Forecasting Australian fertility by age, region, and birthplace

TL;DR

This paper develops a hierarchical forecasting method for Australian fertility rates by age, region, and birthplace, ensuring consistent sub-national and national forecasts using grouped functional time series models.

Contribution

It introduces a grouped functional time series approach for disaggregating fertility forecasts by multiple demographic factors in Australia.

Findings

Coupled disaggregation and reconciliation improve forecast accuracy.

Significant heterogeneity in fertility by birthplace supports the grouped method.

The method provides consistent forecasts across different levels of demographic detail.

Abstract

Fertility differentials by urban-rural residence and nativity of women in Australia significantly impact population composition at sub-national levels. We aim to provide consistent fertility forecasts for Australian women characterized by age, region, and birthplace. Age-specific fertility rates at the national and sub-national levels obtained from census data between 1981-2011 are jointly modeled and forecast by the grouped functional time series method. Forecasts for women of each region and birthplace are reconciled following the chosen hierarchies to ensure that results at various disaggregation levels consistently sum up to the respective national total. Coupling the region of residence disaggregation structure with the trace minimization reconciliation method produces the most accurate point and interval forecasts. In addition, age-specific fertility rates disaggregated by the birthplace of women show significant heterogeneity that supports the application of the grouped forecasting method.