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



Scott Baum
Kevin O’Connor
Robert Stimson

This chapter provides an overview of the main findings from the analysis and discussion presented in the book. It considers the broad picture of advantage and disadvantage and makes suggestions regarding the likely drivers of the patterns identified. The chapter also considers the policy issues that are associated with the patterns identified, and makes some suggestions regarding issues that policy makers should be considering.


In Australia, as well as in many other advanced nations, there has emerged a considerable debate about the social, economic and spatial impacts of the fundamental processes of change that have been occurring over the last few decades. As we discussed in Chapter One and two, of particular concern have been the effects of globalisation, economic restructuring, demographic and social changes, as well as associated political transformations and processes of social exclusion and disadvantage. This concern is felt at the level of individuals and households, and at a spatially disaggregated level by localities across the nation’s cities, towns and regions. It is this spatial perspective with which we have been concerned in this book. Questions have been asked about who have been the winners and who are the losers in the contemporary era of rapid and complex transformation occurring in our society as it has shifted from being an isolated, protected, industrial era to a more open global era of the service and information economy.

Of course these types of issues have been the focus of a considerable body of existing research. We saw in Chapter One that there has been a range of national level analyses regarding the processes of disadvantage and unequal social, economic and spatial outcomes (Australian Urban and Regional Development Review 1995; Gregory and Hunter 1995; Harding et al. 2002, 2004; Fincher and Wulff 1998; Mitchell and Carlson 2003; Mitchell and Bill 2004). Much of that type of research has concentrated on the same concerns as we do in this book. The focus of those studies has ranged from addressing questions of segregation, spatial inequality, disadvantage or social polarisation, to the now fashionably-labelled concept of social exclusion. While the semantics may differ, such studies have been concerned with pretty much the same general issues, including locating the impact of social and economic transitions within a given spatial and socio-economic context.

We also saw in Chapter One how the analyses presented in this book sit along side an earlier report released by the Australian Housing and Urban Research Institute (Baum et al. 1999) which focused on the decade 1986–1996, while this book focuses on the decade 1991–2001. It is therefore natural to ask how the two pieces of research have differed in their outcomes. Has there been any change in the patterns of advantage and disadvantage (or opportunity and vulnerability) across the settlement system? Have some localities been able to move up the ladder of advantage, and have others slipped? Prior to considering this, it should of course be noted that while the two pieces of analysis are similar in their general approaches, there are differences in the exact methodology used and the variables and indicators employed. This means that inevitably there is potentially some differences in the outcomes noted. However, a general comparison suggests that at the level of the typologies of localities developed in both pieces of research, there are similarities present. For example, in the extended metropolitan regions, both pieces of research identified groups of advantage localities associated with global economy functions, and both identified a set of gentrifying inner city localities. And there were equally similar groups of disadvantaged localities. Likewise in the non-metropolitan cities, towns and regions, similar groups of places were identified, with advantage being associated with mining and tourism and disadvantage being associated with agriculture, ‘old-economy’ employment and welfare and retirement migration.

Within the typologies it is natural to expect some shuffling of membership between categories of groups of advantaded and disadvantaged localities as the performance of some individual localities change. This may indicate a change in circumstance, but also it might be a product of the different approaches used. Although it is tempting to try to compare the movements of individual localities, it is important to realise that the clustering approaches used rely on statistical averages, and hence it might be possible that a particular locality represented by an SLA would be classified differently if a different technique or group of measures was employed. Setting up a ‘league table’ comparing the two analyses would need to be done with great caution, and for that reason we have not attempted such a direct comparison here.

These cautions aside, it is reasonable to suggest that what we have seen is that while there may have been some small changes, overall the picture of advantage and disadvantage across the settlement system of Australia has stayed relatively constant over the two study periods. This is not surprising since the types of changes needed to provide a significant shift in any one locality’s socio-economic position are likely to require a long lead time and will be influenced by what is happening on the national or regional level (the ‘rising tide lifting all boats’ metaphor may mean that a shift does not necessarily result in an improved relative position) and also by the substantial histories and inertia associated with any one place. Here we mean that disadvantage has developed – in a lot of cases – over a significant period of time, and as a result any significant change is going to take time to eventuate. In many cases, generational shifts may be necessarily to see an improvement, especially in some of the most disadvantaged areas.

One of the key statements taken from the introduction to this book is that there are real reasons to be concerned about the types of ‘fault lines’ identified and the processes that produce them. There are those who hold the view that inequality and increases in inequality are simply the dominant trend in the post-industrial knowledge era. We should of course resist such considerations. Economist Frank Stilwell (2002 p. 1) argues that ‘inequality has significant consequences for economic efficiency, social justice and environmental sustainability. Its sources are properly a central concern for political economic analysis. Its reduction is properly the concern for public policy’. Gaps between those places that are advantaged and those places that are disadvantaged do matter because they generally result in more negative outcomes for the disadvantaged places and the people that live there. This has been a theme of the recent book by Labour Opposition frontbencher Wayne Swan (2005). His view is that the result of growing spatial inequality in Australian society is a greater separation between rich and poor. In particular he is concerned about the problems that exist when:


income, employment and economic growth vary by postcodes. As the wealthy take over real estate close to good jobs, the best schools and hospitals they lift the cost of entry to those areas. On the other hand, as the splintering middle and poorer people move further away they are paying more to get to work, school and see the doctor. If they lose their job, distance compounds their disadvantage (Swan 2005 p. 172).

