A 20-year journey on the generational cycle

TWO decades' worth of demographic issues surveyed.

LAST week I explained how I got my start in demographic commentary 20 years ago this month.

That got me thinking about the change in demographic issues over the years and indeed how they seem to move in cycles of about a decade. Here's my assessment of the demographic issues cycle since 1989.

Early 1990s: In the first half of the 1990s business and the media had a largely one-dimensional interest in demographic issues focused on the scale and pace of population growth in Queensland. The Brisbane-Gold Coast corridor was the fastest growing area in Australia.

That prompted queries down south as to why. To some extent puzzlement over the Gold Coast's unrelenting growth is still present. I put that down to southern chauvinism: the view that Sydney and Melbourne hold a monopoly on cultural sophistication, so why would anyone move to the Gold Coast?

This was also the era in which Hervey Bay emerged. It was the fastest growing urban centre nationally in 1993 (up 8 per cent in 12 months), largely because it offers middle Australia access to an affordable seachange.

Late 1990s: By the late 1990s a new demographic shift started to emerge as young people moved back into the city centre.

The movement first surfaced in south Sydney around 1992 but quickly spread to Melbourne's Southbank.

From there it leapfrogged up to Brisbane's Fortitude Valley, then to Adelaide's East End and finally to East and West Perth around the turn of the century.

Even Newcastle got in on the act with its Honeysuckle inner-city redevelopment.

The driver of the downtown shift was a different set of values being of a new generation of Xers who rejected the suburban narrative of the baby boomers.

Xers delayed commitment and pursued tertiary education, which demanded access to the institutions of the city centre.

Soon enough older baby boomers began to embrace the inner city lifestyle as part of an empty-nest syndrome.

Even television series of the era reinforced the downtown paradigm shift. Seinfeld and Friends were both 1990s hits in which no-one was married, there were no kids and all characters lived carefree city-centric lifestyles. Who wouldn't want to live like that at that time?

Interestingly enough, it was in the late 1990s that first mention was made of a new generation following the Xers. They were known as Generation Dotcom. Recall that this was during the ascendancy of the dotcom bubble.

When the tech-wreck came in 2001 the term Generation Dotcom evaporated and in its wake came the Generation Y that we have come to know and love.

Early 2000s: Things started to change early this decade when two powerful demographic forces came out of nowhere. The first was seachange, partly the result of ageing baby boomers looking for a beach house, but partly also a byproduct of rising prosperity associated with the then nascent boom.

The second was the rise of Generation Y, who were quickly associated with issues based on work (difficult to hold) and the home (difficult to get rid of).

The seachange movement morphed into treechange. Both have taken a battering with the downturn since the first asset to be sold is the holiday house.

Late 2000s: In the latter years of the boom and even into the downturn the dominant (or at least popular) demographic issue was the skills shortage. To some extent this was an extension of issues to do with "managing Generation Y". But it was always more than that.

The boom switched the demand for labour from manufacturing in our cities to the delivery of resources in rural and remote communities, and especially in places such as the Bowen Basin and the Pilbara.

Other issues at the moment include Australia's rising population growth rate and how this is being managed, as well as the changing ethnic composition of our immigration intake.

There has been a marked shift towards migrants from India and China and away from traditional Mediterranean sources.

Early 2010s: This of course raises the issue of what is likely to drive the business agenda early next decade from a demographic perspective. In some ways the next five years will be an amalgam of unresolved issues present now.

Delivering services, infrastructure and housing to a nation careering along at perhaps double the growth rate of the late 1990s will be an issue for the community and an opportunity for business. So will managing community concerns about the environment as a consequence of faster population growth.

Another demographic trend that will become more prevalent next decade is the rising middle-class prosperity of this decade's young Chinese and Indian migrants. This could translate, for example, into demand for trophy housing so successful migrants can showcase their triumphs.

And finally, as the nation recovers from the downturn there will be skills shortages.

These will be exacerbated as baby boomers retire from the workforce through the decade. Some boomers will stay longer in the workplace but most likely in a reduced capacity.

Business right now needs to think through the skills and human capital issues required to sustain the recovery.

Bernard Salt is a KPMG Partner

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