I have frequently questioned the efficacy of Victoria’s (Melbourne’s) population (immigration) fueled economy because I believe that it is reducing the living standards of the incumbent population:
This view is based on several observations.
First, since the onset of the Global Financial Crisis (GFC) in 2008, per capita gross state product (GSP) in Victoria has barely risen despite strong aggregate (population-driven) growth:
The same has happened with State final demand, which has barely grown in per capita terms despite robust aggregate growth:
Second, Victoria has experienced the lowest increase in per capita GSP in the nation since the GFC:
Third, Victoria has the lowest per capita gross disposable income on the mainland, only beating out lowly Tasmania:
In short, there has been strong growth in overall economic activity, because of all the extra people, but the individual Victorian is no better off in a material economic sense. However, add in broader negative impacts like increased traffic congestion, reduced housing affordability, and overall less amenity, and it is clear that the average Victorian’s living standards are being eroded.
Over the weekend, the self-proclaimed “unabashed supporter of a bigger Australia”, Bernard Salt, also noted that Victoria has become a “battling immigrants” city that has diluted median income:
Melbourne really is evolving into a people’s city. The median income is relatively modest, I think largely because the city is attracting an inordinate number of interstate and overseas migrants, including students. Battling immigrants bring down the city’s median income.
And then there’s the student factor. Between 2011 and last year, Melbourne’s university student population increased by 34 per cent; in Sydney the growth was 28 per cent. The studentification of Melbourne may be setting up the city for a skilled workforce in the future but right now this student tsunami, combined with all manner of immigrants, is bringing down the city’s median income. Cheap eats and bargain retailers are well suited to Melbourne.
This follows Salt’s observation last week that “there is no doubt that congestion is choking Melbourne”.
Since Bernard Salt is one of the biggest supporters of mass immigration and a ‘Big Australia’, and given his comments above, he really does need to explain how growing Melbourne to more than 8 million people mid-century and 11 million by century’s ends (under his own projections – see below) is a recipe for boosting Melbournian’s living standards?
Surely such manic population growth would merely further dilute median income and worsen Melbourne’s already “choking” congestion, would it not?