So reflecting on the findings in this book, and taking Wayne Swan’s comments into account, we should be concerned – among other things – that there are whole groups of places across Australia’s cities, towns and regions where the people earn a large proportion of their income from government transfers; and there are places where there are significant proportions of young people out of work, often effectively completing a declining cycle of intergenerational poverty and disadvantage. These problems affect metropolitan regions as much as they affect non-metropolitan cities, towns and regions. In the words of the Organisation for Economic Co-operation and Development (1998 p. 11) these disadvantaged localities do ‘limit the opportunities and prospects of people who live in them, but they also limit the ability of a nation and society to realise the inherent possibilities that exist in these places’. These are problems both in metropolitan locations and in non-metropolitan cities, towns and regions.


The analyses conducted and discussed in Chapters three through six identifying groupings of localities across the four categories of Australia’s settlement system reveal that the total number of SLAs that have been identified as exhibiting advantage is 282 in which almost two-fifths of the nation’s population were living in 2001, while the incidence of SLAs that have been identified as exhibiting disadvantage is 509 SLAs in which a little over three-fifths of the nation’s population were living. These aggregate figures should be cause for concern, but it is instructive to look more deeply at the figures set out in Table 7.1 and what they tell us about the overall pattern of distribution of advantaged and disadvantaged places across the settlement system.

Advantage is most strongly concentrated in absolute terms in the SLAs within the extended metropolitan regions, which is not surprising given the fact that about 70 per cent of the nation’s population live there. Advantaged SLAs in these extended metropolitan regions are are home to approximately one-quarter of the nation’s population, but within those regions less than two-fifths of the people living there are in SLAs that are designated as having advantage. In the large non-metropolitan cities, towns and regions, where about 21 per cent of the nation’s people live, almost 42 per cent of those 4 million people live in SLAs that are designated as advantaged places, and those 42 SLAs contain about 9 per cent of the nation’s population. Across the small non-metropolitan towns and regions, in which fewer than four per cent of the nation’s population live, there are only 30 out of 126 SLAs that are designated as advantaged places, but those SLAs represent less than one per cent of the nation’s population. Within the small non-metropolitan cities, towns and regions, the 30 advantaged SLAs are home to only one-quarter of the 658,000 people living in that component of Australia’s settlement system. Finally, within the 258 SLAs comprising the non-metropolitan rural towns and regions where 1.25 million people (or under 7 per cent of the nation’s population) live, there are 95 SLAs that are designated as advantaged places. Within these non-metropolitan rural towns and regions, about one-third of the people live in advantaged places.

Thus, the pattern of distribution of advantage across Australia’s settlement system, and the incidence of advantage within the four components of the settlement system, is such that we see a marked decrease in the relative incidence of advantage in the small non-metropolitan cities, towns and regions in particular and also in the non-metropolitan rural towns and regions compared to other parts of the settlement system. But an interesting finding is that the relative incidence of advantaged localities is greater within the large non-metropolitan cities, towns and regions than it is within the localities comprising the extended metropolitan regions.

Turning to the magnitude of occurrence and the distribution of the incidence of disadvantage across the nation’s settlement system, it is evident that the smaller towns and rural places have the greater relative incidence and concentration of disadvantage, while it is the larger non-metropolitan regional cities, towns and regions, and especially the extended metropolitan regions, where by far the greatest absolute incidence of people live in SLAs that are designated as being disadvantaged.

The data in Table 7.1 shows that within the extended metropolitan regions 117 of the 301 SLAs analysed are designated as being disadvantaged, and these are places where over two-fifths of the nation’s people lived at the 2001 census. Within the extended metropolitan regions, those disadvantaged SLAs account for over 62 per cent of the population of this component of the settlement system. In the large non-metropolitan cities, towns and regions there are 67 out of 119 SLAs included in the analysis that are designated as being disadvantaged, and these places are home to about 58 per cent of the population of this component of the settlement system, or about 12 per cent of the nation’s population. The small non-metropolitan cities, towns and regions are where the incidence of people living in places that are designated as disadvantaged increases, with 96 of the 126 SLAs being disadvantaged places, and these are where over three-quarters of the 858,000 people living in this component of the settlement system lived in 2001, but they represent just 2.6 per cent of Australia’s population.

Finally, in the non-metropolitan rural towns and regions, 162 of the 248 SLAs analysed are designated as being disadvantaged, and these are places where about 840,000 people live, representing 4.3 per cent of Australia’s population. Within this component of the settlement system two-thirds of people live in those disadvantaged SLAs.

As we have discussed in detail in Chapters three through six there is a complex mosaic of patterns of advantage and disadvantage within the components of the settlement system, and the spatial extent of the various groupings of advantaged and disadvantaged localities – as identified by the multi-variate statistical modelling to derive the typologies – have been shown to have quite distinct socio-economic and demographic characteristics.

