(Image: AAP/Dan Himbrechts)

Australia will not be building its way out of recession. A new report released by the National Housing Finance and Investment Corporation (NHFIC) today revealed that demand for housing could be cut by between 129,000 and 232,000 over the next three years, a collapse triggered by a fall in migration and population growth.

For decades, high levels of migration was central to Australia's strong economic performance. Thanks to the COVID-19 pandemic, closed borders and a stagnant global economy, Australia's population growth is at its lowest level in more than a century. And it's a dramatic change which will send shock waves across the Australian economy for years to come.

An economy of migrants

Over the last two decades, Australia's population grew at 1.6%, compared to an OECD average of 0.6%. About 60% of that growth comes from migration. And without it, Australia's economic narrative might've looked quite different.