Supply and demand; Australia as an ageing nation

Tuesday, March 21, 2017

DEMAND: AUSTRALIA AS AN AGEING NATION

A CLEAR AGEING TRAJECTORY

Australia is experiencing a baby boom, with births exceeding 300,000 a year. 30 years ago, the over 65s made up just 11% of our population (one in nine persons). Today the over 65s make up 15% of our population (one in seven). Forecasts project that this cohort will make up 18% in 2027 (one in six). By 2047 one in five Australians (20%) will be aged over 65.

AGEING SOCIETY

Our median age is also increasing. Three decades ago the median age of an Australian was 31.3. Today it is 37.4 and in 2047 it is projected to be just under 40.

85+ POPULATION

The over 85s, where there is an even greater need for aged care services, are growing at a faster rate than the over 65s. In 1987 there were 133,448 Australians aged over 85. Today there are four times as many, and in 2047 there will 14 times as many.

INCREASED LONGEVITY

Not only are there more older people in our nation, but Australians are living longer than ever before. Life expectancy at birth in 1987 was 76.3, whereas today it is 81 for a male and 85 for a female. In 2047, it is projected to 89.9.

HEALTH ADVANCEMENTS ARE INCREASING LONGEVITY

The primary enabler of this increased longevity gain has been the health system rather than individual behaviour. Life expectancy increases will continue because of improved medical technologies, public health infrastructure and better public health measures. New and improved medical interventions will also contribute, as will the improved survivability rates of major illnesses and cancers.

A decade ago, dementia and Alzheimer’s disease were the 6th largest causes of death in Australia. Today they are the 3rd leading causes of death with the number of deaths having more than doubled to 9,864. Over the same period of time, deaths due to the first and second causes of death (heart disease and brain disease) have been decreasing. If today’s current trend continues, by 2021 dementia and Alzheimer’s disease will be the leading cause of death in Australia.

EXPONENTIAL GROWTH OF CENTENARIANS WILL KEEP THE QUEEN BUSY

In 1952, the year that Queen Elizabeth II became sovereign, 40 letters of congratulations would need to have been written to Australians turning 100. This year, 2,925 Australians will turn 100 and in 10 years 5,401 will turn 100. In 30 years the number of congratulatory letters written to Australians turning 100 will increase to 25,938 in the year 2047.

SUPPLY: AUSTRALIA AS AN AGEING NATION

THE CHALLENGE OF SUPPLY

Not only is there an increasing demand on the services provided by the aged care sector with the growing number of over 85s, there is also a workforce supply challenge.

RATIO OF WORKERS TO RETIREES DECLINING

The ageing population will place greater demands for productivity on the labour force. In 1975 for every person of retirement age there were 7.1 people in the working age population. By 2015 there were just 4.5 people of working age for every individual of retirement age, and this is projected to decline to just 2.7 people of working age for every individual at retirement age by 2055.

IMPENDING RETIREMENTS

Because of the high median age of an employee in the aged care sector, half of the aged care workforce will be of retirement age in 15 years. There are 350,000 workers in the aged care sector (estimated in 2012), so this equates to an average of 11,667 retirements per year for the next 15 years. This averages to 972 farewell lunches per month!

If we are to keep the current ratio of aged care workers to people aged over 85 in our nation, we need to add 129,945 workers in the next 10 years. This equates to recruiting 1,083 new workers per month, in addition to replacing the 972 retiring staff per month.

That’s a total recruitment goal of 2,055 each month – adding nearly 25,000 individuals to Australia’s aged care workforce each year.

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To find out more about McCrindle's expertise in the aged care industry, or how we can communicate these insights to your team, please get in touch.

Australia in 2034: What will our nation look like in 20 years?

Thursday, September 11, 2014

By 2034 Australia will have 33 million people and the dream of owning that quarter acre block will be nearly gone. What will Australia look like, how is our workforce changing, will households be smaller and will we recognise this new version of the ‘Aussie Dream’?

Mark McCrindle addresses these issues on a recent segment of Channel 7’s Morning Show. Australia is currently the fastest growing OECD nation and in 20 years time we will have an additional 10 million people calling Australia home. “It’s going to continue to boom, “ Mark says. “We are adding almost a million people every 2 years. And we are the fastest growing developed nation on the planet at the moment.”