Across Australia the greatest concentration of people living in 2001 in an advantaged group is the 49 SLAs comprising the advantaged middle-class suburban localities in the extended metropolitan regions where over 2.4 million people live, which represents over 12 per cent of the nation’s population. It is also the extended metropolitan regions where the most pervasive disadvantage group, comprising 66 SLAs identified as the battling family/mortgage-stress disadvantaged locations, is found. These SLAs are where 4 million people or about 21 per cent of the nation’s population live. In the large non-metropolitan cities, towns and regions the greatest concentration of people living in an advantaged group of SLAs comprising the 31 SLAs that are identified as the service-based advantaged non-metropolitan cities, towns and regions where about 340,000 people live, representing 6.3 per cent of the nation’s population. A further 7.2 per cent of the nation’s population, or 1.4 million people, live in the 24 SLAs comprising the employment disadvantaged large non-metropolitan cities, towns and regions, which is the disadvantaged group of localities that are most numerous and which have the highest concentration of people within this category of the settlement system.

Within the small non-metropolitan cities, towns and regions about 102,000 people, or just 0.5 per cent of the nation’s population live in the 19 SLAs that comprise the largest group of advantaged localities, and these are designated as the population-growth advantaged small non-metropolitan cities, towns and regions. But over 345,000 people, or 1.8 per cent of the nation’s population, live in the population-stagnant/employment disadvantaged small non-metropolitan cities, towns and regions which is formed by 58 SLAs and where the greatest concentration of disadvantage is evident in this category of the settlement system. And finally in the non-metropolitan rural towns and regions component of the settlement system, almost 302,000 people (1.6 per cent of the nation’s population) live in the 61 SLAs comprising the income advantaged non-metropolitan rural towns and regions group, which is the greatest concentration of advantage in this category of the settlement system. But almost 354,000 people, or 1.8 per cent of the nation’s population, live in the 70 SLAs that comprise the agricultural-based disadvantaged non-metropolitan rural towns and regions (1) group, which comprises those places with the greatest concentration of people living in an advantaged grouping in this category of the settlement system.

If one is to focus on those localities in Australia which are exhibiting the greatest level of advantage we find that relatively few people live in those groupings of SLAs thus designated, and the actual number of SLAs included is not great. For example, within the extended metropolitan regions there are just 31 SLAs where a little over one million people (or just 5.5 per cent of the nation’s population) lived in 2001. These are identified as the new-economy extremely advantaged group of SLAs. Within the large non-metropolitan cities, towns and regions component of the settlement system, there are only 8 SLAs that comprise the most advantaged group that is designated as the income-advantaged mining large non-metropolitan cities, towns and regions advantaged group. But only 137,000 people were living in these places in 2001, representing less than one per cent of Australia’s population. Within the small non-metropolitan cities, towns and regions there is similarly a small group of just 11 SLAs that form the most advantaged group of localities, and this group is designated the income/employment advantaged small non-metropolitan towns and cities advantaged group of localities. But fewer than 57,000 people lived in these places in 2001, representing only 0.3 per cent of the nation’s population. Finally, in the non-metropolitan rural towns and regions, the group of 35 SLAs that form the most advantaged group designated the income/employment advantaged non-metropolitan rural towns and regions had fewer than 114,000 people in 2001, only 0.6 per cent of Australia’s population.

Thus, across the four components of the settlement system the top performing groups of advantaged SLAs collectively number only 85 SLAs, which were the home in 2001 to just under 1.4 million people, or only 7.1 per cent of the Australia’s population. In policy terms it is important to know more about what it is that makes these places such strong performing localities creating high levels of advantage for the people who live there. And it would be useful to ascertain if there are policy levers that might be used to help ‘spread’ that advantage effect.

But from a policy perspective what is perhaps the most important issue to arise out of the analysis conducted and the discussion presented in Chapters three through six is the incidence of the most severe forms of community disadvantage across Australia’s settlement system. As the data in Table 7.1 shows, the number of people at the 2001 Census living in that grouping of most disadvantaged SLAs within each of the four categories of the settlement system we have analysed in this book collectively number over five million, which is approaching one-fifth of the nation’s population. There is a total of 293 SLAs across the nation that fall within the groupings of disadvantage which we suggest represent a degree of disadvantage which should be of considerable concern for society in the context of sustainable and competitive economic and social performance. Perhaps it is these localities, represented by those 293 SLAs, which might be the focus for policy and program intervention in terms of the people-based and place-based policy approaches discussed in the sections of this chapter to follow.

What are these groups of significant disadvantage?

Within the extended metropolitan regions there are two particular groupings of disadvantaged SLAs that are of concern. There are first the 37 SLAs with 1.8 million people (9.3 per cent of the nation’s population) that are designated as old-economy extremely disadvantaged group of localities, and second there are the 35 SLAs with about half a million people (2.8 per cent of the nation’s population) that are designated the group of peri-urban disadvantaged localities. Within the extended metropolitan regions these two groups account for just over 18 per cent of the people living in this component of Australia’s settlement system. Across the large non-metropolitan cities, towns and regions, two groups of particular disadvantage stand out. The first is the 24 SLAs with 1.4 million people (7.2 per cent of the nation’s population) that is designated as the employment disadvantaged group of large non-metropolitan cities, towns and regions. The second is the group of 21 SLAs comprising the welfare/retirement disadvantaged large non-metropolitan cities, towns and regions where about 500,000 people lived in 2001, representing 2.5 per cent of the nation’s population. These places are largely old industrial towns and rapidly growing coastal towns which exhibiting very different socio-economic disadvantage characteristics and would requiring very different policy approaches. Within the small non-metropolitan cities, towns and regions the most disadvantaged places are in the group of 58 SLAs forming the population-stagnant/employment disadvantaged small non-metropolitan cities, towns and regions, where over 345,000 people live, representing 1.8 per cent of the nation’s population. Finally, across the non-metropolitan rural towns and regions there are two groupings of agricultural-based disadvantaged localities, comprising collectively 118 SLAs where over 465,000 people live, representing 1.4 per cent of the nation’s population.

