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Fault Lines Exposed: Advantage and Disadvantage Across Australia’s Settlement System

CHAPTER FOUR

MINING, TOURISM, SEA-CHANGERS AND AGRICULTURE

WHAT IS HAPPENING IN OUR LARGE REGIONAL CITIES AND TOWNS?

Scott Baum
Kevin O’Connor
Robert Stimson

This chapter extends the focus of the book by considering the first of the non-metropolitan groups. The large non-metropolitan cities, towns and regions considered in this chapter are those places with populations greater than 10,000 and are also the places where the majority of the population is counted as being urban. Using the methodology outlined in Chapter One, six groups are developed that make up the typology of advantage and disadvantage across the large non-metropolitan cities, towns and regions. From the six groups we get three groups of advantaged places and three groups of disadvantaged places. The advantaged places are income advantaged mining large non-metropolitan cities, towns and regions, service-based advantaged large non-metropolitan cities, towns and regions and tourism/population-boom advantaged large non-metropolitan cities, towns and regions. The disadvantaged places are agricultural-based disadvantaged large non-metropolitan cities, towns and regions, employment disadvantaged large non-metropolitan cities, towns and regions and welfare/retirement disadvantaged large non-metropolitan cities, towns and regions. The chapter discusses each of these in turn.

INTRODUCTION

A decade or so ago this book might have finished at Chapter Three, or at the most had another chapter which attempted to explain what has been happening in regional (non-metropolitan) Australia. But things have changed. As any number of the books which have come out in recent years will tell you non-metropolitan Australia now matters (Beer et al. 2003; Gray and Lawrence 2001; Lockie and Bourke 2001). One only needs to look at the political fall-out surrounding Pauline Hanson’s One Nation Party and the backlash against Jeff Kennett during his last election campaign when he proclaimed that ‘Melbourne was the heart of Victoria’ to see that those who ignore non-metropolitan Australia, and fail to consider its diverse characteristics, do so at their own risk. Flinders University geographer Andrew Beer is one supporter of this view, and he and his colleagues argue that:

 

thinking of the nation’s geography in the simple terms of an urban/rural dichotomy has little merit. This dichotomy fails to take into account the significant differences that exist both within metropolitan areas and within rural and regional Australia (Beer et al. 2003 p. 73).

The point is that it is necessary to consider the range of outcomes occurring in non-metropolitan cities and towns. This is what this chapter and the two following attempt to do.

The large non-metropolitan cities, towns and regions are the focus of this chapter. They comprise an important part of Australia’s settlement hierarchy and they play important roles in Australia’s export performance. They include centres important for the extraction, processing and shipment of raw materials and agricultural and pastoral products. They also include centres important for providing educational services business services and distribution services such as retailing. Like the metropolitan regions, the large non metropolitan cities and towns show considerable differences in a range of outcomes. These are discussed in this chapter.

DIFFERENTIATING THE LARGE NON-METROPOLITAN CITIES, TOWNS AND REGIONS

The large non-metropolitan cities, towns and regions considered in this chapter are those places with populations greater than 10,000 (the populations range between 10,032 in Katherine in the Northern Territory to 381,308 in the Gold Coast, Queensland) and are also the places where the majority of the population is counted as being urban. These large cities, towns and regions account for a large proportion of Australia’s population. Approximately 20 per cent or around 4 million people live in these places. Being large and mainly urban, many of the cities, towns and regions discussed in this chapter have similar roles to the large metropolitan regions. However, the 119 cities, towns and regions do display differences.

Like the metropolitan regions discussed in Chapter Three, we begin with our aggregate 119 cities, towns and regions and using the methodology and indicators outlined in Chapter One came up with six groups (Figure 4.1) whose socio-economic position can be seen in the data presented in Table 4.1ac and 4.2ac and the selected data in Table 4.9ah. From the six groups we get three groups of advantaged places and three groups of disadvantaged places. The advantaged places are 8 income advantaged mining large non-metropolitan cities, towns and regions, 31 service-based advantaged large non-metropolitan cities, towns and regions and 13 tourism/population-boom advantaged large non-metropolitan cities, towns and regions. The disadvantaged places are 22 agricultural-based disadvantaged large non-metropolitan cities, towns and regions, 24 employment disadvantaged large non-metropolitan cities, towns and regions and 21 welfare/retirement disadvantaged large non-metropolitan cities, towns and regions. It is these six different groups that we now consider in detail.

Figure 4.1 Typology of advantaged and disadvantaged localities in Australia’s large non-metropolitan cities, towns and regions

Table 4.1a Means of socio-economic variables, three advantaged groups of large non-metropolitan cities, towns and regions
Note: Cells that are bold and shaded indicate that this is an important differentiating variable and sets this group apart from others.
Cells that are bolded only indicate that this is an important variable, but does not individually differentiate this group from others.
Cells in italics indicate that the variables are of interest in that the mean is above or below the average, but they do not differentiate the groups from others.

