At the national level there is a gap between the socio-economic circumstances of Indigenous and non-Indigenous Australians. Some readers may imagine that this gap can be explained by the poor circumstances of the minority of the Indigenous population who live in remote areas (25.4 per cent). The author dispels this hypothesis. Using the principal components analysis approach he examines the socio-economic circumstances of Indigenous Australians in urban areas (that is cities and large regional towns). He finds that in all cases Indigenous Australians in urban areas are worse off than are non-Indigenous Australians
INTRODUCTION AND OVERVIEW
Indigenous Australians on average suffer substantial economic and social disadvantage. Altman, Biddle and Hunter (1) showed that, in 2006, Indigenous Australians were 3.06 times as likely to be unemployed, 0.41 times as likely to own their own home and had a median personal income that was only 0.58 times as high as the non-Indigenous population. In other data from the most recent (2006) census, only 23.9 per cent of the Indigenous population aged 15 years and over had completed high school, slightly less than half the rate for the non-Indigenous population (49.7 percent). More than three-quarters (76.3 per cent) of the Indigenous population aged 15 years and over had not completed either a degree or trade qualification, 1.41 times the rate for the non-Indigenous population (54.1 per cent).
In his Apology to Australia's Indigenous Peoples, (2) the Prime Minister Kevin Rudd resolved to 'set concrete targets for the future' in order to close the gap between Indigenous and non-Indigenous Australians across a range of indicators relating to key policy concerns. These have been formalised through the Council of Australia Governments (CoAG) through six key targets around health, education and employment. Although such targets are set at the national, state or territory level, many of the programs aimed at improving Indigenous outcomes are delivered at the local or community level. For example, on 21 April 2009 the Commonwealth Indigenous Affairs Minister, Jenny Macklin, identified 26 remote communities and towns that would be targeted as priority locations across Australia. (3)
In order to effectively allocate scarce resources, it is important that those areas with the greatest level of need be identified. In a recent analysis of the distribution of Indigenous socioeconomic outcomes, Biddle (4) showed that the areas with the greatest level of disadvantage in terms of employment, education, housing and income were in remote parts of the country. As Indigenous Australians make up 27.1 per cent of remote and very remote Australia compared to 2.5 per cent nationally, (5) one could reasonably ask whether the main reason for there being a large gap between Indigenous and non-Indigenous Australians in terms of measured outcomes is the respective geographical distribution of the populations.
If living in remote Australia was the main cause of Indigenous socioeconomic disadvantage, then the policy response that would follow would most likely consist of encouraging the population to move to urban centres either through incentives or by removing services from remote Australia. On the other hand, if there were large gaps in outcomes between Indigenous and non-Indigenous Australians in all or at least most locations across Australia then the policy prescription would be very different. Under this scenario, a large-scale movement of remote Indigenous Australians to regional and urban parts of the country would not have a substantial impact on the gap between the Indigenous and non-Indigenous population. There may or may not be benefits for an individual Indigenous person or family that moves from a remote to a non-remote area, though there would obviously be a need to equip those who did move with the requisite skills and training to compete in urban labour markets. However there are unlikely to be any benefits for the roughly three quarters of the Indigenous population who already live in cities or regional areas.
The aim of this paper is to identify the level of socioeconomic disparity between the urban Indigenous and non-Indigenous population in a given location. The analysis focuses on urban areas for two reasons. Firstly, because the concept and measurement of advantage or disadvantage used in the paper is less applicable in remote Australia, especially when comparing Indigenous and non-Indigenous Australians. This is because of very different labour markets (in part because of the existence of the Community Development and Employment Projects [CDEP] scheme) as well as different land tenure arrangements and hence housing markets...