Yasmin Noone
28th November 2017

Interactive: Find out how your neighbourhood compares to the rest of Australia

While Australia is a country rich in natural resources and social opportunities, our nation’s wealth is not spread equally among all of its residents.

We know that the gap between the highest and lowest income earners has been widening over the past 20 to 30 years. But what does that mean for the way you live your life and your own state of wellbeing?

As the chief economist at the Australian Bureau of Statistics (ABS) Bruce Hockman explains, there are a number of determinants, other than income, which will influence your potential to live a life of advantage or relative poverty.

He tells SBS your socioeconomic status can also be influenced by factors like education, overcrowding in your home, whether you’re a single parent, have a disability and have access to a car.

“People want to see how they rate, relative to others in the community.”

“The characteristics of areas in the most advantaged regions are more likely to have people with more years of education and higher incomes,” Hockman says, “and residents are less likely to be unemployed and more likely to have motor vehicles.

“If you have low English language abilities, you are also more likely to be disadvantaged in the Australian community.”

One economic term, which combines all of these factors to determine whether or not the average household in your region is advantaged or disadvantaged compared to others in Australia, is the Index of Relative Socioeconomic Advantage and Disadvantaged (IRSAD).

Based on 2011 census data from the ABS, regions are given an IRSAD score and assigned to a decile – with 10 representing the most advantaged region, one the most disadvantaged, and five meaning your area shares the same status as half of the population.

“People want to see how they rate, relative to others in the community,” explains Hockman. “So you need to look at the index as being measured along a continuum: you look along the line and see where your household fits compared to others.”

The IRSAD is the default index charted region-by-region in the map of Australia below.

The gap between advantaged and disadvantaged areas can be easily seen by examining various capital cities, like Canberra, where neighbouring areas have vastly different decile ranks and therefore contrasting levels of advantage.

“A suburb with a lot of people with professions won’t necessarily be a better community to live in than one with lots of tradespeople.”

For example, according to the map, some localities in the ACT region are ranked in the first decile, meaning the people in that area – on average – are among the most disadvantaged in the country. Meanwhile, Yarralumla, Deakin and Forest – areas which circle the ACT’s political centre – are among the country’s most advantaged, ranking in the tenth IRSAD decile. That means the average resident has access to the nation’s highest incomes, employment and social opportunities compared to most other regions throughout Australia.

On the other side of the country, a large section of the map falling over the Northern Territory and inland parts of Western Australia is marked as deep red, indicating that the areas are all extremely disadvantaged, falling within decile 1.

Australian University Fellow, Nicholas Biddle, explains this level of disadvantage in remote parts of Australia in an article for The Conversation: “A massive 37 per cent of Indigenous Australians live in the most disadvantaged decile compared to only two per cent who live in the most advantaged decile,” he writes.

“Not only are Indigenous Australians relatively disadvantaged themselves, they live in areas where their neighbours and friends are disadvantaged. As it is these neighbours and friends that people often use to obtain labour market, education and financial support, then it is quite possible that this area-level disadvantage contributes to individual disadvantage.”

How important is it to know your level of advantage?

Deputy director of the Social Policy Research Centre at University of NSW, kylie valentine* stresses the importance of the IRSAD measure of advantage or disadvantage for governments and policy-makers wanting to distribute resources to the areas of greatest need.

However, valentine says, the index is an average calculation and generalises that everyone in the one area will have the same income and lifestyle. So there will always be exceptions to the rule.

She adds that the index also doesn’t capture the strength of communities and assumes a white-educated middle class norm is the best way to live.

“What we can be confident in saying is that being poor in rich unequal countries is really bad for you, and that regardless of whether you focus on poverty, disadvantage, or inequality, millions of Australians are suffering the impacts.”

“The measures chosen are economically robust but they’re limited,” says valentine.

“Disadvantaged communities may also have heaps of strengths that aren’t easy to measure,” like cultural traditions, celebrations and community-bonds, which aren’t economic concepts and aren’t included in the IRSAD calculation.

“A suburb with a lot of people with professions won’t necessarily be a better community to live in than one with lots of tradespeople.”

Despite the measure’s limits, valentine states an important overall finding from the data: disadvantage is a national problem, which shouldn’t be ignored.

“What we can be confident in saying is that being poor in rich unequal countries is really bad for you, and that regardless of whether you focus on poverty, disadvantage, or inequality, millions of Australians are suffering the impacts.”

*Ed’s note: Name intentionally spelled in lower case at the request of interviewee

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Split into 10 equal deciles - Index of Relative Socio-Economic Advantage and Disadvantage

(click map for area name)

Socio-Economic Indexes for Areas (SEIFA) Score Decile
Index of Relative Socio-Economic Advantage and Disadvantage (IRSAD)
Index of Relative Socio-Economic Disadvantage (IRSD)
Index of Economic Resources (IER)
Index of Education and Occupation (IEO)

Socio-Economic Indexes for Areas (SEIFA) provide summary measures derived from the Census and can help users understand the relative level of social and economic wellbeing of a region. SEIFA uses a broad definition of relative socio-economic disadvantage in terms of people's access to material and social resources and their ability to participate in society.

SEIFA is a set of four indexes which rank geographical areas across Australia. These indexes are ranked by a score based on the characteristics of the people, families and dwellings in these areas. This can be used to determine where the wealthy live, where the disadvantaged live, and where the highly skilled and educated live.

Index of Relative Socio-Economic Disadvantage (IRSD)

Is a general socio-economic index that summarises a range of information about the economic and social conditions of people and households within an area. Unlike the other indexes, this index includes only measures of relative disadvantage.

Index of Relative Socio-Economic Advantage and Disadvantage (IRSAD)

This index summarises information about the economic and social conditions of people and households within an area, including both relative advantage and disadvantage measures.

Index of Economic Resources (IER)

This index focuses on the financial aspects of relative socio-economic advantage and disadvantage, by summarising variables related to income and wealth. This index excludes education and occupation variables because they are not direct measures of economic resources. It also misses some assets such as savings or equities which, although relevant, could not be included because this information was not collected.

Index of Education and Occupation (IEO)

This Index is designed to reflect the educational and occupational level of communities. The education variables in this index show either the level of qualification achieved or whether further education is being undertaken. The occupation variables classify the workforce into the major groups and skill levels of the Australian and New Zealand Standard Classification of Occupations (ANZSCO) and the unemployed. This index does not include any income variables.

Notes

The areas shown are ‘Statistical Area Level 2’ (SA2) standard areas as used by the Australian Bureau of Statistics. SA2 is a general purpose, medium-sized area, which is used to represent communities that interact socially and economically.

Areas show no data if the analysed population is below 200.

Source: Australian Bureau of Statistics 2033.0.55.001 - Census of Population and Housing: Socio-Economic Indexes for Areas (SEIFA), Australia, 2011

The new series of Struggle Street starts Tuesday 28 November 8.30pm on SBS. #strugglestreet

A two-week event: Tuesday-Thursday.

Struggle Street series two is produced by KEO Films with funding support from Screen Australia and Film Victoria.
All episodes of Struggle Street will be available to view on SBS On Demand after broadcast.
Episodes one, two and three will encore on Viceland on Friday 1 December from 8.30pm, while episodes four, five and six will encore on Viceland on Friday 8 December from 9pm.
NITV's The Point will host a special show to discuss the issues raised in the documentary on Wednesday 29 November 9.30pm.
The Feed Special will also air on Viceland on Friday 8 December at 8.30pm.