births, deaths and net overseas migration were to hold for the next 50 to 100 years. The assumptions about levels of future fertility, mortality and migration are based on long-term trends, current debate, and possible future scenarios arising from research in Australia and elsewhere. See Population Projections, Australia, 1999 to 2101 (ABS cat. no. 3222.0).

This article explores the possible impact on the Australian population of three very different fertility scenarios. Each scenario assumes that fertility reaches a certain rate in 2008-09 and remains constant at this level until 2101. Under the lowest fertility scenario, this rate is 1.3 babies per woman, a level already realised in some countries. The middle level scenario assumes a total fertility rate of 1.6. The third scenario, at a high level of 2.1 babies per woman, represents replacement level fertility. Migration and mortality, the other two factors affecting population growth, are held at the same level for all scenarios. Net overseas migration is assumed to be 90,000 per year, while life expectancy at birth is assumed to rise to 83.3 years for males and 86.6 years for females in 2051, then remaining constant until 2101.


At the other extreme, if fertility fell to 1.3 babies per woman, the rate of natural increase (the excess of births over deaths) would eventually decline. Population growth would initially continue while there remain large numbers of women of reproductive age having children, but after peaking at
23.2 million in 2039, Australia's population would decline to 22.9 million by 2051 and to 19.0 million by 2101. This scenario carries with it fears that Australia's economic growth and position in the Asia-Pacific region would be severely weakened by a smaller and declining population. These concerns have often resulted in calls to increase immigration. However, higher levels of immigration can do little to influence the age structure of the population and, in order to stem population decline, would need to be considerably higher than previously experienced in Australia.8

Under the more moderate assumption that the total fertility rate reaches 1.6 babies per woman, the population is projected to grow to 25.4 million by 2051, remaining around this level to the end of the projection period. A fertility rate of 1.6 would thus mean longer-term stability in the size of the Australian population, and as such has been nominated as the level below which Australian fertility ideally would not fall.7

PROJECTED POPULATION 2051(a): VARYING LEVELS OF FERTILITY

Total fertility rate (babies per woman)

1.3
1.6
2.1

million
million
million
Total population
22.9
25.4
30.1

%
%
%
Growth rate for year ending June 2051
-0.2
0.1
0.6

(a) Projections assume net overseas migration of 90,000 per year and life expectancy at birth rising to 83.3 years for males and 86.6 years for females in 2051, then remaining constant until 2101.

Source: Population Projections, Australia, 1999 to 2101 (ABS cat. no. 3222.0).


Population ageing
The impact of low fertility is most immediately evident in the younger age cohorts of a population. As the proportion of the population in these age groups shrinks, population becomes concentrated in older age groups. This effect is intensified by a projected increase in life expectancy, as more people survive into older age groups. This structural shift in the population age distribution towards older ages is known as population ageing. The result is a top-heavy population pyramid which has considerable momentum for further population decline, as smaller birth cohorts result in smaller cohorts of reproductive-aged women.

Even if it is assumed that fertility reaches 2.1 babies per woman by 2008-09, population ageing will occur, as the impact of past and present trends in fertility continue to be felt throughout the age structure. An increase in the median age may be used as an indicator of population ageing. If the total fertility rate were to fall to 1.3, the median age of the Australian population would rise, from 35 years in 2001, to 50 years in 2051, compared with 40 years in 2051, if fertility were to increase to replacement level (2.1 babies per woman).


POPULATION AGE AND SEX STRUCTURE: FIVE YEAR AGE GROUPS
2001 - Actual2051 - Projected, total fertility rate of 2.1
2051 - Projected, total fertility rate of 1.62051 - Projected, total fertility rate of 1.3
Source: Population Projections, Australia, 1999 to 2101 (ABS cat. no. 3222.0).


In 2001, the proportion of the population aged 0-14 years was 20%, while the proportion aged 65 years and over was 12%. Using total fertility rates of 1.3 and 2.1, the proportion of the population aged 0-14 years could decline to between 11% and 19% respectively in 2051. At the other end of the age scale, the proportion aged 65 years and over could increase to between 29% and 22% respectively. Under the medium-level scenario of 1.6 babies per woman, the proportion of the population aged 0-14 years would be 14% in 2051, while the proportion aged 65 years and over would be 26%.

The ageing of the population therefore effectively amounts to children progressively being replaced by older people. This shift has economic implications, as public expenditure on services for older people (e.g. health, housing and aged care) is greater than that spent on services for children (principally education and health).9 In addition, while most children are dependent on their parents' income, most older people are eligible for government income support. Concern has been expressed that the predicted increase in public expenditure necessitated by population ageing will occur in conjunction with a decrease in the size of the working-age population who may be expected to support such expenditure through taxation revenue. However, this prospect may be offset to some extent by rising female participation in the labour force. It is also true that the majority of older people are relatively healthy and live independently in their own homes, and that the increased prevalence of personal superannuation will result in larger numbers of self-funded retirees.10 Further, older Australians make significant contributions to their families and communities through voluntary work for welfare and community organisations, child care for grandchildren and other forms of caring.11

PROJECTED POPULATION AGE STRUCTURE 2051(a): VARYING LEVELS OF FERTILITY

Age group (years)

0-14
15-64
65 and over



Total fertility rate (babies per woman)
Median age
2051
Change from 2001(b)
2051
Change from 2001(c)
2051
Change from 2001(d)
years
%
% points
%
% points
%
% points

1.3
50
11.5
-8.8
59.5
-7.8
29.0
16.6
1.6
46
14.4
-5.9
59.6
-7.8
26.1
13.7
2.1
40.0
19.1
-1.2
59.0
-8.4
22.0
9.6

(a) Projections assume net overseas migration of 90,000 per year and life expectancy at birth rising to 83.3 years for males and 86.6 years for females in 2051, then remaining constant until 2101.

Source: Population Projections, Australia, 1999 to 2101 (ABS cat. no. 3222.0).


Endnotes
1 Ruzicka, L. and Choi, C. 1981, Australian Bureau of Statistics, 'Recent decline in Australian fertility', Year Book Australia 1981, cat. no. 1300.0, Australian Government Publishing Service, Canberra.

2 McDonald, P. 2000, 'Gender equity, social institutions and the future of fertility', Journal of Population Research, vol.17, no.1, pp. 1-16.

3 Manne, A. 2001, 'Women's preferences, fertility and family policy: the case for diversity', People and Place, vol.9, no.4, pp. 6-24.

4 Qu, L., Weston, R. and Kilmartin, C. 2000, 'Effects of changing personal relationships on decisions about having children', Family Matters no.57, pp. 14-19.

5 Foster, C. 2000, 'The limits to low fertility: a biosocial approach', Population and Development Review, vol.26, no.2, pp. 209-234.

6 Bongaarts, J. 1999, 'Fertility decline in the developed world: where will it end?', The American Economic Review, vol.89, no.2, pp. 256-260.

7 McDonald, P. 2000, 'Low fertility in Australia: evidence, causes and policy responses', People and Place, vol.8, no.2, pp. 6-21.

8 McDonald, P. and Kippen, R. 1999, 'The Impact of Immigration on the Ageing of Australia's Population', Department of Immigration and Multicultural Affairs Discussion Paper.

9 Australian Bureau of Statistics 2001, 'Issues Associated with an Ageing Population', paper presented at Australian Statistics Advisory Council Meeting.

10 Kinnear, P. 2001, 'Population Ageing: Crisis or Transition?', Australia Institute, Discussion Paper No. 45.

11 Australian Bureau of Statistics, 1999, Older People, Australia: A Social Report, cat. no. 4109.0, ABS, Canberra.


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