Simon Kuestenmacher, Co-Founder of The Demographics Group, has addressed the National General Assembly in Canberra, sharing findings from Australian demographic data and providing key insights local governments can use to attract employees, care for communities and be prepared for the changing population.
Mr Kuestenmacher began his presentation by outlining demographic breakdowns across metropolitan, regional and rural areas around Australia. He explained that, across the country, in metropolitan councils there is a population bulge in the 30-49 age group. Regional councils have a smaller population in this category and a similar population in the 20-29 age group, but a larger 50+ population, and rural populations see a dip in the teen age population as children leave to attend boarding schools, but this population tends to return to and stay in the community in their 20s and beyond.
Looking at ABS forecasting, Mr Kuestenmacher told delegates that by 2034, Australia’s population will be bigger, more youthful but also older – expected the population to grow by nearly 4 million people, and the proportion of people in the 85+ age group to grow significantly.
Balancing this, migration will continue to be a feature of Australia’s public policy. Mr Kuestenmacher said that governments will talk about reducing migration, but claims that “that’s just talk”, and that migration overwhelmingly brings people in the 18-39 age group into Australia.
Mr Kuestenmacher said that the biggest single age that will be represented in 2034 is 43 and that this is the age in life at which people spend more money than they ever will.
Between school fees, mortgages and the expenses that come with running a large household with children, “at 43, every penny goes straight out the door. It’s impossible to save,” said Mr Kuestenmacher.
This is great news for businesses that sell to this group – but terrible news for the RBA with their focus on inflation. According to Mr Kuestenmacher, the next decade will continue to see significant levels of spending in the Australian economy.
Boomers will also contribute to this, as they’re in the stage of life where children are out of school and potentially out of home – so they have disposable income again and the ability to enjoy that.
According to Mr Kuestenmacher, if the RBA continues with its current strategy of rate rises to control inflation, the people who actually suffer will be the under 39 age group who typically rent and will see the impacts of rate rises passed on to them.
“There is a real gap here which can cause massive problems in communities,” said Mr Kuestenmacher.
Local government employment
The focus of the presentation then shifted to the challenges local governments face when hiring employees. Mr Kuestenmacher noted that hiring people was much easier 15 years ago, which many delegates agreed with. Mr Kuestenmacher asked in a post-COVID world, ‘why is it still hard to find good employees?’ The answer, he said, is demographics.
Many jobs in the local government sector are facing a retirement cliff. On average, across all professions, 15 per cent of the employees in any given role are approaching retirement age. This differs in local government roles though:
- Gardeners – 24 per cent of employees approaching retirement age
- Wastewater plant operator – 28 per cent of employees approaching retirement age
- Handyperson – 34 per cent of employees approaching retirement age
- Truck driver – 41 per cent of employees approaching retirement age
- Aged or disabled carer – 39 per cent of employees approaching retirement age
- Bus driver – 32 per cent of employees approaching retirement age
What do these statistics tell us? According to Mr Kuestenmacher, it potentially means that government will need to pay people in these professions more, as a simple supply and demand equation.
However, Mr Kuestenmacher advocated that councils need to educate people more about what they do offer employees.
“The private sector is a much bigger sector, so you need to make people aware of local government as an employer and you need to promote the work life balance benefits that you can offer. You cannot compete with the private sector on salaries, but you can compete on work life balance.”
Mr Kuestenmacher showed data that highlighted the average number of hours worked by employees across different sectors. In the private sector, it starts at 40 hours per week at 18 and constantly increases until retirement. But the local government sector has the lowest number of working hours per work from 18 until retirement across all sectors (private, federal, state and local governments).
Millenial women were particularly highlighted as an important cohort of potential employees in the local government sector.
Mr Kuestenmacher said that they’ve been out of the workforce for a few years for childrearing, they are looking for local, flexible employment that works with their new stage of life, and they have a wealth of skills and experience to offer the sector.
Key takeaways
Mr Kuestenmacher concluded his presentation with several key demographic takeaways for local government:
- Australia will keep growing, particularly our cities. Migration will see to this in metropolitan regions. For regional areas, to ensure population growth, they need to either serve as a lifestyle destination or be a region that provides jobs to drive growth, such as agricultural regions
- The skills shortage is here to stay. To attract staff, councils need to be loud and proud about the benefits they offer to employees, pulling all the levers they have access to – flexibility, affordable housing close to the workplace – to draw more people to the sector
- The wheel of time keeps turning. The population is aging, with a larger proportion than ever in the 85+ age group. Half of this population will require care; and loneliness will be rife. This is going to be a critical challenge for local governments, and councils should do any work they can do now to prepare for this
The National General Assembly continues in Canberra, with the Australian Council of Local Government meeting taking place on July 5.
Featured image: Simon Kuestenmacher, Co-Founder of The Demographics Group, addressing the NGA in Canberra. Image credit: Prime Creative Media.