Table 4.1b Means of socio-economic variables, three advantaged groups of large non-metropolitan cities, towns and regions (continued)
Note: Cells that are bold and shaded indicate that this is an important differentiating variable and sets this group apart from others.
Cells that are bolded only indicate that this is an important variable, but does not individually differentiate this group from others.
Cells in italics indicate that the variables are of interest in that the mean is above or below the average, but they do not differentiate the groups from others.

Table 4.1c Means of socio-economic variables, three advantaged groups of large non-metropolitan cities, towns and regions (continued)
Note: Cells that are bold and shaded indicate that this is an important differentiating variable and sets this group apart from others.
Cells that are bolded only indicate that this is an important variable, but does not individually differentiate this group from others.
Cells in italics indicate that the variables are of interest in that the mean is above or below the average, but they do not differentiate the groups from others.

 

Table 4.2a Means of socio-economic variables, three disadvantaged groups of large non-metropolitan cities, towns and regions
Note: Cells that are bold and shaded indicate that this is an important differentiating variable and sets this group apart from others.
Cells that are bolded only indicate that this is an important variable, but does not individually differentiate this group from others.
Cells in italics indicate that the variables are of interest in that the mean is above or below the average, but they do not differentiate the groups from others.

Table 4.2b Means of socio-economic variables, three disadvantaged groups of large non-metropolitan cities, towns and regions (continued)
Note: Cells that are bold and shaded indicate that this is an important differentiating variable and sets this group apart from others.
Cells that are bolded only indicate that this is an important variable, but does not individually differentiate this group from others.
Cells in italics indicate that the variables are of interest in that the mean is above or below the average, but they do not differentiate the groups from others.

Table 4.2c Means of socio-economic variables, three disadvantaged groups of large non-metropolitan cities, towns and regions (continued)
Note: Cells that are bold and shaded indicate that this is an important differentiating variable and sets this group apart from others.
Cells that are bolded only indicate that this is an important variable, but does not individually differentiate this group from others.
Cells in italics indicate that the variables are of interest in that the mean is above or below the average, but they do not differentiate the groups from others.

ADVANTAGED CITIES, TOWNS AND REGIONS

MINING ADVANTAGE (INCOME ADVANTAGED MINING LARGE NON-METROPOLITAN CITIES, TOWNS AND REGIONS)

Just as the metropolitan regions have localities characterised by high incomes, there is a group of localities within the large regional places that is also characterised by residents with significantly high incomes. These large regional high-income cities and towns are places built around mining and they are clearly advantaged (Table 4.3). Bernard Salt (2001) in his book The Big Shift counts many of these places among the richest localities in the country. While the mining industry has seen changes over the past two or three decades, the continued strong growth in world resource prices has seen the industry and localities associated with the mining sector prosper. They are, according to Westpac economist Justin Smirk (2004), ‘booming along’. Parched desolate areas are often associated with these places, but there is diversity. Ross Terrill (2000), discussing the Western Australian mining community of Port Hedland suggests that:

 

It is a marriage of red earth and blue water. There are palms and oleanders and frangipanis, and beyond them a pink expanse of desert, looking flattened by the overarching canopy of blue sky (p178).

In Queensland Mount Isa with its mining of copper, lead, silver and zinc and Emerald (coal mining) are included in this group, as is Singleton and Muswellbrook in New South Wales, both of which have a mining industry based on coal (Muswellbrook also has some pastoral industries). In Western Australia there is Kalgoorlie/Boulder (famous for gold mining) and Port Hedland (Box 4.1) which processes iron ore and is the gateway to the mining company towns in the Pilbara.

The advantage in these places is driven by income. Those employed in the mines work long hours, but are rewarded well for it. ABS figures indicate that those employed in the mining sector are among the highest paid in the nation. And the figures from the Australian Taxation Office used in this analysis further reinforce this. The average wage for workers in the group of mining localities is 1.3 times higher than the average for all the non-metropolitan cities, towns and regions considered in this chapter, with Port Hedland having the highest average wages and salaries at $43,071. But for all this income, taxpayers in these localities don’t seem to save much; bank interest and imputation credits received are below average.

Disadvantage is not abundantly apparent in the mining localities, although it does exist. The labour market appears strong with high rates of labour-force participation and low levels of unemployment being the key indicators. There are some households headed by single-parents and there are even some families with no parental wage earner, but the proportion of these households is below the average. Not surprisingly, the mining localities do not have high proportions of public housing tenants, nor do they have high proportions of households suffering from financial hardship caused by the combination of low incomes and high housing costs. There are also low levels of government income support flowing to these areas, especially in terms of pensions.

It doesn’t come as a surprise that these places have high numbers of their workforce engaged in the mining industry – the share is greater than any of the other groups and is well above the average. Jobs in other industries are apparent, but the share of these jobs in total is less important.