Whilst a population boom brings the bonus of size, economies of scale and diversity in our cultural makeup it can also have negative impacts. The pain will be felt in rising house prices, traffic congestion and increased waiting time for public services. The increase in housing density will mean that the vast expanse of the Australian outback will remain virtually as it is but the major cities will continue to expand, particularly upwards, with more people living in apartments than ever before. The cherished Aussie dream of the quarter acre block will be gone, replaced by new land release block sizes which currently average 423 square metres or a tenth of an acre block.

Just as the population will grow larger it will also get older with more people aged over 85 years than ever before. People are living longer and living alone for longer, leading to an increase in at home care and multi-generational households. The rise in house prices coupled with an ageing population will see many families living living together with mum and dad caring for their own children as well as for their ageing parents. Mark explains, “We’ve been on this trend of smaller households for a century. We had 4.5 people per household 100 years ago. Now we are at 2.6 but we’ve turned the corner and we’ve got slightly larger households now, not that we are having more kids, just that we have more people under the one roof because of housing affordability.”

‘Density’ will be the word to describe Australia in 2034. More people will be living in more households on smaller bocks of land with more houses and apartments per square kilometre. There will be more people but fewer people of working age relative to the growing population. Mark says, “We are going to have older workers – the population is growing, Australia is going through a baby boom and people are living linger. Yet the working age proportion is not keeping pace with that population growth. So now we’ve got about 5 people for every retiree but in 40 years time we’ll have about half that – 2.7 people of working age for every retiree”. As a result people will be working longer with many not retiring until well into their 70’s! However, life expectancy at birth will be almost 90 by then.

Australia will be bigger, older, denser and even more multicultural in 20 years time! Some ‘Aussie Dreams’ will have disappeared such as the ‘quarter acre block’ and along with it the Hills Hoist garden shed and enough space for a game of backyard cricket. But no doubt new ‘Aussie Dreams’ will come to replace them – it is the Lucky Country after all!

Demand Vs. Supply: Australia's Aged Care Puzzle

Tuesday, May 06, 2014

With Australia’s ageing population, increased life expectancy and longevity, there are growing demands for aged care in our nation.

Australia’s aged care sector is under pressure to meet this growing demand while at the same time facing significant recruitment and workforce challenges with half of the current aged care workforce reaching retirement age in the next 15 years.

McCrindle crunches the numbers in the latest infographic, the Aged Care Puzzle, to determine the magnitude of the demand versus supply gap.

Embed this infographic

THE CHALLENGE OF DEMAND

Australia as an ageing nation

Australia is experiencing a baby boom, with births exceeding 315,000 a year, as well as an increasingly ageing population. The over 65s make up 15% of our population today, and forecasts project that this cohort will make up 17% in 2024, and by 2044, 1 in 5 Australians (20%) will be aged over 65.

Australia’s population pyramids visually show the growth of our ageing population, and in 2044 our population pyramid will become inverted with the number of over 60s outnumbering the under 18s for the first time. Our median age is also increasing – three decades ago the median age of an Australian was 30.5, today it is 37.3 and in 2044 it is projected to be 40.

The over 85s, where there is an even greater need for aged care services, are growing at an even faster rate than the over 65s. In 1984 there were 120,862 Australians aged over 85, today there are 4 times as many, and in 2044 there will be 14 times as many.

Not only are there more older people in our nation but Australians are living longer than ever before. Life expectancy at birth in 1984 was 75.8, whereas today it exceeds 80 for a male and 84 for a female. In 2044, it is projected to be 90.4.

Health advancements are increasing longevity

The primary enabler of this increased and ongoing longevity gain has been the health system rather than individual behaviour. Life expectancy increases will continue because of improved medical technologies, public health infrastructure, better public health measures, new and improved medical interventions and the improved survivability rates of major illnesses and cancers.

The health system is also what will keep us living longer in the future. With Australians living longer than ever before, there will be an increasing need for procedures and medical intervention, and a growing expectation from the public that these services will continue to be provided.

A decade ago, dementia and Alzheimer’s disease were the 6th largest causes of death in Australia, accounting for 4,364 deaths in 2002. Today they are the 3rd leading causes of death with the number of deaths having more than doubled to 9,864. Over the same period of time, deaths due to the first and second causes of deaths (heart disease and brain disease) have been decreasing. If today’s current trend continues over the next decade, by 2021 dementia and Alzheimer’s disease will be the leading cause of death in Australia.

