Fertility and family policy in Australia

Research Paper No. 41 – February 2008

2. Fertility rates, demographic structure and population projections

2.1 Fertility trends

Figure 1 plots the TFR for Australia from 1921 onwards, while Figure 2 "amplifies" the changes that took place in the TFR between 2000 and 2005. At the beginning of the 20th century, the TFR was close to 4 babies per woman, having fallen by about one-third over the previous 30 years (Hugo, 2001). The rate fell to 2.1 babies per woman during the Great Depression in 1934 - a trend that apparently resulted more from deliberate birth control within marriage than from the postponement of marriage that occurred at the time (Ruzicka & Caldwell, 1982).

In the late 1940s and early 1950s, the economic outlook improved and fertility increased as births postponed during World War II took place. This rate was sustained by the trend towards earlier and near-universal marriages, as well as the influx of immigrants of childbearing age. By 1961, the fertility rate was at a record high - 3.5 babies per woman - but then fell for the first time to below 2.1 (the replacement level) in 1976. The rate then stabilised in the late 1970s and 1980s to between 1.8 and 1.9, and fell in small progressive steps in the 1990s. The rate was at its lowest level on record in 2001 (1.73), but had increased to 1.81 by 2006. Overall, however, the trend has been fairly steady since the late 1990s, fluctuating between 1.7 and 1.8.

Figure 1. Total fertility rate, Australia, 1921-2006

Figure 1. Total fertility rate, Australia, 1921-2006, described in text

Sources: Australian Bureau of Statistics [ABS] (various years)

Figure 2. Total fertility rate, Australia, 2000-2006

Figure 2. Total fertility rate, Australia, 2000-2006, described in text

Sources: ABS (various years)

Figure 3. Age-specific birth rates, Australia, 1921-2006

Figure 3. Age-specific birth rates, Australia, 1921-2006, described in text

Sources: ABS (various years)

Figure 3 shows the age-specific fertility rates for women since 1921. Between 1960 and the mid-1970s, the fertility rate fell in all age groups, particularly for those in their early and late twenties and those in their early thirties. From the late 1970s, the rates continued to fall for women under the age of 30 (especially those between 20-24 years), but increased for women aged 30 or over. From the 1980s, a slight increase was seen in women aged 40-44, however this rate remained very low. Since the early 1980s, the increase in fertility rates for women aged 30 years and over has been significant enough to offset the decrease in rates for younger women, though less so in the 1990s. More recently, the level of increase in the rates for older women has more than compensated for the level of decrease in the rates for younger women. Nevertheless, for all age groups except women aged 35-39 years, the fertility rate in 2006 was lower than in 1960.

The contemporary decline in the fertility rate overall stems from the fact that an increasing proportion of women either remain permanently childless or are having only one or two children. Between 1981 and 2006, the proportion of women aged 40-44 years who had two children increased from 29 to 38 per cent, while the proportion that had four or more children fell from 28 to 11 per cent. The proportion of women in this age range who had three children also declined (from 27 to 22 per cent), while the proportion having only one child fluctuated (between 8 and 13 per cent). There was also an increase in the proportion of women who remained childless (from 9 to 16 per cent).

Women who give birth over the age of 30 are increasingly likely to be first-time mothers - 41 per cent of all first births in 2003 were to women in this age range, compared with 28 per cent in 1993 (Australian Bureau of Statistics [ABS], 2001b; Laws & Sullivan, 2005). As a result, for many women the timeframe in which they can achieve their preferred number of children is progressively shortened. However, it is worth noting that women in their thirties are now less likely to have a child compared with women of this age during the baby boom period and before the Great Depression of the 1930s.

A limitation of the TFR and cross-sectional age-specific fertility rates is that they do not capture the long-term experience of a birth cohort. Examination of the long-term experience of birth cohorts shows a continued decline in the completed cohort fertility rate (CCFR) for all cohorts born since 1932. The most recent cohort for whom the CCFR is available is the 1960 birth cohort, which had a fertility rate of 2.15 children per woman (Kippen, 2004).

2.2 Australian fertility trends compared with those in other countries

Despite the alarm bells ringing within Australia, its current TFR is considerably higher than those in a number of other countries. Table 1 shows that fertility rates vary from 1.1 in South Korea to 2 or higher in New Zealand, USA and Iceland. Australia's fertility rate at 1.8 is at the higher end for OECD countries and is comparable with a number of European countries, particularly those in Scandinavia (other than Iceland). One measure of the demographic impact of fertility rates is provided by the projected change in the population between 2006 and 2050. The long-term fall in TFR to very low levels in some countries and difficulties experienced in attempting to reverse this trend have further fuelled the concerns felt in Australia (McDonald, 2001). As McDonald notes, such trends are inconsistent with the commonly held assumption that below replacement fertility would be a temporary phenomenon.