Further research is needed to fully explore the characteristics of three groupings of localities of significant disadvantage across Australia’s settlement system, and the discussion that follows might provide a useful context in which to pursue that.


Table 7.1a Population distribution across the Advantaged and Disadvantaged groupings of SLAs by categories in the National settlement System, 2001


Table 7.1b Population distribution across the Advantaged and Disadvantaged groupings of SLAs by categories in the National settlement System, 2001 (continued)


Table 7.1c Population distribution across the Advantaged and Disadvantaged groupings of SLAs by categories in the National settlement System, 2001 (continued)


In this chapter we want to consider the bigger picture that has come out of the discussion and analyses presented in Chapters three through six, and we want to present some pointers to guide possible policy reactions to those findings. The policy discussion is purely for the purpose of encouraging continuing debate on policy considerations. We emphasise that the discussion contained in the latter part of this chapter should not be construed as constituting proposals for policy implementation; indeed, much more detailed community-specific analyses are needed before a prescriptive approach to policy is contemplated.

Firstly, we want to take a ‘big picture’ view of the outcomes presented in this book by considering what might be a set of key drivers associated with the outcomes. Considering the patterns across the metropolitan cities and the non-metropolitan cities, towns and regions, it is without doubt that a large part of the differentiation between places in their performance is explained by economic outcomes. Differences in rates of engagement and disengagement from the labour market appear to be a key driver. Indeed, as argued by Bill Mitchell and John Burgess:


Unemployment remains one of the most apparent forms of social and economic exclusion in our community. Without a job you are dependent on transfers and savings to survive. You are also stigmatised and you are also likely to be located in poverty and you are also more likely to be subject to health, family break-up and other social problems… The unemployed have few rights, indeed they are a group who can be easily stereotyped and condemned by anecdote (Mitchell and Burgess (1999 p.1).

Levels of human capital, and the industry and occupation structure as it relates to the transition from the Fordist industrial era to the post-Fordist services and information economy, are tied into this, as is the ability of localities – especially those in non-metropolitan Australia – to tap into particular economic activities including the group of sunrise or emerging industries (Beer et al. 2003). These outcomes are, in turn, associated with the level of monetary resources available to individuals, and at an aggregate level in localities, cities, towns and regions. And they are also associated with various other social and demographic outcomes. The social processes that are sometimes associated with single-parent families and non-earner families – including a lack of strong social capital or weak social networks – act to further reinforce disadvantage associated with labour markets. We have also suggested that space and location are important. In situations where disadvantage is spatially concentrated, the impact of multiple disadvantages may act to further exacerbate negative outcomes through the influence of what are fashionably referred to as neighbourhood effects. These outcomes were highlighted in the introductory chapters to this book, and it is not too difficult to make this connection with the material presented in the main analytical chapters. These points do, of course, begin to indicate some of the possible policy issues and the directions that perhaps could be taken.

A big picture view also suggests that there exists a complex geography of advantage and disadvantage across Australia’s settlement system. Beginning at the top with the metropolitan regions, the two public service cities (Canberra and Darwin), together with the nation’s global city Sydney, are doing well. Sydney in particular has for sometime been viewed as having ‘pulled away’ from the rest of the country, as its role as the nation’s ‘global city’ has meant that in broad terms it is doing better than most other places. It is after all the Australian mega-city. As Journalist Diana Bagnall puts it: ‘welcome to Sydney… restyled as Australia’s principal centre as a Global City… It is pretty much the centre of the universe as far as Australia goes’ (Bagnall 1999 p. 53). Across the board it seems that Sydney’s SLAs are performing at higher levels in terms of socio-economic outcomes. It is certainly the case that Sydney (and one would suspect that the same applies to Canberra and Darwin) has disadvantaged places, and the reference in Chapter One to the social unrest and disadvantage in the community of Macquarie Fields should alert us to this. But comparatively, the outcomes in these disadvantaged localities in Sydney are not quite as bad as they are in other big cities. Then there is Melbourne. Often called the bridesmaid to the success of Sydney, the competition between the two cities is legendary; but in terms of advantage and disadvantage, Melbourne appears to have an even mix of both advantage and disadvantage. Brisbane and Perth – the two sun-belt capitals – might one day in the distant future challenge the other two major cities in terms of being the country’s population capitals (they already have higher population growth rates). They too have their fair share of winners and losers, with Perth perhaps slightly more advantaged than Brisbane by virtue of its greater links to the global economy via close ties with global mining and geographically with South East Asia. Clearly heading up the tail are the two smallest state capitals, Adelaide and Hobart. Sometimes referred to as the rust-belt capitals these two cities are doing it hard no matter what way you slice the socio-economic pie. Adelaide in particular has become almost legendary in terms of its disadvantage, a point made by Bulletin journalist Patrick Carlyon (2003 p. 52) who argues that ‘South Australia has spent the past decade hurtling towards economic irrelevance’ a fact that has been reflected in a range of negative socio-economic outcomes.