Table 4.3 Mining advantaged cities, towns and regions

Box 4.1 Port Hedland (Western Australia), a mining advantaged town

 

Port Hedland is located 1,761 kilometres north of Perth and is a remote town belonging to the group of income advantaged mining localities. It has a population of around 12,000 people and is one of the largest iron ore ports in Australia with over 70 million tonnes of product, worth more than $3 billion, shipped each year. The town’s major symbols are the iron ore crushing mill located at Nelson Point, the port itself and the seemingly endless iron ore trains (as long as 3 kilometres and with up to 300 wagons) which move back and forth from the mines at Mount Newman. While it is an example of a town whose success is dependent on mining outputs it also produces salt from evaporation ponds and has a pastoral and tourism industry. Its economic base is not surprisingly reflected in high levels of employment in mining with around 18 per cent of the workforce employed in the industry.

Port Hedland’s profile reflects a town with a strongly performing economy and little social malaise. It has low levels of unemployment (5.4 per cent) and a youth unemployment rate of 11 per cent and has little evidence of dependence on government income transfers. Less than 2 per cent of the population receive an aged pension (which is reflective of the age profile of the town) and there is also less than 2 per cent of people receiving rental relief. Further to this, ABS data suggests that around 90 per cent of all income comes from wages and salaries (which on average are around $43,000) with a further 5 to 6 per cent of incomes coming from some form of government transfer. The level of wages and salaries is high when compared to the average for Western Australia which is around $32,000. Reflecting this, the ABS places Port Hedland in the 8th decile in terms of its index of relative socio-economic advantage/disadvantage. Full-time employment accounts for a large proportion of jobs with less than one-quarter of those who are employed working part-time. The labour-force participation rate is 65.6 per cent. The town has a below average proportion of single-parents (14.5 per cent) and families with no employed parent (9.5 per cent) and also has low proportions of age dependency (5.8 per cent) and households suffering from rental or mortgage financial stress.

SERVICE CENTRES (SERVICE-BASED ADVANTAGED LARGE NON-METROPOLITAN CITIES, TOWNS AND REGIONS)

Consider a map of Australia; the big dots (usually representing population size) outside the metropolitan regions are likely to represent a group of large regional service towns. Several are identified here, and most play important support roles for both their local populations as well as populations from surrounding areas (Beer et al 2003). These advantaged service towns have diverse socio-economic characteristics and are generally doing well. Some of these places have regional universities and other educational facilities. They are often the localities of decentralised government offices and some have defence bases. They are also the localities of base hospitals and other necessary health facilities. Some of these places are likely to be sponge cities that draw in population from surrounding towns or regions and are able to absorb excess labour from these places. They are also places that have been able to overcome decline as many of them have taken on higher order functions similar to metropolitan regions.

The service-based advantaged localities in New South Wales include Lake Macquarie and Newcastle in the Hunter Valley as well as the cities of Bathurst (famous for car races) and Orange (Box 4.2). In Queensland, Rockhampton and Townsville (considered by some as the capital of North Queensland) are in this group, while in Victoria Warnambool and Greater Shepparton are included. South Australia has Mount Gambier and Port Lincoln in the group, Western Australia has Bunbury and Tasmania has West Tamar (Table 4.4).

Table 4.4 Service centres

The service-based localities are not really separated out from other places by anything in particular. They do have lower unemployment rates and higher labour-force participation rates than the average large non-metropolitan locality. They are however, to some extent in the middle of all the other places. Just as the metropolitan regions have middle suburbia, so the large non-metropolitan places have these middle towns.

Employment in these places reflects the broad service role and population-based functions of these places. New-economy functions have moved into many of these service towns and there is an above average level of educated professionals and an average level of vulnerable occupations. Mass goods and services industries, which include soldiers, sailors, teachers etc, are evident here, in fact on average this sector accounts for the largest proportion of employment. People working in mining and other extractive industries are not found in these places to any large extent although the service functions of many of the cities and towns included in this group means that they are a jumping off point for workers in these industries, especially mining. Nor are they the movers and shakers of non-metropolitan tourism and recreation. Some of these places do have established tourist industries – for example, Townsville has Magnetic Island, a suburb just off the coast – but mostly workers in mass recreation industries are not abundant.

These places don’t come across as the super wealthy localities in non-metropolitan Australia. They have more low-income households than high-income households and wages are only just above the average. There are some investors here, with the localities on average receiving $364 in imputation credits. The level of people with basic schooling is below the average, although still high at close to 50 per cent. There are pockets of disadvantage with single-parent households, people receiving aged pensions and rent assistance payments, and public housing tenants being above the average. This is perhaps more likely to be an outcome of the diversity of population apparent in many of the cities and towns rather than entrenched disadvantage per se.

