Australia is a migration nation. You all know this. Over 29 per cent of our 26 million residents were born abroad.
That’s big in international comparison. Ever since the end of World War II, Australia has increasingly welcomed more migrants to the country.
Let’s quickly discuss the recent history – say 100 years or so – of migration to Australia and what the future of migration might look like.
Over the past decade, two-thirds of growth in the migrant population came from Asian nations, while the European-born population declined. Migration appears in cycles. Always has, always will.
For example, Greeks came to Australia in the 1950s and 1960s when we needed migrants in our factories and there weren’t sufficient economic opportunities in Greece. After the 1970s, only a few Greeks moved to Australia. Consequently, Greek-born Aussies are old now – 74 is the most common age.
Over the past 60 years, the Greeks changed Australia for the better by filling important working-class jobs, introducing superior food, and adding columns to family homes.
The recent shift in migration patterns from Western countries to Eastern countries is best visualised by looking at the Indian-born residents of Australia.
The most common age for an Indian-born resident is only 36. Once again, these migrants fill important jobs (this time mostly in highly-skilled occupations), add to the culinary richness (curry is now a stock standard dinner option in Australia), and integrate well into Australian society as they too obsess about cricket and home ownership.
In 2001, Indians were the 10th-largest migrant group in Australia. Today they are the second-largest group (just behind the slowly declining English). The Greeks moved in the opposite direction (ranked 7th in 2001 and 17th in 2021).
Migration recovery
Australia only loses population at scale (in net terms) to overseas destinations in times of extreme events.
World War I stands out in the chart below. A total of 334,000 Australians served overseas during that war. That accounts for the outflow peak in 1915 and 1916.
The only other sizeable net population loss in Australia’s recent history was the outflow of international students and skilled migrants during the COVID pandemic.
Assuming no further world wars or pandemics, we have reason to believe pre-pandemic migration levels will return soon. After all, Australia remains an attractive destination for migrants. Remember what we have to offer: a stable democracy, a functioning health system, a rich English-speaking nation, a decent lifestyle and the weather isn’t too bad either.
I argued in a previous column that our rapidly ageing population isn’t only expensive, but also very labour intensive to maintain. We need a lot of migrants to ensure our elderly have adequate care in old age.
If you are on board with the idea that we will continue to grow the Australian population base by a net of around 200,000 new migrants each year, you might not like the next part of the argument.
We are soon going to run out of global migration-age (18-39) population. I wrote a piece about that phenomenon too.
In the future, countries will compete for skilled migrants. This will take the form of tax cuts or even cash payments (if source countries with disadvantageous demographic profiles even continue to let their population leave). In my reading of future trends, the 2020s are likely to be the last decade in which Australia can attract migrants at scale without paying for them.
Citizenship
There is one major tool that Australia isn’t using adequately to ensure future migrant supply – citizenship.
We are making it unnecessarily expensive and bureaucratic for migrants to become Australian citizens. Only half of the migrants that have been in the country for a decade (see 2012 in the chart below) are already citizens.
Migrants, like everyone else, want basic security in their lives. The certainty to be allowed to stay in Australia permanently is only given once you received citizenship.
Migrants want to invest in Australia. Migrants want to know that their investments, in the form of property, taxes and columns near the front door, are not going to be taken away from them.
A transparent, less bureaucratic and cheaper way of securing citizenship might well be the key to ensuring a stable migration pipeline. Canada is outperforming Australia here, as they started handing citizenship out to their international students like candy.
We know from research into international students, how important the pathway to citizenship is for migrants.
Already, Indian students prefer Canada over Australia. The whole concept of operating as a migration nation will only get more challenging in the coming decades. If Australia doesn’t simplify the pathway to citizenship, we might see the share of the population that was born overseas drop slowly but steadily.
While this might sound comforting to some, our economy and older Australians in particular would be much worse off as a result.