Outside of the capital cities we are faced with a broad collection of cities, towns and regions, some highly urban while others are small settlements within a larger sparsely populated region. Clearly, despite talk about disadvantage in regional areas relative to metropolitan areas and the concern about the rural crisis (Gray and Lawrence 2001; Lockie and Bourke 2001), not all is bad in non-metropolitan Australia. What is encouraging from our analysis is that there is a considerable amount of advantage that exists across inland localities throughout most of the states and territories. The strength of many of the traditional service centres is something that may have been played down in the past, particularly in light of media coverage and political rhetoric about the severe plight of regional Australia. But as we have illustrated here advantage is associated with service-based cities and towns and with those places contained by their hinterlands. In addition advantage is also related to mining and tourism and to some extent the existence of new sun-rise industries has also lead to advantage (Beer et al. 2003).

A particularly important finding from the analysis of non-metropolitan Australia is the high concentration of disadvantage associated with welfare and retirement migration in many large regional cities and towns and also in some smaller rural areas. We have emphasised how this finding reinforces the notion that population growth will not necessarily create great opportunity in terms of the successful integration of localities, cities, towns and regions into the ‘new economy’. The migration-led population shifts occurring in regional Australia are creating a significant amount of new urban spaces – particularly in coastal ‘sun belt’ regions – that could be thought of as ‘welfare traps’. Large amounts of government expenditure are currently targeted at these areas and it is likely that this assistance will be needed into the future. The clear pattern of disadvantage associated with declining agricultural areas and ‘old economy’ manufacturing industries is a further aspect of the economic geography of non-metropolitan cities, towns and regions. These are the places that in some sense have lost the most as changing economic fortunes have reshaped regional economies and societies. They are the places that political discourse has focused on and the media has had a particular interest in.


We have already discussed the reasons why we need to be concerned about the uneven outcomes we have identified in this book. It is now appropriate to consider something about policy outcomes. How should we begin to think about the inequalities we have identified and what input can we make in terms of policy questions and approaches?

It should come of no surprise that there exists a large body of literature that contributes to an understanding of possible policy questions and approaches. Some of the various studies already mentioned in this book contain highly useful and relevant contributions. We have outlined a broad range of possible policy approaches for metropolitan regions elsewhere (O’Connor et al. 2001; O’Connor and Healy 2004) and others have made similar contributions in terms of regional, non-metropolitan policy (Beer et al. 2003; Collits 2004; Maude 2004).

Among other things, the concerns in metropolitan Australia focus on how best to deal with seriously entrenched disadvantage, like we have identified in the group of old economy extremely disadvantaged localities. One approach has been to invoke the use of social mix, whereby mixing of people in a given space on the basis of diverse or different social classes or socioeconomic statuses, social categories, stages in their life cycles; or household or family types is attempted so as to overcome – among other things – so-called concentration effects (see Arthurson 2002; Johnston 2002). Often it is considered that diversifying tenure, leading to a greater social mix, will remedy problems associated with the concentration of disadvantage, and while this has been a part of the operational management plans of a number of state government housing authorities (Wood 2002), many have questioned such policies to create ‘inclusive, cohesive and sustainable communities’ (Arthurson 2002 p. 258). While approaches such as these have to do with strengthening social capital, others have recognised that the root cause of the problems of unequal socio-economic outcomes and concentrated disadvantage across cities and regions has to do with a lack of jobs. Here some form of job creation mechanism is required, with some arguing that the right way of doing this is through the establishment of a job guarantee by governments (Mitchell and Burgess 1999; Mitchell et al. 2000; Mitchell 2002). The process of the job guarantee has been widely discussed by the University of Newcastle’s Bill Mitchell. Essentially it involves:


The government continuously absorbing into employment workers displaced from the private sector. The Job Guarantee employees would be paid the minimum wage, which defines a wage floor for the economy. Government employment and spending automatically increases (decreases) as jobs are lost (gained) in the private sector. The Job Guarantee model allows currently idle workers to contribute in many socially useful activities including urban renewal projects and other environmental and construction schemes (reforestation, sand dune stabilisation, river valley erosion control, and the like), personal assistance to pensioners, and assistance in community sports schemes (Mitchell et al. 2000 p. 28).

Others identify that the lack of jobs in a given area is a problem, but that the solution is to concentrate on the complex links between housing and job location in the wider metropolitan development process (Randolph 1991; Healy and O’Connor 2001; Moriarty 2002; O’Connor and Healy 2004). As an example, Healy and O’Connor (2001) argue that:


… in the long term it is likely that more sustainable and equitable outcomes in terms of economic development in the metropolitan area will involve attention to job growth and community facilities in the middle and outer suburbs (p. 15).

This might suggest that questions of sustainable social outcomes in metropolitan regions can be addressed through more effective suburban management and interactions that encourage stronger sub-regional links between jobs and housing growth.

