CANBERRA: Australia will see deaths outnumber births for the first time in the 2060s, the government forecast Monday, a demographic milestone that adds urgency to a national debate over immigration, an aging population and the strain both are putting on the economy.
The projection, included in the government's Intergenerational Report released by Treasurer Jim Chalmers, marks a turning point for a country that has for decades relied on immigration to offset a birth rate that has fallen well below the replacement level. With net overseas migration now slowing under government policy, Australia is on track to join advanced economies such as Japan, Germany and South Korea, where deaths already exceed births each year.
The Treasury report identified five long-term forces it says will reshape Australia's economy over the next 40 years: artificial intelligence, geopolitical fragmentation, the energy transition, an aging population and a shift toward a service-based economy.
Treasury now projects population growth will slow to an average of 0.9% a year over the next four decades, down from an average of 1.4% over the past 40 years, as fertility rates decline and net overseas migration falls before leveling off.
"For the first time, deaths are projected to outnumber births by the 2060s," Chalmers said in a speech Monday. He added that the number of Australians over 85 is expected to triple by 2066, adding significant pressure to the health system.
The report also warned that the aging population would drive up demand for care services, with regions that have older populations likely to face the sharpest labor shortages in health care and aged care — sectors that depend heavily on migrant workers. Treasury flagged the prospect of tax cuts in future budgets as the government continues offering cost-of-living relief amid elevated inflation, higher mortgage rates and expensive housing.
Immigration politics
The report lands as immigration has become one of the most volatile issues in Australian politics. The center-left Labor government tightened rules last week barring foreign students from bringing partners and children with them while they study, as Prime Minister Anthony Albanese tries to blunt a surge in support for the right-wing populist One Nation party, which has campaigned on sharply curbing immigration.
Albanese's approval rating has slipped to its lowest point since he took office in 2022. A Newspoll survey published in The Australian found One Nation had edged ahead of Labor in primary vote support, with the prime minister's popularity taking a hit. His net approval rating slumped to minus 24, a record low. The result marked the first time since Newspoll began in 1985 that the two major parties together attracted less than half of the primary vote.
A long-running trend
Australia's birth rate has been sliding for years. The country's fertility rate is expected to fall to an all-time low of 1.42 in 2025-26, continuing a decades-long decline driven by people delaying childbirth and having fewer children once they do. Australia has not met the replacement rate of 2.1 children per woman in nearly 50 years.
The pattern is far from unique to Australia. The International Monetary Fund has said global fertility rates have fallen from five children per woman in 1950 to roughly 2.24 in 2025, with projections showing the rate dropping below the replacement level of 2.1 by around 2050. Some of the steepest declines are in East Asia: South Korea's fertility rate has fallen to about 0.75, among the lowest in the world, while Japan's sits near 1.23.
Japan offers a preview of what slowing immigration combined with low fertility can mean for population size. Japan's population has been shrinking since 2009 because of low fertility rates combined with limited overseas migration. Germany and South Korea have also already crossed the threshold where annual deaths outnumber births, a shift demographers link to shrinking workforces, rising pension and health care costs, and growing reliance on migrant labor to fill jobs in aged care and other service industries, the same pressures Australia's Treasury flagged Monday as it looks toward the 2060s.
