Three demographic trends to watch out for in aged care

Australia’s ageing population is a new challenge, one that will further test the aged care industry as resident numbers rise and workforce shortages potentially worsen. Aged care providers are also being warned to prepare for a major demographic shift which is already revealing its impact through several predicted trends. 

Bernard Salt AM, business advisor and futurist, queried whether Australia will have the capacity to deliver the quality of life expected by older people at the Aged Care Research & Industry Innovation Australia (ARIIA) Facing the Future: Aged Care 2030 and Beyond conference. 

He said Australia has the wealth to spend on aged care services and individuals often choose to prioritise their own savings for housing security, quality of life and retirement. But increased spending on aged care services will be essential as the Australian population ages and moves from retirement living to residential aged care. 

“The first Baby Boomer turns 85 in the early 2030s and you can see the 85-plus demographic is going to ratchet up every single year. So whatever budget you’re getting at the moment, whatever resources, skills and labour and infrastructure you require at the moment needs to be ratcheted up to reach a peak by about 2030-32,” Mr Salt said. 

“There is no misjudging the scale of what lies ahead and I’ve called it a freight train heading straight towards us unless we are fully and well prepared.”

Australia’s changing demographics

• The number of people aged 65 and over is projected to increase by 54% over the next 20 years, totalling 6.6 million in 2041
• Most growth will occur in the 85 and over age bracket, which is predicted to hit 1.28 million, an increase of 140%
• The ageing population is spearheaded by the Baby Boomer generation, with the first Baby Boomers to turn 85 in 2031

As the number of older Australians grows, there will be a dip in the workforce due to low birth rates in the early 2000s. Mr Salt called the diminution a glitch, but it will be impactful; as per the 2021-22 demographic snapshot there were fewer 10-19-year-olds than 50-59 year olds. 

“The skill shortage will be with us for quite some time. It’s not just a matter of beefing up overseas immigration. Getting more productivity and units of labour will be the main focus of administrators,” Mr Salt said.

“If your key market for workers comes from that glitch, you need to be very focused, very skilled, and very talented in being able to draw that market out.”

If international immigration is part of the solution, it will involve strengthening support for a critical part of the sector. Australia already has significant international influence; 30% of the current population was born in another country. 

As of 2021, the top five countries of birth other than Australia were England, India, China, New Zealand and the Philippines. In addition, Nepal is one of the fastest-growing countries of origin and aged care has benefited from an influx of South Asian workers.

Culturally and linguistically diverse (CALD) residents will influence aged care’s customer base and workforce, therefore, attracting and supporting staff and residents through an understanding of culture and language is going to be essential. 

Covering for informal carers

Approximately one-in-ten people are informal carers, with the highest proportion aged between 55-64. This reflects one of two things: it could be an older parent caring for a child with disability, or a person caring for their ageing parent. Baby Boomers are those currently at the peak age for caring for a parent, or they may have recently lost a parent they were caring for.

But with such a large number of informal carers now, there will be a considerable drop as families become smaller. It means there will be less support around the home for a large cohort of older people with the desire to age within their own four walls. 

“Later in this decade, the smaller Generation X will pass through that phase and the burden on the healthcare industry will be precisely a time when the number of people requiring healthcare services skyrockets. This is what lies ahead by 2030; extraordinary challenges,” Mr Salt explained. 

This indicates residential aged care providers need to further invest in home care services to ensure they’re engaging with a large consumer base. Without this investment, there could be a large disconnect with older people when they begin searching for a residential aged care home.

Alternatively, there could be a rise in assisted living communities where services can be delivered in a deinstitutionalised setting. It would allow people to be social and active within the community while engaging with a service provider for some home comforts and support services. Whatever approach you take, if you plan for future trends today, you will be better prepared for a safer and more approachable plan in the future.