Across the non-metropolitan regions of Australia, policy concerns have usually been focused on how best to overcome the so-called rural crisis, how to promote positive regional outcomes in the face of a deregulated marketplace and how to give regional Australia the boost it needs to overcome disadvantage. The view is often how governments can work better, but there is also some discussion on the ability of local regional or rural communities to help themselves. The piece by Paul Collits (2004) in the European Planning Studies journal provides a good insight into the policy issues facing governments at all levels, but also recognises the role that local communities can play. In his conclusion, Collits argues that:


The future of regional Australia must be built on competitive business, diverse and sustainable industries and open, welcoming communities. Government must continue to be a willing partner in the enterprise, not as the sole driver of regional development but as an active and focused facilitator. Communities and regions will succeed where they are willing to welcome change, where they provide a positive investment climate, where they are vigilant, where they are constantly open to the need for re-invention, and where they have realistic and achievable goals (p. 95).

In a similar vein, Australian Productivity Commission Chairman Gary Banks (2000 p. 11) argues that ‘it is only by focusing on the fundamentals that governments can make a sustainable contribution to regional development’. They should ‘work on a region’s potential for development, not on development itself’.

The types of drivers that might help overcome regional disadvantage might include a focus on industry clusters and business incubators as a means of promoting regional development (Stimson et al. 2002; Beer et al. 2003) together with other means of harnessing opportunity that take advantage of a locality’s comparative advantage. As far as the role that local communities can play Stewart Lockie in the concluding chapter to the book Rurality Bites suggests that:


There are plenty of examples of rural Australians taking positive steps to ensure a positive future for themselves and for others. Examples raised in this book include the rural women’s movement and its promotion of women as full and equal partners in farm business; the development of regional agreements between traditional owners and other rural land users to ensure that everybody’s interests in land are protected; community Landcare groups with their unique ability to generate openness, understanding and coordinated action among land users; and rural communities who have worked to address suicide, economic decline and youth issues (Lockie 2001 pp. 287–288).

A similar picture has been painted by the edited book by Cocklin and Alston (2003).

Clearly this brief interlude into various policy arguments and solutions is only the tip of the iceberg, but it does serve the purpose of reminding us that possible solutions are likely to come from a combination of possibilities and that to a large extent one size fits all policy options most likely will not work.

Many of these existing arguments for what might or might not work in addressing unequal outcomes across the settlement system tend to take a very specific focus. The contribution we want to make is a more general focus that looks at what might be termed place prosperity and people prosperity.

Certainly our research has found a distinctive geography in recent social and economic change occurring across Australia’s cities, towns and regions. The geographical dimension can lead to a concentration on place as a framework for policy response. It would seem that many of the localities identified as being disadvantaged might appear to be legitimate targets for place-specific policy programs by various levels of government. At the same time the analysis has exposed the significance of what can be called people-based dimensions of community development such as the advancement and strengthening of local human capital.

It is, of course, difficult to precisely differentiate between place and people-related variables, as some might legitimately argue that where one lives affects what one does. Thus, for example, it is not necessarily clear-cut that variables including working in a particular industry or experiencing housing financial stress is a product of the person per se or of the place per se; rather, it is probably some mixture of the two.

Nonetheless, the distinction between the place-related and people-related perspectives on social and economic change has had a long heritage in urban and regional analysis and policy, and has been associated with different traditions that focus upon places or upon people in the application of social and economic assistance. In public policy analysis this involves a contrast between what has been called place prosperity and people prosperity.

The focus on place prosperity involves dealing directly with places when policy is designed and implemented. This can be seen in policy implemented in many parts of the world that use regional assistance – often scaled in terms of locational attributes – providing higher levels of funding in locations with a higher or lower incidence of specific phenomenon, such as higher levels of unemployment.

There has been a long tradition of such place-related policies in Australia, including, for example:


  • differential spatial/regional weightings in financial allocations through the various grants commissions at the commonwealth and state levels
  • state government industry-decentralisation programs
  • the construction of public-housing estates in specific suburbs and towns by state housing authorities
  • the building of new towns
  • the targeting of regional growth centres
  • inner-city urban renewal projects such as Darling Harbour in Sydney and Docklands in Melbourne
  • the Better Cities Program in the early 1990s involving Commonwealth, state and local governments.

This concern with place has often been well justified in a past era of relatively low levels of day-to-day mobility as well as lower levels of residential mobility and inter-regional migration, an era when there was a particularly strong sense of belonging and identity in localities. This is not to say that place identity and localism are still not values held highly and dearly by many people in the contemporary era, but rather the increasing mobility in society raises questions about its universality. However, the working-class suburbs of parts of the metropolitan regions, along with places associated with both large and small urban centres in regional Australia, provide good examples of the persistence of strong place identity.

The policy frameworks created around place prosperity also had a strong justification in political terms when spatial units and the political process could be associated through spatial patterns of expenditure on places. This is seen at its best – or some would say at its worst – in the classic place-specific project pork-barrelling embraced by politicians of all party persuasions, and in particular in its association with the electoral cycle.

In contrast, people prosperity is associated with economic and social policies that influence the social and economic fortunes of people, irrespective of where they live. Taxation, with its often regressive structure, is perhaps the best example. But a common feature of people-focused policy is the use of eligibility criteria, usually related to criteria such as level of income and/or assets, state of health or other well-being, age, and so on. This policy focus underpins much of the distribution of transfer payments to eligible and often disadvantaged persons.

