The population of NSW is set to grow by 40% according to a 40 year forecast for the state in its 2021-22 intergenerational report.
The 120-page report published by NSW Treasury paints a rosy picture for the state over the next four decades, with predictions the average age for people born in 2061 growing to about 92 for women and 89 years for men.
Average full time wages are expected to increase to approximately $139,000 per year compared with $86,000 in 2018-19. And workers will be expected to join a workforce that is highly skilled and more concentrated in sectors such as social and business services.
But with the population growth in NSW, an additional 1.7 million homes will need to be built in the state by 2061.
“We are very lucky to live in one of the greatest places on the planet, but if we are to ensure the next generation enjoys the same levels of prosperity and opportunity that we have today it is vital we identify future challenges and work to overcome them,” NSW Treasurer Dominic Perrottet said.
NSW Treasury releases a new intergenerational report every five years with a view to assisting policymakers plan for the future. It draws on forecasts using key demographic, housing, workforce and economic data to identify some of the future demands on the state’s resources.
According to the treasurer, a sovereign wealth fund established in 2018 known as the NSW Generations Fund (NGF) is just one approach the state has adopted to prepare for the future. The fund is expected to reach $430 billion by 2061-61 (31% of GSP).
“We have already taken steps such as setting up the NGF to help secure the future for future generations but there is still much more work to be done and the IGR will help ensure we make the right decisions at the right time,” Perrottet said.
“The way things will look for the people of NSW in 40 years will be vastly different to the world today.”
The report suggests that economic growth in NSW will be driven by productivity, increasing at 1.2% every year until 2061. It also forecasts that the fiscal gap will be 2.6% of GSP.
NSW Treasury has said the predicted fiscal gap will require further action to avoid the state’s gross debt growing becoming unsustainable.