Box 4.2 Orange (New South Wales), a service-based advantaged centre

 

Located 261 kilometres west of Sydney, the city of Orange is a substantial rural service centre with a population of around 37,000 people in 2003. With its surrounding towns and villages it supports a population of around 100,000 through its industrial, commercial and services resources. Orange’s industry base is significant and diverse, ranging from apples through to whitegoods manufacturing, mining, tourism, agricultural support and research facilities, and it lies at the heart of some of New South Wales’ richest agricultural lands on the Central Tablelands. Orange is one of the largest urban centres in New South Wales and is a significant regional employment centre. Its employment base is highly reliant on the mass goods and services industries (including government administration, retailing, and health and education services) accounting for over 40 per cent of the employed labour force and there are also new-economy occupations (12.4 per cent). The city has low unemployment with a total rate of 7.3 per cent and has an above average rate of labour-force participation (61.2 per cent). Orange has slightly more low-income households than high-income households (a ratio of 0.6:1) and average wages and salaries are just under $32,000 (below the average for New South Wales). On other measures of socio-economic performance Orange is close to the average. Single-parents account for 17.7 per cent of all families and non-earner households account for 14 per cent. Just over 9 per cent of all households with a mortgage suffer financial stress through high repayments and just over 50 per cent of the population older than 15 years had left school at the minimum age.

THOSE PLACES THAT ARE BOOMING (TOURISM/POPULATION-BOOM ADVANTAGED LARGE NON-METROPOLITAN CITIES, TOWNS AND REGIONS)

Around 4.8 million overseas tourists visit Australia each year (that’s around 40 full jumbo jets – assuming some first class and business class travellers – each day). According to the Bureau of Tourism Research some of these tourists go to Sydney and other capital cities but others head for non-metropolitan Australia and the places that are the tourist drawcards outside the big cities (Bureau of Tourism Research 2000). The tourism/population-boom regions make up another advantaged group of localities – regional scientists might call these places ‘population hot spots’ (Stimson et al. 1998; Baum and O’Connor 2005) (Table 4.5). Most of them have strong tourism bases, but a small proportion stand out because of their strong population growth. The tourism localities reflect the overwhelming growth in international and domestic tourism that has occurred over the past few decades. They are advantaged because they have been able to tap into what Andrew Beer and his colleagues (Beer et al. 2003) refer to as ‘sunrise industries’ or emerging industries, with some being the locations that sociologist Pat Mullins (1991) refers to when he talks about places being redeveloped for tourists. Population-boom places are growing due to amenity, a desire by in-migrants for a sea-change (or tree-change) or due to the proximity and easy accessibility to a major metropolitan city for weekend tourists.

Table 4.5 Tourist and population boomers

Cairns (Box 4.3), with its access to the Great Barrier Reef and Douglas (Port Douglas) with its luxury resorts easily comes to mind when thinking about tourism-based places in regional Australia. Then there is Alice Springs and Katherine in the Northern Territory and in Western Australia there is Broome, home to tourist resorts and pearls. New South Wales has the Snowy River region with its emphasis on winter sports and more recently a burgeoning wine industry. Besides these established tourism places this group has some relatively recent population-boom localities. Queanbeyan just outside of Canberra had some serious population growth between 1991 and 2001 as did Thuringowa, Gladstone and Calliope in Queensland. Thuringowa has been growing for some time boosted by the twin city service functions of itself and Townsville, while the latter have grown in part thanks to the development of new energy and mineral processing facilities located in Gladstone. Finally, Greenough, near Geraldton in Western Australia has grown due to the outward expansion of Geraldton.

Within the tourism/population-boom cities, towns and regions population growth is well above average and there is also above average growth in employment. Advantage in terms of incomes and strong labour-force characteristics also set this group apart from the others. In income terms these places are not up there with the mining giants, but nor are they doing too badly. There are slightly more high-income households than low-income households (although it is nearly balanced) and average wages and salaries are around $31,000. Employment in the mass goods and services industries and mass recreation industries dominate the employment structure, with over half of all employees working in these industries. The new-economy has also come to these places with workers employed in new-economy industries being above average. Reflecting this there is, on average, higher proportions of people characterised as educated professionals, and there is a higher than average level of labour-force participation.

The indicators of advantage also extend to include a relative lack of disadvantaged households – families with no employed parents are below the average – and there is a relatively low proportion of households suffering financial difficulty through paying high rents (and having low incomes) and those receiving rental assistance.

Box 4.3 Cairns (Queensland), an advantaged tourism town

 

One of the success stories in regional Australia is Cairns (population around 117,000), in far north Queensland, which is in the group of tourism/population-boom advantaged localities. Cairns is a city driven by tourism. Its fundamental reason for being is to attract tourists and to provide them with a wealth of ways to spend their money from gift shops to reef visits and snorkelling. The far north Queensland region had the fourth highest visitor numbers and accounted for around one-fifth of total international visitors (Bureau of Tourism Research 2000). Reflecting this tourist hub function, the city’s industry and employment base is concentrated in mass goods and services industries (retailing, government services) and mass recreation industries (accommodation, cafes). Together these two sectors account for over half of the employment in the city, with new-economy employment accounting for a further 13 per cent. Cairns has high levels of labour-force participation (65 per cent) and below average unemployment (7.9 per cent). It has had population growth (23.1 per cent) and commensurately has witnessed employment growth (29.7 per cent). Thus Cairns has many of the hallmarks reflecting positive adjustment to structural change as highlighted in a report by the Australian Productivity Commission (1998).

