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Baby boomtime

By Graeme Hugo - posted Wednesday, 3 September 2008

Many countries experienced a baby boom following World War II but in Australia the high fertility persisted longer than in most and its impact on age structure was exacerbated by the influx of unprecedented numbers of young immigrants’ families.

Moreover, the impact of the baby boomer generation born between 1946 and 1964 has been even more marked because the preceding generation born in the Depression and War years was so small due to low fertility and limited immigration. In addition to this, the halving of fertility rates between the baby boomer mothers and their daughters has ensured that later generations have not been able to outnumber baby boomers.

Accordingly, the baby boom generation is demographically more significant in Australia than elsewhere despite continued immigration of younger people. In 2006 more than a quarter of Australians were baby boomers (25.7 per cent) and, perhaps more significantly, 41.8 per cent of the workforce were baby boomers.


The sheer numbers of the baby boomers who will make the significant lifecycle stage transition from working age to retirement will have a profound impact on Australia’s economy and demography. A number of sequential reports from the Productivity Commission and the Treasury Intergenerational Reports have documented this.

On the one hand a doubling of the numbers of Australians aged 65 years or older in the next two decades will place increased fiscal pressure on demand for health and aged care services, especially in the 2020s as the older baby boomers enter their late 70s and the ages when there is a steep increase in risk of chronic disease and disability.

On the other hand their exit from the labour force will see a massive loss of skill and experience while the ratio of working age Australians to older, retired Australians will halve. Hence the potential for intergenerational transfers to meet their needs will be reduced.

Policy, of course, can not influence the first of these implications - the doubling of the aged population is inevitable. However, there are many things which can be done to reduce the intergenerational pressures.

First, there are a raft of ways in which baby boomers can reduce their ultimate reliance on intergenerational transfers by preparing for old age. Adequate preparation is clearly a sine que non for successful ageing. This is usually seen in terms of financial preparation and there have been warnings that many baby boomers, especially single women, have not sufficient financial resources for a long retirement. However, research is showing that the financial dimension, while crucial, is only part of the need for preparation. For example, for the first time we will have a significant proportion (around a quarter) of Australians entering retirement without a partner. Many will not have children living in the same city. Many have defined their lives by their work and will face decades of retirement with little or no idea of what they will do. Preparation for life beyond involvement in the formal paid workforce among baby boomers is a neglected area of policy concern.

A second major area of potential polity intervention to ameliorate intergenerational imbalances caused by ageing of the baby boomers relates to the workforce. Most obvious is the need to increase the retirement age of Australian workers which can improve both sides of the worker-retiree equation.


Skill and labour shortages should facilitate this process and the government has moved to encourage later retirement although there are important cultural barriers among employers relating to older workers. In addition Australia has some of the lowest workforce participation rates in the traditional working age groups of any OECD country so there are real opportunities to increase engagement with the workforce among groups currently excluded.

Policies which facilitate women developing full careers, whether or not they desire to have children, are becoming more common not only in government but also by progressive private sector employers. Australian young women should have exactly the same opportunities as young Australian men to have full family and full work lives on the basis of equity. However, it also now makes sound business sense in a labour shortage context.

In a similar vein we should be fighting against the disengagement from the workforce of socially excluded groups such as the Indigenous, poor, those from non-English speaking backgrounds and disabled communities. If we cannot achieve social inclusion of these groups in a labour shortage context, when can we? The workforce changes required are partly a matter of policy and change in regulations but it is also above all a cultural change which is needed - among workers, employers and governments.

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About the Author

Graeme Hugo is a University Professorial Research Fellow, Professor of Geography, and Director of The National Centre for Social Applications of Geographic Information Systems at The University of Adelaide.

Creative Commons LicenseThis work is licensed under a Creative Commons License.

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