How COVID-19 will impact the future population of Major Regional Cities

In this series, our local government forecasting team look at the impact of COVID-19 on different ‘types’ of places in Australia, starting today with ‘Major regional cities’. This analysis accompanies the detailed impact assessment page that has been added to the population forecasts for each of the Major Regional Cities listed in the table below.

COVID-19 is causing major social and economic disruption which is evolving rapidly around the world. In Australia, the impacts on the size and distribution of future population growth are significant. Our forecasters are thinking about these impacts of COVID-19 on local government population forecasts and are rolling out a COVID-19 impact assessment for our local government clients.

In our last blog, we introduced the framework we’re using to produce these impact assessments and answered questions like ‘Do the current forecasts account for the impacts of COVID-19?’, ‘What will the impacts of COVID-19 be?’ and ‘Will these impacts be felt the same everywhere?’.

While we know that the impact of the pandemic will be felt differently in different places, there are also similarities between how some places will be impacted. In this first blog in the series, we’re looking at the impact of COVID-19 on Major Regional Cities.

What is a major regional city?

For the purpose of the COVID-19 impact assessment, we have defined a major regional city as any non-capital city with over 50,000 residents. Why 50,000? There is no right or wrong answer, but we feel that generally, these are the number of residents needed to generate the range of higher-order services, facilities and employment to extend to, and support communities far beyond the city itself.

Other characteristics we identified as common to major regional cities include a Central Business District (CBD), rail, ports, airports, as well as suburbs which are often in different life-cycle stages.

The table below lists all the major regional cities in Australia by population. What I find interesting is that Queensland contains the largest number of major regional cities with thirteen (13), followed by New South Wales (10), Victoria (9) and Tasmania (1). In fact, over 2.27 million Queensland residents live in a major regional city. That’s over 45% of all Queensland residents!

The Local Government Areas highlighted orange below subscribe to our population forecasts. Click the link in the table to view the forecast and COVID-19 impact assessment for that city.

Major regional cities, Australia

^{*Albury (C) and Wodonga (C) effectively function as one major regional city with a combined estimated resident population of 96,430 in 2019}

How will COVID-19 likely impact major regional cities’ future populations?

We recently had the opportunity to present the COVID-19 Impact assessment to Wollongong City Council. Our discussion confirmed many of the challenges and opportunities COVID-19 has created for our major regional cities population forecasts.

What are the current COVID-19 challenges to population forecasting for this type of place?

One of the most significant challenges the pandemic presents is quantifying the impact it will have on net migration. Net migration is dynamic, it’s a significant driver of population change and we use it to describe who will move in or leave an area. At a local area level, net-migration includes:

• Net overseas migration (NOM) – people moving to/from overseas including permanent migration as well as and temporary migration, students, backpackers, 457 visa holders etc)
• Net interstate migration – people moving to/from another State or Territory
• Net intrastate migration – people moving to/from another area from within the same State or Territory

Current baseline forecasts for Wollongong City Council assume that over the next five years, net-migration will contribute over 50% towards total forecast growth. This alone makes it very important to get a handle on….

The table below is an extract from our recently released COVID-19 impact assessment page. It summarises the contribution each migration component makes towards total net-migration, between 2011 and 2016.

Specifically, it draws on migration information from our community profiles to compare Wollongong City Council to Greater Sydney. We chose Greater Sydney as a benchmark, as it’s connected to Wollongong in a number of ways including proximity, transport, migration (day-time and permanent) as well as numerous economic and cultural linkages.

This historical information gives us context for assessing the potential impacts on forecast growth for each of the migration components. As forecasters, it gives us a clearer answer to the question we keep asking ourselves… “ who will move in or leave the area, and why?”

COVID-19 Impact assessment, Migration indicators, Wollongong City Council

Overseas migration > some negative impact

Nationally, this impact will be severe. We forecast net-overseas migration will decline by more than 700,000 people by 2031.

Wollongong has both a lower share of residents born overseas, as well as a lower share of residents who lived overseas five years before 2016, compared to Sydney. This five-year time frame is handy as it captures not only direct overseas migration but also those overseas-born residents, who might have moved one or more times over the past five years before settling in Wollongong. Think here of a resident who may have initially settled in Sydney (maybe rented), but moved to Wollongong when they were more established and wanted to buy a house.

