Working paper

Deep and persistent disadvantage in Australia

Poverty Social issues Socioeconomic status Australia
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Strong economic growth is a way of increasing living standards and opportunities. Yet despite growing levels of prosperity over the last two decades, and the unemployment rate more than halving, there are concerns within the community that some Australians are being ‘left behind’.

Headline statistics on Australia’s most disadvantaged people frequently appear in the media, with the number of Australians living below the poverty line being often quoted. But little attention is given to explaining what lies behind these statistics, how much of the story they tell, and the judgments that sit behind them. Poverty, for example, focuses on just one facet of disadvantage and the basis for drawing a line between those living in poverty and those who are not is not always clear.

Nor is it often explained that many of the headline statistics provide a static picture of disadvantage. But what happens over time matters. For example, people can move in and out of disadvantage relatively quickly — such as when they first enter the workforce — while others can remain disadvantaged for extended periods of time. Following the same people over a number of years is critical to understanding deep and persistent disadvantage.

Understanding why people become (and remain) disadvantaged, and the consequences of disadvantage, is challenging. Many of the factors are interlinked, and when combined, can have a compounding effect. Measuring the costs of disadvantage, and who bears them, is also far from straightforward.

A lack of understanding about disadvantage can contribute to misplaced community concerns. It can also be an impediment to good public policy. Sound policy development should be built on an evidence-based understanding of the nature, depth and persistence of disadvantage and the costs it imposes on individuals and the broader Australian community. Support for people who are disadvantaged and the funding of programs to overcome disadvantage can also involve large amounts of taxpayers’ money.

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