South Australia seeks formula to reverse exodus
One conversation instils fear and despair in the hearts of South Australian parents.
Of all the conversations parents never want to have with their child — drug or alcohol problems, unwanted pregnancies, relationship dramas — one particular chat has instilled fear and despair in the hearts of South Australian mums and dads for more than a generation.
It’s this: “Mum, Dad, I’ve got a job … in Sydney.”
Or Melbourne. Or Brisbane. Or overseas, or anywhere but Adelaide, where the brain drain is the dinner party-stopping topic of conversation for the South Australian middle class.
“By my estimate we would have lost 120,000 of our best and brightest over the past 20 years,” says property developer Michael Hickinbotham, whose Hickinbotham Group has remained committed to South Australia since the company was started by his father, Alan, in 1954.
“Our state has been hollowed out to the tune of 6000 a year for two decades by the loss of our best and brightest. Imagine what SA would be like if we could bring those people back here.”
Imagining such an outcome is exactly what SA Premier Steven Marshall is trying to do. As the eastern states premiers are shutting the gates amid political pressures over congestion, infrastructure shortfalls and unaffordable housing, Marshall sat down with The Weekend Australian to talk through his ambitious plan to drive up the state’s population, while walking a cautious balance to ensure that SA’s cherished lifestyle is not compromised by too sudden an influx of humanity.
State Bank collapse
The origins of SA’s population decline can be traced back to an emblematic and devastating moment in the state’s recent political history — the 1991 State Bank collapse that blew a $3.15bn hole in the state’s economy.
The timing was exquisitely bad, coming ahead of the collapse of traditional heavy manufacturing jobs at Mitsubishi and then Holden, closures of small allied businesses, and psychologically debilitating issues such as the loss of the Australian Formula One Grand Prix to Melbourne.
These ill winds transpired to create a sense of despondence, where thousands of young people, most of them university-qualified but also aspirational tradies looking for jobs in mining and engineering, simply upped and left.
In 2000, SA came close to recording negative population growth; by 2006 the Adelaide CBD’s population was languishing at less than 17,500, and has only now clawed its way up to 25,000.
Moving back
In the past few years there have been signs the state is starting to buck the trend. It is a moot point whether this reflects a sense of optimism following last year’s change of government after 16 years of Labor rule, or whether SA is now benefiting from the fact that eastern states residents simply can’t hack their punishingly expensive lifestyles any more.
Either way, there are signs that former SA residents are moving back, and eastern states residents are moving here too, with the number of people leaving annually dropping from about 7000 a few years back to 4200 today.
Marshall wants to get that to zero, and then start taking more people than SA loses.
“When we came to government we were growing our population by around 10,000 people per year, which was less than half the national growth rate,” Marshall tells The Weekend Australian.
“That meant we lost a seat in the most recent federal election. The consequence of that is really diminishing our influence at the federal level, going from 11 seats back to 10 seats, but more than that we just haven’t been keeping up with the peloton. The fast growth states are getting away from us.”
Marshall’s plan
Marshall has devised a four-pronged approach to stem the tide. He wants to stop young people leaving SA and to attract back those who have; he wants to win more people from the east; he has secured a deal for overseas students to remain in and work in Adelaide after they graduate; and he has convinced Canberra to give SA a greater share of the annual skilled migrant intake by having the entire state deemed part of regional Australia through the Commonwealth’s Designated Area Migration Agreement.
“We want to grow the population but in a way that does not exacerbate the sort of problems that exist in the country’s larger population centres where they are struggling from rampant population growth.
“We want to get closer to the national population growth rate, which means we would need more than 20,000 people per year, and what we inherited from Labor was around 10,000 people per year,” Marshall says.
Political risks
Despite its vastly more relaxed lifestyle, South Australia’s politics is still vulnerable to claims of crowding and congestion that would seem laughable down the eastern seaboard.
Marshall has to tread carefully, with Greens, independents and anti-population candidates already firing up about small increases in travel times, or modest plans for three-storey or five-storey apartment blocks that spark outrage in suburbs still filled with quarter-acre blocks.
“If that means taking some political risks then that’s what I will do,” Marshall says.
“We need to make the case that we are moving the policy parameters for the greater good of SA. There is no doubt SA has not achieved its full potential over the last 15 to 20 years. We’ve got an opportunity now and I want to shift the dial now.
“The major risks interstate have been congestion, but that’s why we have got ahead of the game with massive congestion-busting initiatives courtesy of the good working relationship we now have with the federal government. We are getting ahead of the game.”
Detroit with a festival
The biggest challenge in terms of convincing eastern states people to move to SA is the lingering perception that Adelaide is Detroit with an arts festival, a barren old manufacturing hub that has fallen on hard times.
Marshall points to emerging advanced manufacturing industries and the sustained growth in defence, mining, agriculture (especially wine) and a new city vibrancy, with a growing CBD population and a buzz in the city that extends beyond the festival season known as Mad March.
He has not been helped to that end by the raw bottom-line figures in the most recent unemployment statistics, with SA jumping back up to 6.9 per cent. But he insists the figure has been fuelled by a surge in the number of people who have resolved to start looking for work in a rapidly growing jobs market.
“The job creation rate is more than double what was being achieved under Labor,” he says. “The quickest way to reduce the unemployment rate is to reduce the number of people looking for a job, but that doesn’t do the state any good. What we are seeing now is a whole bunch of people saying, ‘yep, I want to be part of this’.”
Population fears
Opposition Leader Peter Malinauskas doesn’t buy it, and cautions against any headlong rush towards massive population growth in the absence of sustained job opportunities. “Population growth can be an economic driver but it needs to be done in a well-thought-out way,” he says.
“Population growth that occurs without the requisite investment in services and infrastructure is bad policy, so when you have a government that’s cutting its investment in public transport, health and other key services, it does not speak well to a policy of population growth for its own sake.”
Marshall counters that his opponents across politics are reluctant to fully embrace his population push for political ends, and he wants the state to get behind a sales campaign on the basis of new jobs and a superior lifestyle.
“We are always in the 10 most liveable cities in the world but what we haven’t had of late is an economy to match that lifestyle,” he says.
“When I was born in 1968 Adelaide was the third largest city in the country,” he says. “We are now fifth.
“Also, there isn’t another state in the world where the population differential between the largest city and the second largest city is so stark. Adelaide has 1.3 million people and Mount Gambier, our second largest city, has about 25,000 people. That’s a massive differential and it just doesn’t exist anywhere else.
“Regional communities want to grow their population and that’s where skilled migrants can come in. These communities don’t want to see their populations declining because that means services being taken away.”
Lifestyle drawcard
Hickinbotham believes the ultimate draw to SA should be around lifestyle, provided the state can keep generating the new jobs to underpin it. He has just launched an acreage development in McLaren Flat, on the beautiful eastern edge of Kuitpo Forest in the Southern Vales, right next to world-renowned wineries such as Yangarra.
In eastern states terms, he is giving away 1100m blocks of land for less than $250,000, in a part of the state that’s 45 minutes from the Adelaide CBD and barely minutes from the majestic 12km-long beach between Sellicks and Port Willunga.
“You couldn’t get that anywhere else in Australia, not even close,” Hickinbotham tells The Weekend Australian.
“It’s what everyone in SA already knows, we don’t know how lucky we are to be alive.”
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