But people-focused policy is also very common in Australia. It has included, for example the following:


  • aged pensions
  • subsidies for attending educational institutions
  • unemployment benefits
  • disability benefits
  • labour-force skills training programs
  • housing rental assistance
  • home ownership assistance schemes.

In recent years the creation of social policy that allows individuals to make their own choices in terms of services like education and rental housing provides examples of people-focused assistance programs.

Thus, for example, rather than providing public funding for capital expenditure in public housing at fixed locations, the Commonwealth and the states provide eligible low-income households with a housing rental subsidy. This subsidy can be used to rent a house where the recipient so chooses, within of course, the constraints of significant spatial and other variations in housing market costs. The people-focus on assistance programs is also seen in recent new actions by the Commonwealth Government on the payment of unemployment benefits which discourages relocation away from job opportunities.

In the analyses presented in this book, it has appeared that dimensions of people prosperity were especially prominent as drivers of advantage and disadvantage at the level of metropolitan localities as well as non-metropolitan and rural cities, towns and regions. In particular, it seemed that in the ability to engage in new-economy type activities, the level of human capital and incomes is a key factor. This might suggest that assistance that helps people to participate in some of the emerging industry sectors and occupations of the ‘new economy’ could be an effective policy action. If that approach was followed, funding for urban regeneration in disadvantaged areas might appear as a lower priority than, say, a suite of policy actions designed to encourage training and occupational change and also to assist the relocation of people from localities with poor labour market engagement prospects to localities of better and more diversified labour market engagement options. However, it should be noted that the relocation of people from job-poor to job-rich localities may only offer a piece-meal solution as the potential for re-engagement into the labour-market may be low. Thus the notion of relocation should not be regarded as a panacea approach in policy formation. The big issue thus becomes the degree to which job generation can occur through local regional economic development in those disadvantaged places.

Although the foregoing suggests that there may be some advantage in reconsidering the past focus on place-based policies, it is never-the-less also important to remember that place is still a powerful determinant of social and economic outcomes. This can be seen in the differences between individual metropolitan city regions, as well as through the geographical concentration of disadvantaged localities, both within the extended metropolitan city regions and across the regional cities and towns. These include, for example, the outer industrial suburbs developed in the 1950s, the ‘old economy’ single-industry regional cities and towns, and the coastal urban centres with growing populations. The prominence of these geographic concentrations of many of the groups of disadvantage reflects the fact that the growth industries and the growth occupations that play a role in shaping people prosperity have a distinctive geography themselves in the post-Fordist era of globalisation. It is clear from our analyses that some places have developed people prosperity better than others. That is seen, for example, in the transformation of the inner-city suburbs, the location of specific remote-area extractive-based towns, and the regional tourism-based cities, towns and regions of advantage.

This means that engagement within the modern economy, which plays such a fundamental and significant role as a discriminator in understanding advantage and disadvantage, is itself a geographic variable. That is why, for example, in a broad sense, the disadvantaged areas of Sydney appear to be ‘better-off’ than the disadvantaged localities of Adelaide. In simple terms, there is greater overall advantage available in the Sydney metropolitan region because of its role as the nation’s global city.

This outcome is complicated by other factors such as the operation of the housing market, which generally produces expensive housing in places with many jobs and low-cost housing in places with few jobs. This is seen in part at the aggregate level of scale in the considerable variations that exist between the metropolitan cities in their median house and unit costs. Here Sydney is the clear leader with the highest housing costs, and Adelaide and Hobart are behind with lower costs. But there are even starker spatial variations in housing prices within the metropolitan city regions, where generally the inner-city and middle suburban areas, which are more likely to be localities of advantage, have much higher housing costs than the outer suburbs, many of which are disadvantaged.

In relation to marked spatial variations in housing costs, an individual equipped with a people-prosperity-enhancing rental assistance grant may have to locate in a place that offers little advantage. And a low-income household not eligible for housing assistance will have its feasible housing location choice spatially constrained to those lower-cost housing areas. It is thus not surprising that we have seen the emergence of places that have been referred to as welfare traps for low-income households, and in particular for those dependent on transfer payments, such as retirees and the unemployed. The stark spatial variations in housing prices across Australia’s cities and towns might be considered to be an important factor in the phenomenon of inter-regional migration involving retirees, the unemployed and the marginally employed to coastal towns and some smaller towns in the inland parts of regional Australia. As well, it helps explain the concentration of some of the groups of disadvantage in the outer suburban and peri-urban regions of the metropolitan cities where land and housing costs are relatively cheap.

It is for reasons such as those discussed above that a people-prosperity policy will not be effective unless there is some hope for people to reach out to, and become engaged in, those emerging parts of the economy that have global and national linkages. That means that a mixed people-place policy is needed, but probably not including all places.

There is, of course, a difficulty in deciding the mix of people and place policies. In effect, policy actions need to address those places that are best equipped to enable people to participate in a range of economic activity choices.

