Morningstar Evolving Demographics: Opportunities and Challenges Bernard Salt 19 May 2016
Australians have always been driven by lifestyle Areas of high population growth (1.5% pa) and net loss between 1992 and 2015 Brisbane WINNERS LOSERS Perth Adelaide Melbourne Sydney Canberra Source: Based on Australian Bureau of Statistics data; KPMG Demographics Hobart
Australia must develop a culture of innovation United States Year USbn 1. Apple 1976 522 2. Google 1998 508 3. Microsoft 1975 412 4. Exxon Mobil 1870 321 5. Facebook 2004 311 6. Berkshire Hathaway 1955 310 7. Amazon.com 1994 298 8. Johnson & Johnson 1886 283 9. General Electric 1892 266 10. Wells Fargo 1852 250 Australia Year USbn 1. BHP Billiton 1885 110 2. Commonwealth Bank 1911 94 3. Westpac Banking 1817 72 4. National Australia Bank 1893 51 5. ANZ 1835 50 6. Telstra 1901 48 7. CSL 1916 35 8. Wesfarmers 1914 33 9. Woolworths 1924 22 10. Macquarie Group 1970 18 Source: Bloomberg Terminal Data as at 29 January 2016; KPMG Demographics
Australia has been extraordinarily welcoming of migrants Proportion of city population comprising international-born residents as measured by local censuses Source: relevant local census data; KPMG Demographics
New acronyms for our newest tribes PUMCINS Professional Urban Middle Class In Nice Suburbs KIPPERS NETTELs Not Enough Time To Enjoy Life Kids In Parents Pockets Eroding Retirement Savings LOMBARDS Lots Of Money But A Real Dickhead Source: KPMG Demographics
China s urban middle-class has expanded by 5 million per year since 2000 Population M City 2015 2000 1 Shanghai * 24 14 2 Beijing * 20 10 3 Chongqing * 13 8 4 Guangzhou * 12 7 5 Tianjin 11 7 6 Shenzhen * 11 7 7 Wuhan * 8 7 8 Chengdu * 8 4 9 Dongguan 7 4 10 Nanjing * 7 4 Top 20 cities in China at 2015 and 2000 Population M City 2015 2000 11 Hong Kong * 7 7 12 Foshan 7 4 13 Hangzhou 6 3 14 Shenyang 6 5 15 Xi'an * 6 4 16 Suzhou 5 2 17 Haerbin 5 4 18 Qingdao 5 3 19 Dalian 4 3 20 Xiamen * 4 1 * Cities connected into Australia Source: Based on UN Population Division data; KPMG Demographics
Australian property is benefiting from the rise of the Dubai Effect Source: KPMG Demographics
The next decade is all about active retirement 2004-2014: 3.6 million (19.9m to 23.5m) 2014-2024: 4.2 million (23.5m to 27.7m) Kids & teenagers Young adults Mature adults Active retirees FOR SALE 500,000 450,000 400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000 - Suburbia & school Household & mortgage Superannuation Social activity & wellness 0-4 5-9 10-14 15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65-69 70-74 75-79 80-84 85+ Net change in the Australian population by 5-year age group over 10 years to 2014 and 10 years to 2024 Source: Based on Australian Bureau of Statistics data; KPMG Demographics
Melbourne and Sydney boom while other cities subside 2014/15 2013/14 2012/13 2011/12 2010/11-2004/05 Sydney 83,309 82,632 78,911 67,169 53,433-32,800 Melbourne 91,593 94,335 91,110 83,092 63,509-55,421 Brisbane 35,013 37,402 42,124 45,880 39,088-42,714 Perth 31,132 38,056 65,147 71,291 52,435-24,745 Adelaide 12,142 13,431 12,606 14,509 10,994-8,804 Top Five 253,189 265,856 289,898 281,941 219,459-164,484 Balance 63,894 77,485 99,201 106,289 88,815-79,636 Australia 317,083 343,341 389,099 388,230 308,274-244,120 Annual population growth in Australia s largest cities over a decade Source: Based on Australian Bureau of Statistics data; KPMG Demographics
