High Immigration Levels Boost Australian Economy: Reserve Bank Governor

The R.B.A. Governor, Philip Lowe, believes that high immigration level has ensured great growth and has helped in arresting the crisis of an ageing population. Presently, Australia has a high fertility rate as a result of its better immigration level.  It has worked as a positive for the economy and has also changed the demographic profile. Australia now has a young population among advanced economies. These comments come at a time when the federal government has witnessed reduction in Australia’s migration intake by 10%. In 2002, there was an expectation that Australia’s population would age quickly. The projection of median age will touch 45 years by 2040.

Furthermore, after a decade of more immigration of the young, the present estimate says that the median age in 2040 would be only 40 years. This features a huge change in a short period of time. Additionally the new migrants in recent years are younger compared to the resident population. Clearly foreign migration is driving up the population growth. In the past five years, 80% of net overseas migration happened by people below the age of 35 years. R.B.A staff examined demographic trends for the next 25 years for 37 advanced economies using UN data. Here Australia had a fine placed than other comparable countries. The old-age dependency ratio was slow in rising.

This will have a set of implications in the future economic growth of the country. The unemployment rate will decrease to 5% over the next few years. Finally the inflation was expected to rise to 2.5% from 2.1% by 2020. Thus there is a need to consider these facts, and reduce the anger of policies, directed against immigrants.