The Australian Population policy that seeks to increase population can be dated to post World War II when a 2 percent population growth was adopted (Australian Population Policy, n.d.). This increased the Australian population capacity from the then 7.5 million people to an estimated over 22 million in 2010. Australia registered the highest population in the world at over 2 percent per year between 2008 and 2009. This can be ascribed to a high fertility rate of over 1.97 and a reduction in death rates. The Australian population is among the fast-growing ones in the OECD (P. McDonald, n.d.). Australian policy covers fertility rates, death rates, and also immigration where there have been reduced mortality rates due to spending on healthcare, government support to families to ensure they sire the number of children that they would like, and also immigration policies that project an increase in economic growth. This paper examines if the Australian population policies are good for the country from environmental, economic, and living standards perspectives.
From an environmental perspective, whilst a growing population aids in easing the pressure caused by the ageing population, it also has its consequences. Various researches have proved that an increase in the population places much pressure on the earth’s resources such as land, water, forests, fisheries, atmosphere, and non-renewable energy sources (Mischa, 2015). Therefore, a higher population will increase consumption rates in Australian environmental capacity which will eventually lead to resource scarcity. To meet this high need to maintain the population, Australia will thus need to clear forests in order to increase its agricultural output that meets the needs of the high rising population. To meet the high population, the natural environment will be converted to other human activities, for example, logging to meet the need for high housing construction needs. When the natural environments are degraded this will also have a major impact on the tourism sector since the tourists that come to see the beautiful Australian environment will no longer be able to visit the country.
Australian population policy targets a population of between 26 and 30 million people by 2050. Immigration has always been involved in a major way in shaping the Australian population as well as the economy. It is estimated that 25 percent of the Australian population was born outside the country. Over the past decade, Australia has enjoyed outstanding growth in income and experienced a rise in living standards. This has been attributed to a population which has provided the economy with a vibrant and young workforce. Moving forward, however, it is projected that the population ageing would slow the economic growth of the country in terms of Gross Domestic Product per person. In addition, a stunted economic growth would increase ageing-related expenditures which increase budget spending in response to the demand for government services and healthcare services. A slow population growth, therefore, reduces the workforce participation since there will be an ageing labour force and it will also increase the dependency level which will eventually reduce the economic output (Australia et al., 2010).
On the other hand, an increase in population growth has various important outcomes. A higher population raises the labour supply in the market. A high population means diversified and probably skilled labour which increases the productivity level of the economy. It also adds value to the labour participation in the addition of skill effect. Higher productivity levels help maintain the economy and therefore this will lead to increased wages for workers which means that the living conditions for the workers will have improved emphatically (Australia et al., 2006). A higher population could aid in balancing the economies of scale and competition since a high Australian population would offer a platform upon which Australian companies could break into the export markets.
Further, a high population has other benefits to production which come about as externalities which can be categorized as economies of scale arising from thick markets. This has the potential to raise knowledge spillovers amongst the Australian corporations, resulting in economies of the localized industry due to shared production input, and exploitation of larger specialization amongst corporations. By enabling firms to match work skills to requirements, it will lead to a reduction in the transaction cost, and make Australia adopt new technologies through an increase in its capability to take on research and progress (Whitmore, 2016). In addition, a larger population means that there is a big domestic market for businesses which improves productivity by increasing local competition of businesses which further reduces monopolistic behaviours of businesses.
Contrary to these, Australia’s population policies are not good since a higher human population leads to serious environmental degradation practices which include water pollution as increased agricultural activities will lead to land degradation and water pollution. There will be coastline and marine environment disturbances when the population grows as the natural habitat of species living in such environments will be changed to suit the needs of the human population such as being converted to fish farms. A higher population points to a higher energy demand which increases reliance on fossil fuels. Fossil fuels lead to a release of greenhouse gases and air pollution which causes global warming. A high consumption rate also generates a large amount of waste (de Sherbinin et al., 2007).
Higher population growth in Australia will diminish the availability of capital per head thus reducing the productivity of the labour force which will, in turn, reduce the income of the labour force, thus upsetting the capital formation. A high population in the Australian market may adversely affect the labour market in the long run since it could lead to an increase in the supply of labour thus there will be a higher rate of unemployment in the population (Peterson, 2017). An increase in unemployment not only leads to a high dependency level but also leads to other social ills such as crimes. Growth in the population may put pressure on people to increase urbanization which leads to congestion in cities, and this has been evident in most Australian cities such as Melbourne and Sydney as well as Victoria which has the highest population growth (P. P. McDonald, 2018).
A higher population will alter government services such as education services, infrastructure, and healthcare. It alters the level and mix of different government transfer payments such as social security and also alters the tax revenue that the governments collect. This greatly affects efficiency since for instance; it would lead to an increase in skilled labour. This increases the income tax revenue since a bigger labour force per person in the population earns higher wages (Australia et al., 2006). Thus, an increase in population not only leads to a diversified workforce but also an increase in the domestic market which has important value to the economy.
Despite the fact that a high rate of the population could have negative impacts on the environment and the living standards of people, the Australian government’s policy which encourages population growth is justified by the many economic benefits of having a bigger population. It is, therefore, a good policy for Australia given its economic importance in terms of productivity of the labour market and the potential it has for an extensive improvement of living conditions of the Australian people. However, to ensure that the balance between the demands and the benefits of the population growth is met, the government should be clear on its sustainability measures.