Population and Labour Force

South Australia is facing a population crisis borne of lower birth rates, a significantly ageing population, a history of lower migration intakes and a sustained pattern of emigration.

The State has the title of the oldest population State in Australia and with some 16,000 fewer people in the 0-14 age groupings compared to the 15-29 age group and a significant population bulge in the 45+ age groupings, the next ten years will see a marked decline in the State's working population as large numbers of mature workers disengage from work either at or before retirement age. By 2012, South Australia will have more aged 65+ than there are in the under 15 age group, some 7 years earlier than in Australia as a whole.

The impact of ageing and fewer younger people is already evident across the State and particularly in regional areas where the loss of younger people continues to work against the continuation of many rural communities.  Although regional communities tend to have higher birth rates, they generally lose a much higher percentage of young people to major urban centres. This process of urbanisation is accelerating as career aspirations generally change from manually based occupations to service occupations.

The exact numbers who will leave the workforce through retirement in regional areas and not re-engage in full-time work is difficult to determine with any accuracy as there are a complex set of variables that are at play, including physical capacity, financial capacity and lifestyle choices.

Similarly, the emergence of a highly competitive labour market where strong growth in the mineral resource sector will continue to pull labour from industries such as the primary industries sector are only recently becoming understood.

The pace of labour loss from primary industry sectors is clearly accelerating with DEWR quarterly labour force data recording a staggering 20.5% labour force loss from primary industries in the Northern and Western Statistical Division in the 12 months ended May 2006. A 9.1% labour force loss was recorded in the South Eastern Division of the State. Both these regions are central to much of the State's primary industry output and comprise approximately 95% of the State's land. The actual numbers lost to the Primary Industries sectors across the State during this 12 month period was 3998 persons leaving a recorded labour force (ABS) of 37,318.

Even with programs to attract young people into primary industry careers and efforts to provide employment options for unemployed and under-employed persons, the reality, based on current trends, is that the quantum of the labour force loss will far outstrip any capacity to attract from within the State and National labour market.

The employment losses that are being recorded are impacting on whole communities and will have a multiplier effect on regional populations as services are also progressively withdrawn.

In economic terms, the value of the State's primary industries is enormous even though a relatively small proportion of the State's workforce is engaged in primary production activities. 

Further impacts of ageing in particular will also impact upon GDP. The per capita GDP fall associated with ageing alone will see a sharp decline from 2008 through to 2024 (Productivity Commission Report). In South Australia this phenomenon will hit the State earlier and be more protracted. However, the more serious issue is the level of disengagement and the timing of that disengagement. In South Australia the percentage of baby boomers is higher than the national figure and with a marked lower participation rate for 55-59 year olds, the impact will be considerably deeper.

The actions required to address general and industry specific labour shortfalls encompass an array of measures but in the case of primary industries and their pivotal position in the life and welfare of regional communities there are limited options. Issues concerning migration have a more important role and especially in relation to the provision of a wider skills profile to maintain functionality within smaller communities.