Supply and demand; Australia as an ageing nation

Tuesday, March 21, 2017

DEMAND: AUSTRALIA AS AN AGEING NATION

A CLEAR AGEING TRAJECTORY

Australia is experiencing a baby boom, with births exceeding 300,000 a year. 30 years ago, the over 65s made up just 11% of our population (one in nine persons). Today the over 65s make up 15% of our population (one in seven). Forecasts project that this cohort will make up 18% in 2027 (one in six). By 2047 one in five Australians (20%) will be aged over 65.

AGEING SOCIETY

Our median age is also increasing. Three decades ago the median age of an Australian was 31.3. Today it is 37.4 and in 2047 it is projected to be just under 40.

85+ POPULATION

The over 85s, where there is an even greater need for aged care services, are growing at a faster rate than the over 65s. In 1987 there were 133,448 Australians aged over 85. Today there are four times as many, and in 2047 there will 14 times as many.

INCREASED LONGEVITY

Not only are there more older people in our nation, but Australians are living longer than ever before. Life expectancy at birth in 1987 was 76.3, whereas today it is 81 for a male and 85 for a female. In 2047, it is projected to 89.9.

HEALTH ADVANCEMENTS ARE INCREASING LONGEVITY

The primary enabler of this increased longevity gain has been the health system rather than individual behaviour. Life expectancy increases will continue because of improved medical technologies, public health infrastructure and better public health measures. New and improved medical interventions will also contribute, as will the improved survivability rates of major illnesses and cancers.

A decade ago, dementia and Alzheimer’s disease were the 6th largest causes of death in Australia. Today they are the 3rd leading causes of death with the number of deaths having more than doubled to 9,864. Over the same period of time, deaths due to the first and second causes of death (heart disease and brain disease) have been decreasing. If today’s current trend continues, by 2021 dementia and Alzheimer’s disease will be the leading cause of death in Australia.

EXPONENTIAL GROWTH OF CENTENARIANS WILL KEEP THE QUEEN BUSY

In 1952, the year that Queen Elizabeth II became sovereign, 40 letters of congratulations would need to have been written to Australians turning 100. This year, 2,925 Australians will turn 100 and in 10 years 5,401 will turn 100. In 30 years the number of congratulatory letters written to Australians turning 100 will increase to 25,938 in the year 2047.

SUPPLY: AUSTRALIA AS AN AGEING NATION

THE CHALLENGE OF SUPPLY

Not only is there an increasing demand on the services provided by the aged care sector with the growing number of over 85s, there is also a workforce supply challenge.

RATIO OF WORKERS TO RETIREES DECLINING

The ageing population will place greater demands for productivity on the labour force. In 1975 for every person of retirement age there were 7.1 people in the working age population. By 2015 there were just 4.5 people of working age for every individual of retirement age, and this is projected to decline to just 2.7 people of working age for every individual at retirement age by 2055.

IMPENDING RETIREMENTS

Because of the high median age of an employee in the aged care sector, half of the aged care workforce will be of retirement age in 15 years. There are 350,000 workers in the aged care sector (estimated in 2012), so this equates to an average of 11,667 retirements per year for the next 15 years. This averages to 972 farewell lunches per month!

If we are to keep the current ratio of aged care workers to people aged over 85 in our nation, we need to add 129,945 workers in the next 10 years. This equates to recruiting 1,083 new workers per month, in addition to replacing the 972 retiring staff per month.

That’s a total recruitment goal of 2,055 each month – adding nearly 25,000 individuals to Australia’s aged care workforce each year.

GET IN TOUCH

To find out more about McCrindle's expertise in the aged care industry, or how we can communicate these insights to your team, please get in touch.

External Trends Impacting the NFP Sector in 2017

Wednesday, February 22, 2017

The year 2017 has begun in an environment of perplexed global sentiment. From Brexit to the election of President Trump, the last 9 months have been far from a smooth ride on the world stage, showing a trend towards growing isolationism and increasing uncertainty.

At the national level, for most advanced economies, this uncertainty has bred an increase in nationalism, and a move away from globalisation. In Australia, our response – in part fuelled by our strong work ethic and historic undercurrent – makes us all just want to ‘get on with it’ and get the job done.

For the not for profit sector, this means working hard at strategic initiatives, managing external risk, and taking bold initiatives to engage donors. Our conversations with the NFP sector at this time of year often involves developing strategic brand tracking to measure public engagement, or testing specific brand assets to develop powerful advertising campaigns.