With little change in the retirement age and an increase in longevity, the retirement years have increased and the years for which supported care is needed has also increased. Not only is our population larger, our population is also living longer.

Exponential growth of centenarians will keep the Queen busy

In 1952, the year that Queen Elizabeth II became sovereign, 40 letters of congratulations would need to have been written for Australians turning 100. This year, 2,643 Australians will turn 100 and in 30 years the number of congratulatory letters written to Australians turning 100 will increase to 18,567 in the year 2044.

THE CHALLENGE OF SUPPLY

Not only is there an increasing demand on the services provided by the aged care sector with the growing number of over 85s, there is also a workforce supply challenge.

Ratio of Workers to Retirees Declining

The ageing population will place greater demands for productivity on the labour force. In 1970, for every couple of retirement age there were 15 people in the working age population, by 2010 there were just 10 people of working age for every couple of retirement age, and this is projected to decline to just 5 people of working age for every couple at retirement age by 2050.

An Ageing Workforce

Along with our ageing population, we also have an ageing workforce. Today the median age of an Australian is 37.3 and the median age of a worker is 40. However this varies across sectors – for example, the median age in the retail sector is 33.4, finance 37.3, construction 38.5, health 41.1, education 42.1. However in the aged care sector this ageing is even more pronounced – the median age for a residential direct care worker is 48 and community direct care workers is 50 years which makes it the sector with the highest median age of an employee.

Impending retirements

Because of the high median age of an employee in the aged care sector, half of the aged care workforce will be of retirement age in 15 years. There are 240,445 workers in the aged care sector, so this equates to an average of 8,015 retirements per year for the next 15 years, which averages to 668 farewell lunches per month.

If we are to keep the current ratio of aged care workers to people aged over 85 in our nation, we need to add 77,976 workers in the next 10 years, which equates to recruiting 650 new workers per month, in addition to replacing the 668 retiring staff per month.

A Growing Need

In the next 30 years Australia will see an unprecedented rate of growth of the over 85s in our nation. In 2044 there will be 1.2 million more people aged over 85 than there are today, and the average older Australian will live 5 years longer than today which equates to adding 6 million more years of care just for the increased number of over 85s and just to manage their increased life expectancy.

Download the analysis and the infographic.

Click here to download this file


Retirement Villages: ‘The Quiet Achievers’ – Australia’s Highest Rated Industry

Thursday, December 19, 2013

Australia’s largest and most comprehensive census of retirement village residents, the bi-annual McCrindle Baynes Village Census 2013, profiled over 5,200 retirement village residents nationally to identify the decision drivers that motivate nearly 20,000 senior Australians to make the life-changing move to a village each year.


Australia’s highest rated industry by customer rating: +25 score


Incorporated in the research, set to be released today, is a measure of the Net Promoter Score (NPS), a methodology created by Bain & Company to rate the value perceived by customers of a product or service delivered by a corporation or industry.

The most recent study of 19 Australian industries by Bain & Company delivered scores ranging from -44 (gas utilities) to +24 (online retail), with only 3 industries scoring a positive rating.

The retirement village industry, according to the November nationwide research study, scored an Australian industry leading +25 utilising the Bain & Company research technique on the question, “How likely is it that you would recommend this village to a friend?”

This compares to the average Australian industry NPS which is -15.

In fact, 98% of these ‘village people’ report being “somewhat to extremely satisfied”, with their village.

Mary Wood from the Retirement Living Council says these results are a validation of the retirement village sector’s contribution to our society:

“This report confirms that for the vast majority of people who have moved into a retirement village, the reality is just as good or better than they expected: more independence, better health, greater social interaction, increased confidence and physical security.”


2,200 Villages: One in every community


Across Australia there are over 2,200 retirement villages, providing accommodation for over 170,000 seniors over the age of 55 and up to 100+ years of age.

The Net Promoter Score was consistent across the 236 villages surveyed irrespective of whether they were operated by not-for-profit operators such as Blue Care in Queensland or large private operators such as RetireAustralia.

The three top reasons new residents chose to leave their previous home (the Push Factors) were to downsize while they still could (84%), their home was becoming too big to manage (62%) and concern about their future health (60%).

