If you’re planning for future demand for a product, service or piece of infrastructure, a population forecast will be an important part of your evidence base.
- How many people will live nearby your new store?
- How many households will need a new water connection?
- How many school-aged students will live within a new school’s catchment?
It may seem obvious that the more detailed you can get with your analysis, the better decision you can make. Yet it’s surprising how often we hear examples of significant decisions being made with forecasts that make broad-brush assumptions about places and don’t reflect their important local nuances.
Let’s look at an example of how a more granular level of detail in your forecast may change the story you’re presenting, and might ultimately influence the decision you make.
A concentrated pocket of growth is averaged across an area
To show how a more detailed forecast can change the story, let’s look at real forecast data from our recently published population forecasts for South Australia.
In the animation below, you can see how the population of Adelaide North is forecast to change over the next 25 years. The data is the same in both maps, but on the left, it’s aggregated to SA2s, and on the right, the same forecasts are shown on more granular SAFi geography.
Forecasting demand for a catchment?
Whether you’re planning schools, retail stores or any other type of location-based service, this is a particular issue if you’re analysing how much growth is forecast within a catchment around a particular location. The following video case study shows how geography has the power to change the evidence base that underpins your next project.
In this case study you can plainly see that there is significant growth in the Munno Para West – Angle Vale SA2, but it’s all in the North and East corners, with very little growth in the western side of the SA2.
If a new store location were proposed in King Road, Penfield Gardens, assuming a 3.5-kilometre radius, there would be a difference of nearly 60,000 people between the SA2 and the SAFi forecasts for population growth over the next 20 years. In many cases, this may change the sales and revenue forecast, but in some cases, like this one, the spatial view of future demand reveals the people planning this store might consider a location further to the North-Eastern corner of the SA2.
This phenomenon is particularly important when growth falls on ‘the other side’ of a railway line, creek or freeway – the natural breaks in our cities and suburbs that people tend not to cross to access services.
Why have we compared SAFi with SA2s?
State Government population projections are a source of forecasts most people will come across in their research. These are an important set of forecasts to consider, as they typically reflect the strategy and intention of that government’s planning policies. However, in most cases, these forecasts are produced for SA2s (statistical areas containing between 3,000 and 25,000 people), so the forecasts are limited in their geographic detail or granularity.
Learn more about SAFi forecasts
Our Small Area Forecast information (SAFi) product gives Australian companies detailed insights about how land use and demographic drivers influence population change at the local area level to help them invest in the right place at the right time.
Click here to learn more and see what SAFi can reveal about the future of a place of interest to you.
Also published on Medium.