Cairns has a level of wages and salaries slightly above the average ($29,617) and has slightly more low-income households than high-income households (a ratio of 1.25:1). Cairns has a below average proportion of people receiving aged pensions (4.9 per cent), although there are an above average level of people receiving rental assistance (7.3 per cent). ABS figures indicate that wages and salaries account for around 75 per cent of all income with government transfers accounting for approximately 11 per cent. The level of imputation credits received and interest earned is below average with around $320 in imputation credits and $420 of interest received in 2001. Reflecting this advantaged position, the ABS places Cairns in the 8th decile in terms of its index of relative socio-economic advantage/disadvantage.

DISADVANTAGED CITIES, TOWNS AND REGIONS

AGRICULTURAL REGIONS STRUGGLING ALONG (AGRICULTURAL-BASED DISADVANTAGED LARGE NON-METROPOLITAN CITIES, TOWNS AND REGIONS)

A widely held view of regional Australia is that it is in crisis (Gray and Lawrence 2001; Lockie and Bourke 2001). Often this relates to the outcomes of restructuring in the agricultural sector and the impacts that this has had on regions based on farming and pastoral activities. As Mark Vaile, Minister for Trade said in 2001 ‘Australians know very well that Australia no longer lives off the sheep’s back, neither in relation to the wool industry itself, nor in terms of commodity industries in general’ (Foreign Affairs and Trade 2001 p. iii). This falling off the sheep’s back is seen in declining regional incomes in localities that were once strong and vibrant agricultural economies, with declines in farming income flowing on to impact on the viability of retail and other services in local towns (Gray and Lawrence 2001; Conway 1995; Gow 1994; Gray et al. 1993). Considering this at length Gray and Lawrence (2001 p. 53) argue, that the process of change in regional Australia is:

 

to a substantial degree, propelled by the restructuring of farming. The social, as well as economic bases of farming are changing fundamentally… From a sociological perspective we see people and their communities being forced to make fundamental changes which are likely to affect them detrimentally and severely, potentially affecting their livelihoods, state of health and general quality of life.

The places included in this group of agricultural-based disadvantaged localities are found in the wheat-sheep belt of New South Wales and Victoria, but are found in other states as well (Table 4.6). Bowen with its beef cattle (Box 4.4) and Kingaroy, home to peanuts and ex-Queensland premier Joh Bjelke-Petersen, are included in this group as are fruit growing/processing places like Campaspe – Kyabram (Victoria) and Leeton (Leeton also produces cereal and livestock) in New South Wales. Ararat, the pastoral based locality in Victoria and Mudgee (New South Wales) – sheep, wine and agricultural produce – are in the group and in Western Australia there is Esperance, known for its wheat, sheep and cattle.

The defining feature of disadvantage in this group of localities is income, or lack of very high incomes. Wages are below average and there are more low-income households than high-income households. In terms of population these agricultural regions are declining or are becoming stagnant regions. As many researchers have pointed out this is in part due to young people leaving the farm in search for a better economic life (Gray and Lawrence 2001; Salt 2001). Other places, according to Salt (2001 p. 139) are upstaging these localities and are draining ‘resources and jobs away from traditional heartland towns’.

Low incomes and population loss (and commensurately employment loss as well) are not the only thing happening in these localities. There are people employed in occupations which might be characterised as vulnerable jobs (there are also high rates of low formal education) and these places certainly are not the places where down-shifters and sea-changers are moving. There are relatively low numbers of educated professionals – the good jobs – and the new-economy occupations have not moved into the local labour markets. Nor are there people employed in other more population oriented/consumption type industries like mass recreation sectors.

Despite low incomes there are some assets; bank interest received is above average and the level of home ownership is high. There are also relatively low proportions of households suffering from rental financial stress. Unlike the other disadvantaged places labour-force outcomes here are not too bad. In fact they are quite good, with below average unemployment and above average labour-force participation, although it can be argued that this is an outcome of population decline as those unable to find work move elsewhere. Other indicators of disadvantage are also relatively low. There are low proportions of single-parent households and families with no wage earner and there are also low levels of rent assistance.

Table 4.6 Localities falling off the sheep’s back

Box 4.4 Bowen (Queensland), a disadvantaged agricultural region

 

Bowen in central north Queensland is located 1,165 kilometres from Brisbane and 206 kilometres from Townsville and is an example of an agricultural-based disadvantaged region. The shire has a land area of around 21,000 square kilometres and estimates for 2003 place population at around 12,500. Bowen’s industries include beef cattle production, a salt works producing nearly 30,000 tonnes a year, coke (up to 38,000 tonnes a year), and tomato and fish processing plants. The total value of agriculture in 2003 was $203 million. Reflecting the agricultural nature of the Bowen economy this sector accounts for a significant level of employment, almost one-third, with a large proportion also employed in the mass goods and services industries. Reflecting the declining incomes that have characterised agricultural operations Bowen has below average levels of wages and salaries ($27,095) and there are around 2.5 times more low-income households than high-income households. Further reflecting the disadvantage of Bowen, relative to other localities Australia wide, the ABS places the shire in the bottom decile in its index of socio-economic advantage/disadvantage. Australian Taxation Office data indicates that the average level of tax paid is only around $6,700 which translates into an effective tax rate of 16 per cent. The large proportion of total personal income comes from wages and salaries with about 17 per cent coming from government transfers (both pension recipients and people receiving rental relief are above average in Bowen). Income from investments are about average in Bowen with, on average, $239 coming from imputation credits and $651 coming from bank interest.

