Sea changers and remote workers highlight the need for a 20-minute city

Between 2009-10 and 2019-20, Greater Melbourne’s population increased from 4.1 million to 5.2 million. Net international migration was the major driver of this population growth. International migrants were attracted to Greater Melbourne by a strong labour market. In the years leading up to 2019-20, net international migration to Greater Melbourne was between 75,000 and 80,000 people. With the international border closing in early 2020, net overseas migration slowed to 56,000 people in 2019-20.

National data shows that Australia had negative net international migration in the March quarter of 2021, with a net loss of 95,300 residents. Many of these residents would have left Greater Melbourne. Internal migration statistics have also seen a net loss of people from Greater Melbourne into the regions.

While Greater Melbourne’s population has declined, migration patterns are likely to return to normal once international borders are re-opened. The need for more workers which drove Greater Melbourne’s population growth prior to COVID-19 remains in place.

Many businesses are struggling to find workers, with job vacancies increasing to a level higher than before COVID-19. High job vacancies exist across many occupations. Professional services (e.g. accountants, computer programmers, engineers), trades (e.g. plumbers, electricians) and a range of occupations in health care such as nurses and aged care workers are experiencing shortages. The job vacancies in health and aged care aren’t just COVID-19 related but reflect demand from a steadily ageing population.

There are some job vacancies, such as in the hospitality sector, which would have previously been filled by international students or backpackers. Job vacancies for waiters and baristas have increased since the end of lockdowns as the hospitality sector prepares for a holiday rush. Even dishwasher positions are reportedly difficult to fill.

While there are opportunities for the unemployed and underemployed to fill some of these jobs, the existing labour force is struggling to provide enough workers to fill the current job vacancies.

With the economy returning to normal it is very likely that annual net international migration will revert to around 75,000 or 80,000 people. How quickly Greater Melbourne returns to this level will depend on how quickly business and consumers adjust to the new post COVID-19 normal.

The pause in population growth over the past two years has provided an opportunity to close the infrastructure provision gap, especially in the fast-growing greenfields. While Greater Melbourne’s greenfields have seen population growth slow, the impact of COVID-19 has seen a surge in population growth in many regional areas of Victoria. While some of this surge is the result of people making the sea-change or tree-change to take advantage of remote working, there are other factors at play. Regional centres which provide high local amenity, affordable housing and local employment opportunities have seen strong population growth.

Some regional areas may experience significant strategic land use and infrastructure planning challenges arising from increased population growth. Housing affordability for local residents and gentrification may also become an issue in some regional communities. There is a need for appropriate land use planning to ensure that housing, local services and infrastructure is sustainably provided to regional centres in order to maintain liveability.

This surge in regional centres does not significantly alter Greater Melbourne’s population growth trajectory. The regional centres simply do not have the scale to absorb the level of additional population growth needed to significantly change the growth rates for Greater Melbourne. Consider this hypothetical scenario: if Regional Victoria’s historical population growth rate doubled from around 1 per cent to 2 per cent, over the next 20 years, that extra growth would reduce Melbourne’s population from 7.4 million to 7.0 million. The increased regional growth doesn’t really change the population growth narrative for Greater Melbourne.

Over the medium to longer term there are still infrastructure challenges facing Greater Melbourne that will need to be addressed. This is not only in terms of large-scale transport infrastructure but also local infrastructure, such as schools, quality open space and local retail. This type of local infrastructure can help achieve the ‘20-minute city’ – giving residents the ability to meet most of their daily needs within 20-minutes of their home.

Designing and delivering this ‘20-minute city’ structure will enhance liveability for all Greater Melbourne’s new residents.

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