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State Library of VictoriaPublic Libraries Seminar

The Big Shift – business implications of demographic & cultural change for Melbourne

Bernard Salt

Author The Big Shift

Partner KPMG Australia

13 June 2003

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The push from the bush

• Suburban culture emerged during the 20th Century• Provincial coastal culture now ascendant • Underpinned by lifestyle-seeking baby boomers• Edna Everage; Neighbours 1985; Kath & Kim 2002

2001

Inner city5%

Suburbia58%

Rural18%

Coastal19%

1901

Inner city25%

Suburbia15%

Rural52%

Coastal8%

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1. Gold Coast 14,7542. Casey 10,0733. Brisbane South West 7,2674. Melton 5,9345. Brisbane North West 5,5216. Wyndham 5,4637. Blacktown 5,3108. Pine Rivers 5,1369. Baulkham Hills 4,52710. Brisbane South East 4,501

18. Melbourne 3,28321. South Sydney 2,824

“We’re goin’a surf city … gonna have some fun”

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Why population shifts are important to business

10,000 extra residents support job growth, eg:

• 3,700 new suburban households, or

• 6,700 new inner-city households

• $70 million in new retail spending*

• $25 million in new supermarket spending*

• ½ a Kmart

• One cinema screen

• 7,500 cubic metres of pre mix concrete

Population loss reverse these markets

*includes GST

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Growth hotspots in Melbourne

Outside top 10

• Hume (4,367)

• Greater Geelong (3,686)

• Brimbank (3,371)

• Mornington Peninsula (3,368)

• Melbourne (3,283)

• Whittlesea (2,766)

Seachange impact on Bellarine & Mornington Peninsulas

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Segment hotspots across Melbourne

• Boomers to Casey, Melton East & Craigieburn

• Xers to Casey, Melton East & Craigieburn

• Lone persons to CBD, Port Melbourne & Knox North

• Never married men (25-34) to Whittlesea South, Yarra Ranges South West & Keilor

• Never married women (25-34) to St Kilda, Richmond & Knox North

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Bleeding bush … and the blooming beach

Broome

Narooma

Victor HarbourDenmarkAugusta-MargaretRiver

Geraldton

Busselton

Nowra-Bomaderry

Port StephensPort MacquarieCoffs Harbour

Gold CoastCaloundraNoosaHervey Bay

Yeppoon

WhitsundayTownsville

CairnsPort Douglas

Sorell

Palmerston

Leonora

MacedonRanges

Losers

Winners

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Victorian cities are no longer the losers they once were

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The real action outside Melbourne is focussed on lifestyle towns: Echuca, Torquay, Daylesford, Mansfield and the coast within a 90 minute drive of the CBD

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Growing DecliningPhoenix +950 Baltimore -85Los Angeles +1,467 Philadelphia -68Houston +582 Pittsburgh -55Fort Lauderdale +368 Detroit -50Dallas +366 St Louis -48

LAPhoenixDallas

HoustonFort Lauderdale

St Louis

Detroit

Pittsburgh

PhiladelphiaBaltimore

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Inter-city commuting on the rise … Australians pursue lifestyle options

2001 Change since 96

1. Sydney – Wollongong 18,239 19%

2. Brisbane – Gold Coast 15,195 23%

3. Sydney – Newcastle 11,519 1%

4. Melbourne – Geelong 10,146 18%

5. Perth – Mandurah 5,656 18%

6. Brisbane – Sunshine Coast

4,531 14%

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Chic-house city living

• Out with Neighbours … in with Friends, Seinfeld, Sex and the City, The Secret Life of Us

• Out with the stubbie … in with elegant longneck boutique beer bottles with a designer label

Sydney 6,000

Melbourne 4,834

Brisbane 4,215

Perth 1,516

Canberra 872

Adelaide 618

Darwin 225

Hobart 7

Total 18,287

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Sydney and Melbourne lead the big shift downtown

-10,000

-5,000

0

5,000

10,000

15,000

20,000

1976-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000/01 2001/02

Year

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Sydney Melbourne Balance

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Age Group

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Age Group

Pop

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Sydney

Melbourne

20-somethings lead the charge downtown

3,013 more 20-24 year olds in 2001 than 15-19 year olds in 1996

2,810 more 25-29 year olds in 2001 than 20-24 year olds in 1996

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0

5

10

15

20

25

30

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1921 1933 1947 1954 1961 1966 1971 1976 1981 1986 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

The ageing of the average Aussie bride

Xer brides 29 in 2001

Bridegrooms

Baby boomer brideswere 21 in 1971

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Women want to work … and will make further gains by 2016

-100

1020304050607080

15-19 20-24 25-34 35-44 45-54 55-59 60-64 65+

1981 1998 2016

%

Professional working women demand their own drink eg Cosmopolitan

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No real change to male participation rates

-100

102030405060708090

100

15-19 20-24 25-34 35-44 45-54 55-59 60-64 65+

1981 1998 2016

%

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0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

1946 1951 1956 1961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011 2021 2031 2041 2051

Year

Po

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Baby boomers just won’t die!

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It doesn’t get any better after 43-48

40

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$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

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150000

200000

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Born 1931

‘Rich’ live longer

Boomer mid-pointTotal populationby single year

Pre-boomer’sslide

Boomers at their peak until June 2006 … then the slide begins

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$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000

15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 9910

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$10,000

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Average income by age 1986

Average income by age 2001

39 44

43 48

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20-something 50-something

2002 2.726m 2.385m

2021 2.975m 3.049m

Trendy to be fifty … in 2021

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The Shakira conspiracy

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Born Label Age 2001

2001(m)

2021(m)

1931-1946 Pre-boomers

55-69 2.5 1.6

1946-1961 Boomers 40-54 4.1 3.9

1961-1976 Xers 25-39 4.4 4.6

1976-1991 Ys 10-24 4.1 4.6

1991-2006 Zs 0-9 2.6 4.3

Why the fixation with Baby Boomers?

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… but the Swedes can’t surf!

Million Growth Million Growth

1801 0.1 - - -

1851 1.0 0.9 - -

1901 3.7 2.7 - -

1951 8.5 4.8 7.0 -

2001 19.4 10.9 8.9 1.9

2051 25.4 6.0 8.4 -0.5

2101 25.3 -0.1 8.3 -0.1

Australia Sweden

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Implications for business• Financial - later commitment to mortgages; savvy

older consumers; succession planning; superannuation; blending work and life

• Retail - shopping centre locations; shopping hours and flexibility; CBD supermarkets & convenience stores; bulky goods from household formation

• Consumer Goods - boomers want ‘lite’, fast, healthy foods eg noodles; fashion to accommodate larger sizes; longnecks replace stubbies; European & Asian food influences

• Motor vehicles - 4WD giving over to 20-something female cars, eg Honda Jazz, VW Polo

• Pharmaceutical - staying young, fit and vital; shift to wellness; nicotine patches

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Dense Australians in 2001

• Zipcode 10128 has 59,000 people per sqkm

Upper East Side Kings Squash

• Kings Cross has 18,000

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Further information & contact

• Population Growth database 2002 – March 2003

• The Big Shift 2 – mid-July 2003

• Links: www.thebigshift.com; www.kpmg.com.au

• Contact: Bernard Salt (03) 9288 5047; bsalt@kpmg.com.au

• Bernard Salt’s column appears in The Australian every second Thursday (next 12 June 2003)

• KPMG Firstbuy – pick-up on your way out