In some ways the labour market outcomes in Bowen are, like other places in the group, generally positive. The level of unemployment is 7.4 per cent, which is below average although the level of labour-force participation is also below average at around 55 per cent. Youth unemployment is below average at 12.5 per cent. Reflecting the industrial structure of the region, there are a larger share of people employed in vulnerable occupations than in jobs characterised as professional occupations and commensurately, there is a significant proportion of people with low levels of education. The low incomes of Bowen may be partially explained by the above average levels of age dependency (24.5 per cent), but other indicators often associated with low incomes such as single-parent families and non-earner families are below average. There is a below average level of households suffering from mortgage or rental financial stress and over 40 per cent of households own their homes.

UNEMPLOYMENT CENTRES (EMPLOYMENT DISADVANTAGED LARGE NON-METROPOLITAN CITIES, TOWNS AND REGIONS)

A look around the large non-metropolitan regions suggests that some places, like their metropolitan cousins, have suffered at the hand of economic restructuring and have become places of disadvantage and declining opportunity (Beer et al. 2003). It is these places that the shift away from protectionism and the reorganisation and decline of old-economy manufacturing industries has hit hard and has resulted in job loss. They are sometimes places of population decline as residents leave these population cold spots for the promise of a better economic future elsewhere (Gray and Lawrence 2001; Salt 2001). And it is these places (alongside the declining agricultural centres) that have been at the centre of concerns regarding the demise of services that seem to follow population loss, a problem which may become self sustaining (Sorenson 1992).

Twenty-four cities, towns and regions are included in this group (Table 4.7). The towns of the iron triangle in South Australia (Whyalla, Port Pirie and Port Augusta) are included on this list. These are places that have been hit hard by the de-industrialisation process that has in the past adversely impacted on South Australia more generally. In New South Wales, Kempsey (Box 4.5) and the older mining towns of Cessnock and Broken Hill are included, both of which in economic terms have seen better days. Despite its production of Australia’s most consumed rum (the makers of Bundaberg Rum claim it is the most popular Australian spirit, capturing 10 per cent of the spirits consumption market), Bundaberg in Queensland has not been able to shake disadvantage, and Maryborough, just near the retirement town of Hervey Bay, is also included on the list. In Victoria, Portland is included as well as towns in the La Trobe Valley, while Western Australia is represented on the list by Geraldton. Tasmania, the other rust-belt state (along with South Australia) includes Central Coast and Devonport.

Table 4.7 Unemployment centres

People who are not employed are a distinguishing feature of these localities. Unemployment, both for adults generally as well as for those aged less than 25 years, is high and reflects the labour-market disadvantage associated with many localities in this group. Kempsey in New South Wales has a very high unemployment rate (16.5 per cent), as do places such as South Australia’s Port Pirie (13.8 per cent) and Victoria’s Latrobe-Moe (15.3 per cent). With a labour-force participation rate of just over 50 per cent there are almost as many people of working age not in the labour-force as there are in it. Again, wages and salaries are low for this disadvantaged group of localities, and in addition there are more low-income households than high-income households. And not surprisingly, investments in this group of localities are not significant with low levels of imputation credits and bank interest received.

But it is not all about people being unemployed. For those who are working, jobs in vulnerable occupations are above average and commensurately, educated professionals and managers are lacking in the places in this group. Across industry sectors mass goods and services account for a large share of employment. And reflecting this distribution of jobs, there is a more than average incidence of people with only a minimum level of schooling. Other measures of disadvantage are also evident. There is a high presence of families with no employed parent and a high incidence of low-income households paying high rents. The localities in this group are also unlikely to have residents who have recently arrived in Australia, and although not a differentiating factor this group as a whole suffered population loss over the decade 1991 to 2001.

Box 4.5 Kempsey (New South Wales), employment disadvantaged town

 

Kempsey, 428 kilometres north-east of Sydney on the Macleay River, is an example of an employment disadvantaged place. It is located approximately halfway between Sydney and the Queensland border and is a service town for the surrounding region. Its industry base is focused on manufacturing (with several large companies located here), but also includes timber, beef and dairy cattle. Reflecting this, old-economy employment and agricultural employment each account for around 7 per cent, with the majority of the employment base located in mass goods and services industries. Jobs characterised as vulnerable account for one-fifth of all employment. One of the defining features of Kempsey is the level of unemployment which in 2001 was around 16.5 per cent, with a youth unemployment rate of around 26 per cent, significantly higher than for the total of the large non-metropolitan cities, towns and regions. It also has a below average level of labour-force participation (48.3 per cent) and there are high proportions of people who left school at 15 years of age (64.2 per cent). The ABS places Kempsey in the lowest decile on its index of socio-economic advantage/disadvantage.

