As baby boomers head into retirement the ratio of elderly people to workers will double over the next four decades, the NSW Treasury has warned.
While cruise ship operators and walking tour guides will be cheering, the reality is that the swelling "aged dependency ratio" means young people will soon be propping up the state's economy.
At the moment there are four workers to every person over 65. By 2056 this ratio will be closer to 2:1.
Fewer workers means less tax revenue for the government and these retirees are going to increasingly rely on the healthcare system as they age.
The five-yearly Intergenerational Report, to be released by the state government this week, shows the NSW economy will grow by just 2.2 per cent a year over the next 40 years, compared with an average 2.5 per cent over the past 25 years.
The Institute of Public Affairs senior research fellow Mikayla Novak said unless there is urgent economic reform millennials were facing a looming "tax crunch".
"There will be higher taxes on millennials so what it means for a 20-something-year-old today is in 20 years they will be paying the healthcare bills that the elderly demand," Novak told BuzzFeed News.
"It doesn't matter if you're a pensioner or a self-funded retiree, you're going to be using more healthcare and disability services."
NSW treasurer Gladys Berejiklian said by 2056, there will be 2.4 people of working age supporting each person aged 65 and over.
"In 1976, there were seven people of traditional working age for every person over 65," she said.