Addicted To Migration – Australia’s Falling Productivity And The Cost Of Relying On Migration For Economic Growth

Written by: and
11 December 2023
Addicted To Migration – Australia’s Falling Productivity And The Cost Of Relying On Migration For Economic Growth - Featured image

Australia’s economic growth in 2023 was entirely due to population growth—driven by migration—and increased labour participation at the expense of productivity growth:

  • In the 2023 financial year, labour productivity declined by approximately 3.6 per cent—the most severe productivity decline since at least 1980.
  • Also in the 2023 financial year Australia experienced the highest population growth on record.
  • Population growth accounted for 85 per cent of total real economic growth in the 2023 financial year, the highest in any normal year on record.

Australia’s dependence on population growth to keep economic growth positive has been increasing consistently over the 30 years between 1990 and the last pre-pandemic financial year (2019):

  • From 1990 to 1999, population growth contributed approximately one-third of total economic growth.
  • From 2000 to 2009, population growth contributed approximately one-half of total economic growth.
  • From 2010 to 2019, population growth contributed approximately two-thirds of total economic growth.

The trends in population and productivity have coincided with a decline to per capita gross domestic product between January 2023 to June 2023, leaving Australian families worse off:

  • Australia’s increased reliance on migration meant that Australians in 2023 were approximately $7,848 poorer on a per capita basis.
  • Between 2000 and 2023, Australians were cumulatively $80,038 per person worse off. This is approximately one year’s worth of income per person lost over the past 23 years because of the country’s increased reliance on migration to achieve economic growth.

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