Aging of Population

In 2005, Japan had the highest median age of all countries in the world, while Australia's population was only moderately aged. Some 50 years ago, the demographic situation was quite different, with the median age of Australia's population being seven years older than Japan's. The ageing of the population is a major issue for Australian policymakers, particularly in regard to the long-term implications for reduced economic growth and the increasing demand for Age Pensions and health and aged care services. As the population ages, growth in the number of people of working age will slow, while the proportion of people of retirement age will increase. Sustained population ageing also leads to slowing or negative population growth. While some environmentalists and social scientists welcome declining population growth in developed countries, economists tend to agree that population decline brings gloomy economic prospects. In addition to the decrease in the labour supply, the demand side of the economy may be affected by shrinking markets for goods and services.