The difficulty in deciding the balance between people and place prosperity in public policy areas such as housing and social services can be seen in the locations of rapid population growth across Australia. Population growth can generate effective outcomes when it is associated with new economic activity that provides employment. This is seen, for example, in regional locations such as Cairns in far north Queensland and in some middle and outer suburbs that are accessible to jobs in a metropolitan city region. But in many growth locations – and especially on the fringe of the metropolitan city regions and in coastal locations that are away from the major cities – engagement with the new-economy is difficult. It is these places where disadvantage may be generated by the voluntary in-movement of population, often involving individuals and households seeking cheaper housing. These locations could emerge as welfare traps if jobs development cannot be facilitated, and that outcome will be exacerbated as young people come into the labour market. It is possible that geographic concentrations of youth unemployment could be a serious problem – perhaps even more so than it is already – as the children of current in-movers reach the workforce age, a problem that may well be aggravated by similar concentrations of families with no employed parent. We already see evidence of this in localities such as Elizabeth in Adelaide’s outer suburbs and Ipswich in Brisbane.

The outcomes could have serious long term consequences for Commonwealth and state government welfare budgets as the pressure on services expands. Hence, before embarking on any effort to foster urban regeneration in particular locations, some regional development initiatives may need to be implemented.

The outcomes of advantage and disadvantage displayed in our analyses show that many of the large regional cities and towns have sought to provide opportunities for their populations; although it is important to note that the economic success of many of these localities is associated with government funded service provision, and particularly in the form of education, health, administration and other public services. These involve all levels of government, but in particular the states and the Commonwealth. The long-term vitality of these activities may be questionable given the shift that has been occurring to privatisation and outsourcing.

However, the problems of the smaller regional towns mean that overall many of them have little to offer people as a place to work and even to live. Obviously engagement with the industries and occupations of the ‘new economy’ is difficult for the smaller towns, even if some of these places have begun to grow, or the decline in their populations has been arrested, as a result of the in-movement of people receiving welfare support and seeking low-cost housing. While a few places might be benefiting from the in-movement of telecommuting professionals, this is hardly enough to revitalise many localities. Unless there are opportunities in the local or regional setting, the benefits that the people-focused policies could bring (through welfare expenditure) will not extend beyond simple local consumption.

For a long time the isolated and remote towns and regions have been seen as vulnerable, and for many decades they have been places that have attracted a lot of attention in terms of assistance policies. They provide a special insight into the issues discussed above. The results of our analyses show, however, that the mining and tourism centres in isolated and remote locations are not disadvantaged in the sense used in this book, although some of the old ones (such as Broken Hill) are vulnerable. This result illustrates a special labour market where workforce engagement is closely linked to population movements. Many who move to these locations – places such as Port Hedland and Cairns – do so in response to employment opportunities, sometimes in high-paying and skilled activities, especially in the mining towns.

In these places, the economy is matched to its local labour supply, something that is difficult to achieve in many other large and small regional towns. It is also difficult to maintain, especially if the mineral industry begins to crumble as is happening in some of the older centres. The use of fly-in-fly-out operations in the mining industry will also reduce the relevance of this type of settlement in Australia. In the meantime, it provides an interesting illustration of local labour market outcomes.

In some respects, the plight of much of rural and small town regional Australia might be seen today as the inevitable outcome of decades of on-going and cumulative processes population decline, and the loss of jobs and the destruction of the economic base of some of those places. That has led to the current situation in many parts of rural and regional Australia – a situation which will continue to get worse – whereby those regions which can no longer sustain the number, size and diversity of urban places that once prospered. But it is not all ‘doom and gloom’ for many of the people still productively engaged in the diverse range of incredibly proficient and efficient export-oriented agricultural, pastoral and mining activities which characterise many of the nation’s rural regions. The reality is that many of these rural regions – some of which are in remote locations – and some of the people living and working there are doing very well; but the substitution of capital for labour, and the corporatisation of globally-linked production processes means that few people and few urban settlements are needed to sustain the remarkable generation of wealth that is occurring from the high productivity industries in these places. Perhaps it is now time that policy interventions in appropriate places should become more oriented to enabling those remaining who are disengaged from those productive processes and are thus disadvantaged to voluntarily choose to participate in subsidised relocation to other places where they may be better able to engage in work and access the urban-based services they need.


The analyses carried out and reported in this book provide an useful but challenging perspective on the spatial patterns associated with social and economic transformations occurring across Australia’s cities, towns and regions and the ‘fault lines’ that have emerged. In turn, interpretations of those patterns and divides and the diversity of advantage and disadvantage that exists, might help sharpen thinking about the focus of both traditional and recent policy action and the mix of both people-focused and place-focused policy interventions that might be appropriate. Clear thinking about the latter is essential to achieve the most effective outcomes of policy actions. Perhaps the most important finding from the research to date is that not all places can provide a mix of place and people dimensions that are critical for a community to overcome its disadvantaged position. That means the policy mix might need to be varied from place to place. Being better informed about those places provides a major research challenge with a significant potential contribution to policy implementation.


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Cite this chapter as: Baum, Scott; O’Connor, Kevin; Stimson, Robert. ‘Broad outcomes and policy issues’. Fault Lines Exposed. Melbourne: Monash University ePress; 2005. pp. 07.1–07.20.


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

   by Scott Baum, Kevin O’Connor & Robert Stimson