Reflecting these disadvantaged labour market outcomes, Kempsey has below average wages and salaries ($26,654) and there are around six times as many low-income households as high-income households. Australian Taxation Office figures indicate that the average level of tax is $5,767 in 2001, representing an effective tax rate of 15 per cent. Just over 50 per cent of the level of personal income comes from wages and salaries with almost one-third being derived from government transfers (11.8 per cent of people receive an aged pension and 7.9 per cent of people receive rental assistance). Interestingly, despite these figures the level of bank interest received is above average at $882. Other indications of disadvantage can also be observed with around 20 per cent of total families being single-parent families and the level of non-earner families being above average (21.6 per cent). There is a high level of age dependency (27.5 per cent) and reflecting this there is a high level of home ownership. Households suffering from rental financial stress are also significant with 27.1 per cent of all renters suffering disadvantage.

‘MY PARENTS HAVE MOVED TO THE SUNSHINE’ (WELFARE/RETIREMENT DISADVANTAGED LARGE NON-METROPOLITAN CITIES, TOWNS AND REGIONS)

Sun-belt migration has been a phenomenon shaping the socio-economic structure of many (mainly) coastal localities over the past decade or so (Beer et al. 2003; Beer et al. 1994; Maher and Stimson 1994). It is clearly associated with populations in search of a sea-change and with those who have been labelled as down-shifters. It has also more often than not been associated with welfare or retirement based migration patterns as many retired people move to the coast in search of their sea-change. It is this retirement migration that has sustained and driven the population turnaround occurring in many places, although as Burnley and Murphy (2004) point out, it is not simply retired sea-changers, but a whole spectrum of movers including those who move as free agents and those who might be forced to move (single-parents and the unemployed) in search of cheaper living arrangements.

So where are the people moving? The coast and particularly places in northern New South Wales and southern and central coastal Queensland are popular (Table 4.8). There is Port Stephens and Byron Bay in New South Wales, and Burnett and Hervey Bay (Box 4.6) in Queensland. But there are other places as well. East Gippsland – Bairnsdale represents Victoria while in South Australia the Copper Coast, which includes places such as Kadina, Moonta and Wallaroo, makes the list. In Western Australia Busselton and Albany are included. Interestingly, Queensland’s Gold Coast and Sunshine Coast also make the list, representing the pull of these high-amenity urban tourism areas to some sea-changers and retirees (Mullins 1991).

Wayne Swan (2005) argues that the sun-belt is ‘where sun and sand are more plentiful than economic opportunities’ and this is reflected in the level of incomes and wages in this group. These places are income poor. They have more low-income households than high-income households (a ratio of 4 to1) and wages and salaries ($27,123) are below average. These places also have a high level of people receiving a retirement pension, a finding supported by the ABS figures suggesting that a significant proportion of incomes in some of these cities, towns and regions are obtained from government transfers. However, these places are asset rich with a significant level of taxation imputation credits and bank interest received. Their disadvantage (and their characterisation as welfare-migration localities) is illustrated by the high level of total unemployment and youth unemployment, the high incidence of housing financial stress and the high incidence of people receiving rental assistance. Labour-force participation is low in these localities, and there is a high incidence of part-time employment often associated with the type of service jobs located in these places.

The welfare/retirement disadvantaged locations had both population and employment growth, although much of the employment growth is likely to be in consumer services jobs which often offer less security and lower pay (Beer et al. 2003). Despite the disadvantage of this group in terms of incomes the occupation/industry characteristics include above average rates of good jobs (educated professionals, possibly employed in population-based services such as health), but the majority of employment is in the mass goods and services sector and the mass recreation sector. Reflecting the impact of population growth, employment in the construction industry is also above average. There is a high proportion of home owners and a low proportion of public renters. Not surprisingly the retirement/welfare localities have high rates of age dependency, reflecting the age structure of many of these places.

Table 4.8 Following the sunshine

Box 4.6 Hervey Bay (Queensland), the retirement zone

 

Hervey Bay is located 300 kilometres north of Brisbane and is a good example of the rapidly growing towns and centres strung along the New South Wales and Queensland coast that make up the bulk of the welfare/retirement migration sea-change localities. With a population of around 40,000 in 2001, Hervey Bay is one of the larger urban centres in regional Queensland, and has been growing rapidly. Over the past decade the estimated resident population of this coastal settlement has grown by 47 per cent and commensurately employment has grown by 57 per cent. Its economic base is characterised by employment in mass goods and services industries (retailing, health and community services etc.) which accounts for 45 per cent of all employment. Employment in mass recreation industries (accommodation and cafes) and new-economy industries account for around 11 per cent each.