Table 1. Total fertility rate and projected population changes, selected countries, 2006-2050
  TFR Projected population
change (%)
  TFR Projected population
change (%)
South Korea 1.1 -13 China 1.6 10
Czech Republic 1.3 -34 Netherlands 1.7 3
Germany 1.3 -9 Australia 1.8 36
Hungary 1.3 -8 Denmark 1.8 1
Italy 1.3 -5 Finland 1.8 0
Japan 1.3 -21 Norway 1.8 25
Russia 1.3 -22 Sweden 1.8 16
Spain 1.3 -4 United Kingdom 1.8 14
Austria 1.4 8 France 1.9 5
Portugal 1.4 -12 Ireland 1.9 11
Switzerland 1.4 -4 New Zealand 2 18
Canada 1.5 29 USA 2 40
Belgium 1.6 4 Iceland 2.1 17
           
World 2.7 41      
More developed 1.6 4      
Less developed 2.9 50      
Less developed (excl. China) 3.4 63      

Notes: Projected populations based upon reasonable assumptions on the future course of fertility, mortality and migration. Projections are based upon official country projections, series issued by the UN or the US Census Bureau, or PRB projections.

Source: Population Reference Bureau (2006)

2.3 Population age structure

While the fertility rate in Australia has fallen to between 1.7 and 1.8 since 1994, life expectancy is at an all-time high, having increased by more than 20 years since 1901. Boys born at the beginning of the 20th century could expect to live for 55 years and girls for 59 years, while those born in 2001-03 can expect to live for 78 and 83 years respectively (ABS, 2001b, 2006b). Although the huge reduction in infant and child mortality is a key factor, the significant increase in life expectancy has also occurred in middle and older ages since the 1980s (Jackson, 2007). For example, men and women aged 50 years at the turn of the 20th century would look forward to another 21 and 24 years of life respectively, while today men and women of 50 years could expect 30 and 34 years of life ahead respectively.

The fall in fertility rates and the significant improvement in life expectancy have inevitably resulted in an "ageing" of the population, both in absolute and relative terms. The median age of the total population has increased by nearly 13.8 years, from 22.6 years in 1901 to 36.4 in 2004 (ABS, 2006a; Hugo, 2001).

The ageing of the population is captured in the changing shape of the so-called "age-sex pyramid", presented in Figure 4 for the years 1911, 1961 and 2004. In 1911, there were relatively many children and relatively few elderly people, and so the picture resembles a pyramid. In 1961, there was a swell in the population aged 15 years or under, representing most of the post-war "baby boomers" - defined by the ABS as residents born in Australia or overseas between 1946 and 1965 inclusive (ABS, 2005). By the end of 2004, this group was between 38 and 58 years old. Despite the relatively low fertility rates of baby boomers, the fact that they are a large cohort means that their children represent a large cohort - a factor which, along with increased life expectancy, has resulted in an age-sex profile that no longer resembles a pyramid.

Figures 4. Age and sex structure of Australia's population, observed (1911, 1961, 2004) and projected (2051)

Figure 4 part A, Observed age and sex structure of Australia's population, 1911, described in text.

Figure 4 part B, Observed age and sex structure of Australia's population, 1961, described in text.

Figure 4 part C, Observed age and sex structure of Australia's population, 2004, described in text.

Figure 4 part D, Projected age and sex structure of Australia's population, 2051, described in text.Notes: The baby boom population (born 1946-1965) is highlighted in grey. The 2051 age-sex structure is based on the ABS "medium" set of assumptions: TFR equal to 1.7 from 2018; net overseas migration equal to 110,000 from 2004-05; and life expectancy of 84.9 and 88.0 for men and women respectively from 2051-52.

Sources: ABS (1997, 2005)

Figure 4 also depicts the age-sex structure for 2051, as projected by the ABS on the basis of a set of specified assumptions regarding the TFR, life expectancy and net overseas migration (see note to Figure 4 for details). Under these assumptions, the age-sex structure in 2051 would bear no resemblance at all to a pyramid.

Figure 5 depicts the changing proportions of the population since 1901 of those under the age of 15 and over the age of 65 (here called "older people"), and future proportions in these same age groups to the year 2101, according to ABS projections. The representation of children under the age of 15 years in the total population is projected to fall from 20 per cent in 2004 to between 13-16 per cent by 2051. The growth in numbers of children aged 15 or under is projected to be much slower than the overall population growth.

In contrast, the size of the population aged 65 years and over, which in 2004 accounted for 13 per cent, is expected to continually grow at a faster pace than that of the total population. By 2051, the ABS has projected that older people will represent 26-28 per cent of the population. Similarly, the ABS projects that the increase in the number of people aged 85 and over will be faster than the increase of the overall population.

Figure 5. Proportion of population aged under 15 and aged 65 or over (1901-2004), and projected proportion (to 2100)

Figure 5. Proportion of population aged under 15 and aged 65 or over (1901-2004), and projected proportion (to 2100), described in textNotes: The projections are based on the ABS "medium" set of assumptions: TFR equal to 1.7 from 2018; net overseas migration equal to 110,000 from 2004-05; and life expectancy of 84.9 and 88.0 years for men and women respectively from 2051-52.

Sources: ABS (1997, 2005, 2006a)

The "working age" population is traditionally defined as being aged 15-64 years, although in practice many of those aged 15-19 years remain in education, and workforce participation rates fall considerably after 55. While the proportion of the population of working age is currently growing (61 per cent in 1901, 64 per cent in 1976, and 67 per cent in 2004), according to ABS projections it will begin shrinking in the next five years and return to around 60 per cent between 2031 and 2041 (Access Economics, 2001; ABS, 2005).