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Over the next 40 years, the number of Australians aged 65 and over will more than double.
That's the forecast from the government's Intergenerational Report.
It means a significant proportion of Australians will age out of the workforce in the coming years.
Economists and groups like the Business Council of Australia are among those urging the government to look to migration to fill the vacancies those retirements will create.
University of New South Wales Associate Professor Mark Humphery-Jenner says without migration the shrinking workforce would place a significant burden on younger people.
"So in essence we're looking at a confluence of declining revenue, at least from that proportion of the population, and increasing expenditure, which puts more of a burden onto the personal income taxes of perhaps the younger generation, which is a massive issue we're seeing in the intergenerational report. And migration is one way to help to mitigate that, particularly if you could help to increase the overall tax base by perhaps bringing in younger migrants, who could perhaps help to lessen some of that burden."
The Grattan Institute's Economic Policy Program director, Brendan Coates, says there's a good reason why migration should be encouraged.
"Most migrants arrive in Australia when they’re relatively young, as international students, as skilled migrants, or as the spouses of Australians. They tend to be young. And obviously they age, but they spend 30, 40 years in the workforce and smooth out, as a result, smooth out that ageing of the Australian population and really slow it down."
Other groups are urging caution.
Yamamah Agha is the General Manager for Newcomer Support at Settlement Services International.
She says once they arrive in Australia, many migrants and refugees face barriers such as insufficient language support.
Yamamah says Australia must improve its migration system to support them more effectively, and take full advantage of what they have to offer.
"The workforce of migrants settling in Australia, they have a lot to offer but they’re kind of overlooked in the current system, because of the overseas qualification system."
For Professor Humphery-Jenner, visas are also a major issue.
"There's absolutely barriers in terms of visas. Many migrants want to enter the workforce in Australia. We've got many graduates going through universities that really do want to stay within Australia. They've been qualified in Australian universities, built up skills over here, oftentimes built up networks of friends or family over here. They would very much like to stay in Australia. However the visa system makes it quite difficult. So the skilled visas are notoriously challenging to get. And if we don't loosen up some of those systems, it will make it difficult to attract people."
Professor Humphery-Jenner says without major changes, Australia risks losing talent to other Western countries - such as Canada, England and the US, a concern the Business Council of Australia also shares.
But a second major issue is Australia's cost of living and housing affordability crisis, many fearing a large intake of migrants could become scapegoats for rising prices.
Most experts point the finger at planning laws and supply.
National Cabinet recently announced a major policy to address supply, with give states and territories to receive up to three billion dollars if they reach an updated target of building one-point-two million new homes over the next five years.
Brendan Coates says that is a good start.
"That’s the kind - an example of - the kinds of things we need to do, to make sure that states in particular are able to deliver the housing that’s needed to house a growing population. We also should be looking closely at infrastructure, to make sure we’re building the right kinds of infrastructure in the right places to manage that population growth. But ultimately it’s about planning for that population growth as best we can, to make sure that we retain popular support for migration, particularly skilled migration, because it does supply very large benefits the Australian community."
Professor Humphery-Jenner says communicating the benefits of migration will also be key.
“It’s challenging, it appears, for politicians to encourage more migration without fearing an electoral backlash, and politicians should perhaps manage their messaging in advance. By helping to communicate to the Australian population that it helps everyone to encourage more migration. And that’s not just more skilled migration per se, but also more migration that would enable more family reunions which helps to make Australia a more attractive destination to migrants. And there are clear benefits to Australians from that. Clear benefits in terms of increased productivity, in terms of increased innovation, in terms of increased diversity, which helps to improve overall productivity and national growth."
