Australia’s population outlook: What it means for the early childhood sector

The Australian Government’s release of the 2025 Population Statement provides a timely snapshot of demographic change, one with significant implications for early childhood education and care (ECEC) services across the country. The latest projections confirm slowing population growth, declining birth rates, and a shift toward an ageing population, reinforcing the need for strategic planning, policy alignment and investment in the early years.

The Statement, released by the Centre for Population, confirms that:

• Net overseas migration is moderating, expected to fall to 260,000 in 2025–26, roughly half the post-COVID peak.
• Population growth will slow to 1.3% in 2025–26 and to 1.2% annually from 2026–27, down from a 1.4% average in the 2010s.
• Australia’s birth rate is projected to fall to a record low in 2025–26.
• The median age is increasing, forecast to reach 40 years within the decade and 43.7 by 2065–66.

These figures signal a major demographic shift that will influence demand for early learning services, workforce planning, and long-term educational investment.

What this means for ECEC providers and policy leaders

1. Falling birth rates may reduce enrolment pressure in some regions, particularly in metropolitan areas already experiencing a plateau in early childhood numbers. Services will need to review demand forecasts and tailor future planning accordingly.
2. Targeted infrastructure investment in growth corridors and outer regional areas remains essential, particularly where young families are still settling due to housing affordability.
3. Workforce supply and cultural diversity may shift in response to slower migration. This may affect recruitment strategies and community engagement models, especially for services supporting children from CALD backgrounds.
4. Population ageing increases the economic imperative for early years investment. With fewer working-age adults supporting a growing older population, early learning plays a pivotal role in ensuring future productivity, workforce participation (particularly of parents) and social cohesion.

The Albanese Government has acknowledged these pressures and opportunities, linking the Population Statement to recent reforms designed to support families and stimulate inclusive economic growth. These include:

• The 3-Day Guarantee for early childhood education and care, aimed at ensuring affordable access for all children
• Expanded and enhanced Paid Parental Leave to give families greater flexibility and support in the early years

These initiatives, coupled with targeted workforce development and cost-of-living relief, aim to ease barriers to family formation and support long-term educational and economic outcomes.

As the sector prepares for sweeping reforms to the National Quality Framework (NQF) in 2026, including mandatory child safety training and the launch of the National Early Childhood Worker Register, providers must also adapt to broader population dynamics that affect demand, workforce, and family needs.

ECEC leaders, approved providers, and policymakers will benefit from integrating the 2025 Population Statement into their strategic frameworks. Proactive service planning, strong advocacy, and informed investment in the early years will be critical to ensuring that every child, regardless of demographic shifts, has access to quality education and care.

For more information, visit the Centre for Population 2025 Population Statement.