The three top reasons they liked their new village home (the Pull Factors) were that they could stay independent (87%), they had a safe environment with emergency support (87%) and were able to access village facilities (87%).


Downageing retirees: Living longer, active later, enjoying life


Residents living in retirement villages are on average older than a decade ago, with 95% aged 65+. While legislation specifies you must be 55 or older to join a village, today the average age of entry is 76. Over half (54%) of village entrants over the past two years were aged 75 or older and 1 in 3 (32%) aged 80 or above.

Approximately 8% of Australians aged 75 or older live in retirement villages.

Yet while village residents are older chronologically, they are younger from a longevity perspective than a generation ago. The recently released ABS Measure of Australia’s Progress indicates that in the last 40 years, life expectancy has increased by 10 years.

The 76 year old of today has the same life expectancy and to some extent, vigour, as the 66 year old a generation ago, explaining the significant delay in age of residents first entering retirement village living.

Social demographer Mark McCrindle summarises the situation, “Today’s village residents are downagers – a generation that are younger than their years would suggest. They’re living longer, active later, using technology more and even working later in life than previous generations of retirees. More than 1 in 7 of the retirement village age group are still in paid employment and based on these trends we will see increasing numbers of retirement village residents who are not in fact retired!”


Don’t worry, be happy: Overall happiness and life satisfaction increases when joining a village


Christopher Baynes, publisher of the village directory website villages.com.au who commissioned the report, says, “The results are consistent with our 2011 McCrindle Baynes Census and the feedback we get from the traffic on our website. Over 11,000 people each week search with us for a retirement accommodation solution”.

“The NPS score is not a surprise. We talk to residents every day across Australia. The feedback we receive is residents love the sense of community and security that a village delivers.”

Of the 1,220 people surveyed who had joined a village in the last two years, 30% stated their overall ‘happiness and life satisfaction’ had ‘increased significantly’ and a further 29% stated it had ‘increased slightly’ since moving into the village – a total of 59%. Just 7% stated that ‘happiness and life satisfaction’ had ‘decreased.’

Christopher Baynes comments: “What other industry or sector or service can claim to actually increase the happiness and life satisfaction for customers who are 75 years or older, with both the health and financial challenges that most face? It’s a pretty good place to be”.


About this Study: The McCrindle Baynes Villages Census 2013 was a national paper and online survey made up of 46 questions and completed by 5,220 retirement village residents from 23 village operators, equally distributed between private operators and not-for-profit church and charity operators.


Click here download the executive summary of the McCrindle Baynes Villages Census 2013:

The Downageing Generation

Monday, September 09, 2013

Australians are living longer than ever before and this remarkable growth in longevity is the primary cause of our ageing population. 

With Australians living longer, they are also working later and remaining active as grandparents more and later in life than ever before.

Many older Australians are in a life stage significantly younger than their age. 20th Century expectations of age can no longer be applied in the 21st Century, as traditional demographics don’t match new psychographics. From technology uptake to working longer, older Australians are not just “retired and wired” but working, leading and influencing later in life than has ever been seen.

Here’s a demographic snapshot of the downageing situation:


Comparative analysis of Australia’s 60-year-olds


1953

2013

National population

The total population has more than doubled.

10 million

23 million

Average age of becoming a grandparent

Grandparents are older chronologically but younger psychologically.

54-56

58-60

Life expectancy at birth

We can expect to live 12 years longer today than in 1953.

M:67

F: 73

M:80

F: 84

Life expectancy at 65

65’s of today are like 58’s of a generation ago in terms of longevity.

12-15

19-22

Source: McCrindle Research, ABS



Australia’s new grandparents: Younger than their parents were at the same age


Australia’s new grandparents, aged 60 are the Baby Boomers. Since the Boomers (born 1946-1964), we’ve seen Generation X (born 1965-1979), Gen Y (born 1980-1994) and this year Generation Z (born since 1995) enter adulthood and the Boomers are now grandparenting Generation Alpha.

But they are a generation of “downagers” – younger than their parents were at the same age, younger than their age would suggest, and based on the life expectancy rates, a 65 year old grandparent is more like a 58 year old of a generation ago.