Yet, before delving into the tools of marketing and communications, it is critical that NFPs grasp the trends and undercurrents taking place in the external environment, particularly those that impact donor giving. Here are three trends we feel are critical for the NFP sector to grapple with in 2017:

1. Charity saturation and the need for brand differentiation

According to JBWere’s Cause Report (2016), Australia has 56,894 NFP organisation, one NFP for every 422 individuals. The number of not for profit organisations has doubled every 20 years over the last 60 years – and despite cancelling and closure of some charities by the ACNC, there are still around 10 new charities established every business day.

2. Overall decline in public giving necessitating new fundraising initiatives

Charitable giving has been lower in Australia in 2016 than in years prior. The NAB Charitable Giving Index indicates that national giving is down, by a decrease of 0.3% growth in the 12 months leading up to Aug 2016. This compares to 5.1% growth a year earlier. While there has been resilience in the Australian economy during this time, consumers are more cautious than before, reflected by these figures.

3. Younger generations giving less and seeking experiential engagement

60% of Australian donors agree that charities will face a more difficult future as younger generations don’t seem to volunteer in an ongoing way or give as much as the generations before them (McCrindle Australian Communities Trends Report, 2016). NAB data shows that those aged 15 to 24 give just $135 on average, annually, to charities, compared to those over 65 who give $452 on average.

BEHIND THE TRENDS

A number of these trends are explained by a rise in the cost of living across Australia. Take Sydney housing as a case example of the growing cost of living pressures. In 1975, Sydney house prices were just 5x average annual earnings. By 1995 they had risen to 6x average annual earnings, but today – when taking the average annual salary of $80,000 per year and the median house price of well over $1 million – the average house price is 13x the cost of an average annual full-time salary.

Australian donors are finding it more difficult to give, and to give regularly. As the traditional, dependable, regular donor shrinks as a proportion of all donors, new types of donors are emerging –brand responders and opportunity givers.

ENGAGING AD-HOC DONORS


Brand responders and opportunity givers donate sporadically, in an ad-hoc way. These types of donors are still more likely to give to a single charity or cause than to multiple causes, and have a strong preference for a particularly cause or charity.

Through speaking with more than a dozen NFP experts, 54 donors face to face, and surveying 1,500 Australians, we have identified four key next steps for the charitable sector to take into account in 2017:

1. Develop Multi-Tiered Levels of Engagement

Donors want to be involved with charities, but on their own terms. Rather than fixed contracts, they desire flexible giving and varied involvement. The demand for personalisation is growing as donors expect charity engagement suited to their age and life stage.

2. Build Communities for Social Impact

Australian donors desire to be part of a community of activists that bring about social change. They want to be involved in something bigger than themselves, knowing that together they can make a difference. This is not just ‘clicktivism’, which is seen merely as a form of virtue signalling through web-based activist organisations. Globally, networks like Avaaz.org and Change.org have created opportunities for real-life engagement of social issues, facilitated first through online platforms.

3. Communicate Results in Real-Time

Donors want real-time results and transparent reporting of admin costs. Platforms such as GiveDirectly.org now enable donors to give directly to an individual living in extreme poverty via mobile giving. KIVA, a lending platform facilitating crowd-sourced micro loans across the globe, displays the giving of loans in real-time via an interactive world map. When donors have this type of visibility, trust and engagement follow.

4. Create Fun and Engaging Experiences

The donor of the future is looking for participation and memories created through experiences. Nearly half (46%) of 18-29 year-old Australian donors have volunteered for a charity (compared to 31% of 30+ donors), and they are looking to do so in new, fresh ways. This is not just contained to events and a physical presence at sporting events or music festivals. Many young donors (1 in 4 of those aged 18-29, compared to just 11% of 30+ year-old donors) prefer the creative challenge of conducting their own fundraising events, providing them with the opportunity to harness their unique gifts and talents for a great cause.

-Eliane Miles

FOR MORE INFORMATION

For more information on Australian Donors, see the Australian Communities Trends Report Infographic.

Connect with us if you would like more information on environmental scanning for strategic forecasting.

ABOUT ELIANE MILES

Eliane Miles is a social researcher, trends analyst and Director of Research at the internationally recognised McCrindle. As a data analyst she understands the power of big data to inform strategic direction. Managing research across multiple sectors and locations, she is well positioned to understand the mega trends transforming the workplace, household and consumer landscapes. Her expertise is in telling the story embedded in the data and communicating the insights in visual and practical ways. Download Eliane's professional speaking pack here.

To inquire about Eliane presenting at your next event, please feel free to get in touch.

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