This information tells us that the impacts from the national shock (closure) to net-overseas migration will be felt less overall and with a lagging effect in major regional cities such as Wollongong, compared to our capital cities.

Interstate migration > some positive impact

Typically Wollongong loses residents interstate (mostly young adults and slightly older families to South-East Queensland and to Melbourne), which you can see as a -19.3% interstate migration contribution in the table. Due to current border closures and general uncertainty, it is highly likely Wollongong will retain comparatively more residents over the next few years, than previously.

Intrastate migration > some positive impact

Wollongong attracts large numbers of new residents from other areas within New South Wales (over 50% of total net-migration), particularly from Sydney. During and after COVID-19, levels of net in-migration could increase even more to Wollongong and other major regional cities in particular with strong “pull-factors” and in proximity to capital cities. More on this later…

International students > Negative impact

COVID-19 is having a severe impact on the numbers of current and future international tertiary students in Australia. This impact will be most felt in major regional cities with large universities, like Wollongong, which attracts large numbers of international students (The University of Wollongong is one of the largest regional universities in Australia with over 15,000 international students in 2018).

Other COVID-19 challenges which we have identified for Wollongong as a Major Regional City

Births

Wollongong’s baseline population forecasts assume over 13,000 births over the next 4 years. Due to COVID-19 these numbers are likely to be fewer over this period, as fertility typically declines in times of economic and social uncertainty.

Deaths

Deaths caused by COVID-19 are currently at very low levels, however, the number of deaths could increase if outbreaks were seen in areas with relatively large numbers of vulnerable elderly residents (such as seen in aged care facilities in both Melbourne and Sydney). Wollongong has a slightly higher share of residents aged over 70 years (and therefore mortality exposure) compared to Sydney.

Resident vulnerability

Wollongong has a relatively higher share of low-income households and rental stress. This means that COVID-19 will increase the likelihood of housing relocation among households who are already vulnerable, which could affect household formation in several ways including younger residents moving back home with their parents, elderly residents moving in with their children (as dependants) and formation of group households and other larger households to share housing costs.

Our colleague Nenad has published a series of interactive tools to help you identify indicators of vulnerability in your community.

Does COVID-19 offer any opportunities… at all?

In the current setting of uncertainty and disruption, thinking about any opportunities which the pandemic is creating is challenging. But when we looked at the characteristics of Wollongong, and other major regional cities, we found a few. We found a number of ‘pull-factors’ which could potentially attract more new residents to Wollongong from nearby areas, including Sydney.

Historically, we know that Wollongong attracts large numbers of residents from other areas in NSW, particularly from Sydney (see map below). These new residents are typically attracted to

A range of jobs, including higher-order service jobs

Wollongong and other major regional cities with a diverse range of jobs generally retain a greater share of residents (as well as attracting new residents) compared to other areas.

Local amenity

A large number and diversity of lifestyle opportunities (including access to natural environment and open space) draws new residents, particularly from bigger capital cities.

Affordable and quality housing

Wollongong attracts new residents from Sydney, which comparatively has more expensive housing.

Quality health, education, transport, sporting and cultural infrastructure

Wollongong Hospital, University of Wollongong, Wollongong Art Gallery and Illawarra Performing Arts Centre and Illawarra Stadium.

COVID-19 has meant that we are generally more accepting of (some even embracing) more flexible working conditions, with many organisations talking about continuing more flexibility about working-from-home.

This means that major regional cities, like Wollongong (which have both proximity and strong transport links with capital cities), could potentially attract even larger numbers of new residents from capital cities, who are more readily able to both live regionally and work in metropolitan capitals by commuting less and working-from-home more.

Migration flows, Wollongong City Council

What’s the impact of COVID-19 on other parts of Australia?

We are answering this question by breaking Australia’s Local Government Areas (LGAs) into place-based typologies, as there are common themes in how these groups of places will be impacted.

The next place typology we will be looking at is peri-urban areas. Subscribe to our blog for updates as we roll out this analysis, or to our product updates to be notified when new data and features are added to our online tools.