Statistical summary of today’s downageing population


  • Demographic mid-life for an Australian has been pushed back to 50 years for a male, and 52 for a female in terms of adult years lived (since turning 18) and adult years to go (32 years lived since turning 18 and 32 years life expectancy for a male aged 50, and 34 adult years lived and 34 to go on average for a female).
  • The median age of employed persons in industries such as Education and Health is now 45 years – so while there are many workers in their 20’s, there are many in their 60’s, resulting in a median age of 45.
  • Today's grandparents are a working generation: 1 in 4 males aged 68 are employed full time, and 1 in 10 females aged 68 are employed full time.

Remember that many of today’s 60-something leaders have been in leadership since their 20’s and 30’s – they were needed during the boom years of the 50’s and 60’s. They also see no need to stop leading – having gained experience through decades and a lot of life left, they continue leading many of Australia’s businesses and industries.

For further research and an occupation breakdown of workers 65+, see our entry Older Workers, Downagers, and Redefining Retirement.

Older Workers, Downagers, and Redefining Retirement

Monday, May 13, 2013

Older Workers in Australia, Downagers, Redefining retirement

Australia’s ageing continues


In just two decades Australia’s median age has increased nearly 5 years (from 32.7 to 37.5 today). In the last 5 years the proportion of our population aged under 20 has declined by a percentage point to be just 1 in 4 Australians (25%) while the proportion aged over 60 has increased by a similar amount to be 1 in 5 (20%). Based on these current demographic trends, by 2028, for the first time in Australia’s history there will be more people aged over 60 than aged under 20.

Click here to download this report as a PDF.

Click here to download this report.


A good news story


The ageing of our population is of course a good news story. The Standardised Death Rate (deaths per 1,000 population) continues to fall (to 5.59- half that of births) while life expectancy continues to rise.

When Australia’s Age Pension was introduced in 1909, life expectancy at birth was 57 while today it exceeds 80. While the accessibility age of 65 for males has not changed in a century, longevity certainly has. In fact so dramatic has been the increase in life expectancy, that averaged across males and females, Australians have gained 25 years of life expectancy in the last 100 years. Or 3 months of life every 12 months of time!


Downagers: redefining the older life stages


Today’s Baby Boomers are the ultimate downagers, redefining lifestages, and reinventing retirement. They have adult children at home longer, they’re buying and selling property later in life, and remaining active in the workforce later than ever before. This is a response to the improved life and health realities. In fact based on years of life expectancy, a 65 year old today is the equivalent of a 54 year old in 1950. It is therefore of little surprise that Australians are younger longer and working later.


Older workers: technical, professional and entrepreneurial


Australia’s workers aged 65 and older currently comprise 3.4% of Australia’s total workforce (393,000 out of 11, 589, 000). The top two job categories of older Australians where more than 1 in 5 are aged 65 or over are professionals (21.4%) and managers (20.4%).

Occupation Breakdown of Workers Aged 65+

Of Australians 65 and over currently in the workforce, 72% are employees, 23% have their own business, 4% are employers, and 1% are contributing family workers.

Older Australians work the longest hours employed as managers in numerous industries (35 hours per week) and the least hours when employed in the community and personal service work industry (18 hours).

Across all of the industries, the average Australian worker aged 65 and older works 27 hours per week as an employee, 36 hours per week as an employer, 26 hours per week as a business owner, and 18 hours per week as a contributing family worker. Older workers are looking for great flexibility in their working hours and are increasingly not working full-time.

41% of Australians aged 65 and older who work as managers run their own business. This is the highest rate of self-employment across the major industries for this age group. Other industries that display a high percentage of older Australians running their own businesses are technicians and trade workers (27%), labourers (26%) and business services (20%).


Occupation/Industry

Total employees
aged 65+

% of all employees

Average hours worked

Professionals

84,000

21.4%

27

Managers

80,000

20.4%

35

Clerical and Administrative Workers

59,000

15.0%

23

Labourers

47,000

12.0%

21

Technicians and Trades Workers

41,000

10.4%

28

Machinery Operators and Drivers

33,000

8.4%

28

Sales Workers

26,000

6.6%

25

Community & Personal Service Workers

24,000

6.1%

18

TOTAL

393,000

100%

27

As the Director of McCrindle Research, Mark McCrindle headed up the McCrindle Baynes Village Community Report – the largest study into retirement village residents ever conducted in Australia. The project involved a 57 question pen and paper survey, deployed to 181 villages managed by 7 operators. It received over 10,000 completed surveys, representing almost 1 in 10 village residents Australia-wide.

