Marrowdale: an ageing rural district and a falling school roll
The rural district of Marrowdale has a population of 12,000. The latest census shows 28% aged 65 and over, compared with 18% nationally, and 14% under 16. The only bank and supermarket closed in 2019. A daily bus service runs to the town 18 km away, but the last return is at 15:30. The village primary school has 47 pupils on roll and is projected to fall to 31 by 2028; the local authority says schools need at least 60 to be viable. The nearest secondary school is 24 km away. The health centre opens three mornings a week; the nearest hospital is 45 km away. House prices have risen 32% in five years because of in-migration of retired households, while the median local wage is $21,000. The council has a budget of $1.2 million for either a subsidised demand-responsive transport service or a package to keep the school open.
1. Calculate the old-age dependency ratio and the total dependency ratio for Marrowdale. Explain one economic implication of the age structure.
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Population aged 65+ = 28% × 12,000 = 3,360. Population under 16 = 14% × 12,000 = 1,680. Working-age population = 12,000 − 3,360 − 1,680 = 6,960.
Old-age dependency ratio = (3,360 ÷ 6,960) × 100 = 48.3%. Total dependency ratio = ((3,360 + 1,680) ÷ 6,960) × 100 = 72.4%. This means there are about 48 elderly dependants and 72 dependants in total for every 100 working-age people.
One implication is pressure on health and social care: the health centre opens only three mornings a week and the hospital is 45 km away, so a high old-age ratio means many residents need transport and care services. It also means a smaller local tax base relative to service demand. However, retired in-migrants may bring pensions and spending, so the effect is not only negative; the key issue is whether their income stays locally and whether working-age carers can afford to live there on a $21,000 median wage.
2. Evaluate the two spending options. Which would you recommend and why?
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The transport option would help the 3,360 residents aged 65+ reach the health centre, shops and hospital, and could reduce isolation. A demand-responsive service can be targeted to dispersed rural users, unlike a fixed daily bus with a 15:30 return. It also supports ageing in place and may help younger people without cars.
The school package has weaker numerical justification: the roll is 47, the viability threshold is 60, and the projection is 31 by 2028. Spending $1.2 million to keep a school open below threshold may have a very high cost per pupil and may only delay closure. But closing it could accelerate out-migration of young families, worsening the ageing ratio.
I would recommend the transport option, because it addresses the largest dependent group and a clear access failure, while the school cannot reach viability on current trends. This judgement is conditional: the council should also use the school building as a community hub and monitor whether families leave. If the school is the main reason young families stay, the recommendation would change.
3. Explain why the school roll is falling even though the population is 12,000 and house prices are rising.
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A rising population and rising house prices do not mean more children. The 28% aged 65+ shows that much in-migration is by retired households, who do not have school-age children. At the same time, young adults may be out-migrating because median wages are only $21,000 and house prices have risen 32%, making family housing unaffordable. That reduces the number of births and the number of children who remain locally.
The 14% under 16 confirms a small younger cohort. The school roll of 47, projected to fall to 31, is consistent with this: the district has an ageing structure, not a young family structure. Rising house prices therefore reflect demand from older in-migrants and possibly second-home buyers, not a baby boom. The closure of the bank and supermarket and the poor bus service may also make the village less attractive to young families, reinforcing the decline.