A generation of prosperity has created a culture of aspiration 1960s 1970s 1980s 1990s 2000s 2010s 3 2.5 2 1.5 1 0.5 0-0.5-1 -1.5 Menzies Whitlam Fraser Hawke Dec-1959 Jul-1960 Feb-1961 Sep-1961 Apr-1962 Nov-1962 Jun-1963 Jan-1964 Aug-1964 Mar-1965 Oct-1965 May-1966 Dec-1966 Jul-1967 Feb-1968 Sep-1968 Apr-1969 Nov-1969 Jun-1970 Jan-1971 Aug-1971 Mar-1972 Oct-1972 May-1973 Dec-1973 Jul-1974 Feb-1975 Sep-1975 Apr-1976 Nov-1976 Jun-1977 Jan-1978 Aug-1978 Mar-1979 Oct-1979 May-1980 Dec-1980 Jul-1981 Feb-1982 Sep-1982 Apr-1983 Nov-1983 Jun-1984 Jan-1985 Aug-1985 Mar-1986 Oct-1986 May-1987 Dec-1987 Jul-1988 Feb-1989 Sep-1989 Apr-1990 Nov-1990 Jun-1991 Jan-1992 Aug-1992 Mar-1993 Oct-1993 May-1994 Dec-1994 Jul-1995 Feb-1996 Sep-1996 Apr-1997 Nov-1997 Jun-1998 Jan-1999 Aug-1999 Mar-2000 Oct-2000 May-2001 Dec-2001 Jul-2002 Feb-2003 Sep-2003 Apr-2004 Nov-2004 Jun-2005 Jan-2006 Aug-2006 Mar-2007 Oct-2007 May-2008 Dec-2008 Jul-2009 Feb-2010 Sep-2010 Apr-2011 Nov-2011 Jun-2012 Jan-2013 Aug-2013 Mar-2014 Oct-2014 May-2015 Dec-2015 Per cent change in Australian GDP by quarter from December 1959 to December 2015 GST GFC Source: Based on Australian Bureau of Statistics data; KPMG Demographics
The way we live has changed 1950s Today
Australians are dividing the lifecycle into thirds 2016 Child Adolescence Adult Lifestyle Retired Old 82 Child Teen Adult Old 1976 71 1936 Child Adult Old 63 0 10 20 30 40 50 60 70 80 90 Change in life expectancy over 80 years in Australia Source: Based on Australian Bureau of Statistics data; KPMG Demographics
From Boomers to Xers and Ys and finally to Zeds BABY BOOMERS X GENERATION Y GENERATION Z GENERATION Born 1946 1964 Born 1965 1982 Born 1983 2000 Born 2001 2019 Today 50 68 Today 32 49 Today 14 31 Today 0 13 Hierarchical Forgotten generation Special bubble-wrap Parents results-oriented Indulged their kids Wrong place wrong time Chaotic connection Youth in straitened times Depression era parents No workplace guilt Entrepreneurials Highly educated, global Sandwich generation Angsty about Ys Disappointed generation? Pragmatists fixers Superannuation Financial Planning Mortgages School fees Source: KPMG Demographics
Australia is in the middle of a structural shift towards knowledge work 800 700 600 500 400 300 200 100 0-100 Healthcare Professionals Construction Retail 16 years February 2016 up 3.1m (8.8m 11.9m) Feb 2000 Feb 2016 (000) Jobs grown: 3,462 Jobs contracted: 359 Net jobs added: 3,103-200 Healthcare & Social Assist. Professional/ Scientific/Tech. Construction Retail Trade Education & Training Public Admin & Safety Accom & Food Transport/Postal/ Warehouse Mining Admin & Support Financial & Insurance Arts & Recreation Rental/hiring & Real Estate Electricity/Gas/ Water & Waste Other Services Info Media & Telecoms Wholesale Trade Agriculture/Forestry & Fishing Manufacturing Source: Based on Australian Bureau of Statistics data; Bernard Salt
Points to consider 1 2 3 Australia is a rich, prosperous, young nation with abundant resources we will remain a prosperous people for decades to come Australians are living longer, are more cosmopolitan, are more lifestyle focussed and are more aspirational than ever before delivers opportunities to build business engagement The Australian economy is transitioning towards the knowledge and innovation industries we must embrace entrepreneurialism and create our own jobs of the future Source: Icons made by Freepik from www.flaticon.com; KPMG Demographics
Introducing Australia s bachelor hot spot Roxby Downs 1.88:1 Mullumbimby 1.63:1 Hotspot suburbs for single men and women aged 25-34 at the 2011 Census Barrier Highway Highway of Love Source: Based on Australian Bureau of Statistics data; KPMG Demographics
Connect www.bernardsalt.com.au +61 3 9288 5047 bsalt@kpmg.com.au @bernardsalt Bernard Salt Demographer linkedin.com/in/bernardsalt @bernardsalt
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