Want to know more?

Click here to download our Speaking and Research Pack for the Retirement and Aged Care Sectors.

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What we do and how we do it at McCrindle Research

Tuesday, April 16, 2013

Seven years ago McCrindle Research began in a spare room of Mark and Ruth McCrindle’s house. With a psychology background, market research experience, and a passion to conduct world class research, Mark began the McCrindle Research story. 

Since then we’ve been commissioned by scores of clients, completed hundreds of projects, interviewed thousands of people, analysed hundreds of thousands of online survey responses, and interpreted millions of data points for our demographic summaries. Our research has been disseminated through hundreds of media articles, more than 10,000 of Mark’s books, and more than 100,000 of our acclaimed A5 population maps.

As Australia’s leading data visualisation researchers, our infographics, slide decks, whitepapers and research summaries have been meeting quite a need for world class research and analysis communicated in relevant, innovative ways. Our analytics tells us that they’ve been getting thousands of views and downloads each day. 

So if you are looking to analyse your market, identify consumer segments, understand the demographics, engage with diverse generations, or respond to the emerging trends, then check out our research packs, Mark’s speaking pack or get in contact for a quote. Through commissioned research projects, focus groups and online surveys, demographic reports, strategic workshops, and keynote presentations, we help organisations know the times.

A Ferrari or a Baby? Financial challenges for Australian parents

Tuesday, October 23, 2012

Ferrari or a child | McCrindle ResearchA post by Mark McCrindle.

With living costs rising, housing affordability challenges, and young Australians starting their earning years later in life after earning a degree, and a study debt, the costs of raising children is a key part of the discussion couples are having when thinking about starting a family.   

However if couples analysed the total cost of raising children in Australia, this nation may well be childless because the final figure is significant. So what’s the number? The cost of raising one child to the point of parental independence (age 24 in Australia) is $597,949 - more than the cost of the just-released Ferrari at $590,000

And the cost of raising the average family size (2.7 children) to the age of leaving home for the final time (they're not called the boomerang kids for nothing!) now exceeds 1 million dollars ($1,151,304 to be exact).   While of course parents have no regrets and would never wish to have swapped their house full of children for a garage full of Ferraris, the costs and comparisons do highlight the challenges for parents today, and the importance of any financial benefits and support they receive.

Here are the costs to raise the average family (2.7 kids) to independence (24) today per category. Note: the costs (eg housing) are not the total household costs but only the amount apportioned to the children.


Categories

One child:
June 2012

2.7 children: June 2012

Food

 $             105,774

 $             285,590

Housing and Utilities

 $             118,592

 $             178,456

Recreation and Entertainment

 $               77,245

 $             154,488

Health and other services

 $               92,881

 $             164,848

Clothing and Equipment

 $             64,508

 $             131,202

Transport

 $               100,002

 $             129,978

Education and Childcare

 $               38,947

 $             106,742

Totals:

 $             597,949

 $         1,151,304


The cost to raise one child to age 24 in June 2010 is $557,013. 

The cost to raise 2.7 children to age 24 in June 2010 is $1,028,093. 

Updates from June 2010 to June 2012 based on ABS Cat 6401.0 - Consumer Price Index, Australia, Jun 2012 by category. Based on NATSEM figures.

The cost to raise 2.7 children to age 24 in June 2012 is $1,151,304.

Australia's Generation Ys are Big Spenders | Mark McCrindle on Today Tonight [MEDIA]

Wednesday, August 08, 2012

Australia's younger generations tend towards a lifestyle of spending rather than saving. Mark McCrindle was on Today Tonight this Monday with a social commentary on one of the possible causes of this trend.

Want more videos? Check out our YouTube Channel.

Demographic and Population Resources

Tuesday, March 20, 2012

At McCrindle Research, we have a wealth of resources we would love to share with the world! 

If you haven't already, check out our resources page! We have whitepapers, nifty downloadable A5's and excerpts from all of our published books. 

Best new is, they're all free to download.

So feel free to have a look around, download and share with your friends, employees and employers!


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