It’s not surprising that Melbourne’s population fell during the pandemic, as multiple COVID outbreaks sent the city into frequent lockdowns and international borders closed.
But data suggests the drop will be just a small blip in the city’s trajectory.
Melbourne’s population went down by more than 60,000 in the 12 months to September 2021, according to Australian Bureau of Statistics data released in March — the biggest drop of any capital city.
People leaving Melbourne for other parts of the country accounted for a bit over a third of that number, but the rest was due to a plunge in overseas migration.
And the exodus isn’t over yet, with federal government projections forecasting Melbourne’s population will drop again this year.
But despite the dip, the big picture is unchanged — by 2030, Melbourne is tipped to overtake Sydney to become Australia’s biggest city, according to the federal government’s Centre for Population projections.
It will be a bumpy ride to get there, with push and pull factors changing in the face of the pandemic.
Here’s what’s driving the change.
Sydney loses population to internal migration
Liz Allen, a demographer at the Australian National University, said the closure of the international border during COVID had had massive impacts on Melbourne and Sydney’s populations because they were the country’s most global cities.
“Migrants tend to live in cities,” she said.
“There are good education and employment opportunities, and the cultural connections make establishing oneself in Australia more successful.”
Liz Allen says Melbourne is an attractive city for migrants.(Supplied)
However, University of Melbourne demographer Thomas Wilson said that while Sydney attracted new migrants, it struggled to hold on to them, due in part to high cost of living.
“Sydney does have quite strong net overseas migration gains, but it’s traditionally lost a lot of people through internal migration,” he said.
“The assumption in the Centre for Population’s projections is that Melbourne is probably going to have slightly higher overseas migration and a lot less negative internal migration.”
However, he cautioned that the projections assumed Melbourne would return to the growth it experienced pre-pandemic, and should be taken with a grain of salt as demographers cannot predict future influencing factors like migration policy changes and recessions.
At the height of the pandemic, Melbourne’s shrinking population, along with COVID-19 isolation rules, led some businesses to complain of staff shortages.
Dr Allen said migrants were essential for Melbourne and Australia more broadly to flourish.
“We do certainly need to return to the pre-COVID population trends to be able to have a thriving economy,” she said.
International students key to CBD
Within Victoria, the City of Melbourne had the biggest population decline of any local government area (LGA).
Melbourne Lord Mayor Sally Capp said the city’s population drop was largely due to the closure of international borders.
Council data shows that before the pandemic hit, international students made up 38 per cent of the CBD’s population and 39 per cent of inner-city Carlton’s.
“While we have been able to steadily welcome back international students since borders reopened, the number of international students in Victoria is still down by 36 per cent compared to March 2020,” Ms Capp said.
The Melbourne CBD is much quieter with international student numbers still down.(ABC News: Simon Tucci)
Dr Allen said exclusionary policies during the pandemic may be slowing the bounce-back for overseas migration.
Temporary visa holders were not eligible for federal disaster assistance payments, and in April 2020 Prime Minister Scott Morrison told international students and visitor visa holders who could not support themselves that it was “time to go home”.
During the pandemic, Asian Australians also reported increased experiences of racism — particularly in the Chinese community.
“During COVID, Australia wasn’t terribly welcoming and that did not go unnoticed overseas,” Dr Allen said.
“It will take some time for Australia to rebuild its reputation and to once again show the world that it is a welcoming place.”
City dwellers fleeing for the regions
While Melbourne’s population is expected to keep growing after the pandemic downturn, regional Victoria is experiencing that change now.
Victoria’s idyllic Surf Coast, taking in beach towns like Torquay and Lorne, has seen the flip side of population change.
The LGA grew by more than 1,500 residents — or 4.4 per cent — in a year.
A combination of factors brought about by the pandemic led Vanessa Borg to start building her first home in Torquay towards the end of 2020.
She grew up in Melbourne’s west, but moved to Geelong a year before the pandemic hit for work.
“Because of the pandemic, I couldn’t go anywhere. I was able to save a lot more, I got very lucky — I didn’t lose my job,” she said.
“It kind of geared me in towards looking for a home sooner than I thought I would be able to.”
Vanessa Borg is building a home in Torquay.(Supplied)
Because of the “ring of steel”, which separated metropolitan Melbourne from regional Victoria during the height of the pandemic, Ms Borg could not travel to Melbourne from Geelong to look at homes.
“But I could go anywhere in regional Victoria,” she said.
She found a property in Torquay by the beach that was within her price range and a relatively short commute from her work in Geelong — which allows her to work from home a few days a week.
Ms Borg received $45,000 in total from the the state government’s first home owner’s grant — which incentivised buying in the regions — and the federal government’s home builder grant.
One of the reasons she is building in Torquay is because it was cheaper than buying in Melbourne, where the median house price was over $800,000 in March.
“The cost is mind blowing — it really it would hurt my pocket and my soul to be buying anywhere near Melbourne,” she said.
Locals in coastal towns have warned tourism and sea-changers are putting pressure on the cost of living, but Dr Allen said this was more to do with investors and developers looking to “amass wealth” than growing populations.
Governments must ‘properly invest’ in growing regions
Lisa Newton, the owner of Dustys Bulk Foods in Torquay, can see the benefits of a growing population.
“I speak to at least one to two people every few days saying they’ve just made the move to Torquay or surrounds,” she said.
She said business was booming thanks to the new arrivals, and the new residents have been well received.
“The growing population is so great for small businesses like ours.”
Dr Allen said governments needed to invest in growing regional Australia, given the “enormous disparities” in education, employment and health outcomes.
“People can live less of a life, in terms of years, beyond city limits in Australia,” she said. “That’s an enormous failing and we need to address that.”
“[Politicians] need to properly invest in regional areas, not just in the economic industries of an area but the social infrastructure — the people, the humanity, that makes these areas,” she said.
Mr Wilson said investment in infrastructure, transport and housing will also be vital in Melbourne as it continues to take in more residents.
“Often, it’s been said that Australian cities have got too many people, but perhaps it’s more the case that they don’t have the infrastructure for the current population,” he said.
“We need to make sure that we’re we’re planning for that population growth in the future.”