In terms of social disadvantage, Hervey Bay has high concentrations of single-parent families (16.4 per cent) and families with no employed parent (17.9 per cent). It is ranked in the bottom decile on the ABS index of advantage/disadvantage. Unemployment is well above the average at 14.9 per cent and youth unemployment is 24.4 per cent. Hervey Bay has a significant proportion of low-income earners with wages and salaries on average being $25,314 and five times as many low-income households as high-income households. Mean annual tax is $5,637 with an effective tax rate of 15 per cent. Only 53.8 per cent of personal income comes from wages and salaries with around 28 per cent coming from government transfer payments; 14.9 per cent of people received aged pensions and 11.5 per cent received rental assistance. There is some income derived from investments with $737 on average coming from bank interest and $303 on average coming via imputation credits. Financial disadvantage is also evident in housing terms with 28 per cent of renters facing financial hardship and 16 per cent of home purchasers facing financial hardship. Not surprisingly, there is a high level of age dependency in Hervey Bay (36 per cent) and reflecting this there is a high level of home ownership (45.9 per cent).

SUMMARY

We have considered in this chapter the differences in advantage and disadvantage across the 119 places characterised as Australia’s large non-metropolitan cities, towns and regions. What this chapter illustrates is that socio-economic restructuring has resulted in mixed outcomes and differentiated impacts at the local level. Some places have indeed benefited from these changes and have been able to develop in a positive way. Others have developed negative outcomes which have included, relative to other places, low levels of labour-force participation, high unemployment rates and low incomes and high levels of household socio-economic disadvantage. Added to this are the problems often associated with declining social capital (Stone 2000) and other forms of social support which act to further disadvantage families and communities within places already struggling from negative economic outcomes. We have certainly noted in this chapter that several of the groups of localities had indicators that might suggest that declines in social support might be a problem, leading in some cases to multiple disadvantages.

The pattern of differentiated advantage and disadvantage across space is complex as well as uneven. It is interesting to note that population growth is a characteristic of both advantaged and disadvantaged places, so being a boom town in terms of population growth is not always associated with positive outcomes. The so-called sea-change localities, places such as Ballina and Hervey Bay (located in the welfare/retirement disadvantaged large non-metropolitan cities, towns and regions group), have high rates of population growth and some jobs growth, but they display relatively poor outcomes in terms of income, and in spite of a positive position in terms of job growth, they still have above average rates of unemployment. Then there are the boom regions such as Queanbeyan located in the tourism/population-boom advantaged localities which suggest the opposite outcomes – population and employment growth but also positive socio-economic performance. In this case a population boom might be seen in a more positive light, especially by local community leaders and politicians.

The impact of sectors such as mining and tourism and the important part that large service towns play is reflected in advantage at different levels. The importance of tourism reflects the impact of sunrise industries on positive regional outcomes as discussed by authors such as Beer, et al. (2003) and it reflects the ability of some places to rise on the changing economic tide through the development of these industry sectors and their support economies. The other extreme of regional economic restructuring is evident in some places of disadvantage with regions based on agricultural and manufacturing industries not performing well. The impact of restructuring in the agricultural sector has been well documented by authors such as Gray and Lawrence (2001) who note how the socio-economic outcomes have been less than positive. Manufacturing-based regions have also felt the negative impacts of restructuring, especially those where the economic base is built on old-economy manufacturing sectors. Some of these places have been single industry towns or places that had once prospered under early industry protection and have not been able to respond well to the economic changes occurring.

Table 4.9a Selected individual variables, large non-metropolitan cities, towns and regions
Source: 1 ABS Integrated Regional Data Base; 2 ABS CData 2001.

Table 4.9b Selected individual variables, large non-metropolitan cities, towns and regions (continued)
Source: 1 ABS Integrated Regional Data Base; 2 ABS CData 2001.

Table 4.9c Selected individual variables, large non-metropolitan cities, towns and regions (continued)
Source: 1 ABS Integrated Regional Data Base; 2 ABS CData 2001.

Table 4.9d Selected individual variables, large non-metropolitan cities, towns and regions (continued)
Source: 1 ABS Integrated Regional Data Base; 2 ABS CData 2001.

Table 4.9e Selected individual variables, large non-metropolitan cities, towns and regions (continued)
Source: 1 ABS Integrated Regional Data Base; 2 ABS CData 2001.

Table 4.9f Selected individual variables, large non-metropolitan cities, towns and regions (continued)
Source: 1 ABS Integrated Regional Data Base; 2 ABS CData 2001.

Table 4.9g Selected individual variables, large non-metropolitan cities, towns and regions (continued)
Source: 1 ABS Integrated Regional Data Base; 2 ABS CData 2001.

Table 4.9h Selected individual variables, large non-metropolitan cities, towns and regions (continued)
Source: 1 ABS Integrated Regional Data Base; 2 ABS CData 2001.

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Cite this chapter as: Baum, Scott; O’Connor, Kevin; Stimson, Robert. ‘Mining, tourism, sea-changers and agriculture’. Fault Lines Exposed. Melbourne: Monash University ePress; 2005. pp. 04.1–04.30.

 

Fault Lines Exposed: Advantage and Disadvantage Across Australia’s Settlement System

   by Scott Baum, Kevin O’Connor & Robert Stimson