This paper examines the economic status of Indigenous Australians as a self-identifying group. It is an early version of an entry to the 2nd edition of the Encyclopedia of the Australian People, to be published in 2001. Indigenous Australians today face a diversity of economic circumstances. At one end of a spectrum are those residing in urban settings and engaging with the market economy, with varying degrees of success, like other Australians. At the other end are those who reside in remote parts of Australia and maintain important aspects of the Indigenous economy. Despite this heterogeneity, the vast majority of Indigenous people (73 per cent) reside either in towns or in cities, with the remaining 27 per cent residing in small Indigenous towns (so defined because the majority of the population is Indigenous), on pastoral stations or at outstations. It can be argued that nowhere are the differences between Indigenous institutions and those of the colonisers of Australia more marked than in the economic system.

Measures of economic status are primarily statistical and based on the social indicator approach. The social indicators utilised in this paper provide data that differentiates Indigenous from non-Indigenous Australians in relation to employment, income, housing, education and health status. These measures of wellbeing show that, as a group, Indigenous people have the lowest economic status of all Australians, without any qualification.

A broadly related set of factors can explain Indigenous economic marginality: historical exclusion from the mainstream provisions of the Australian welfare state and associated legacies; structural factors such as population structure and location of residence; cultural factors such as differing priorities and absence of labour migration; and demand side issues such as discrimination. The variable interplay of all these factors explains in large part the diversity of circumstances of Indigenous Australians today.

Policy and program responses

It is well established that Indigenous people are the most marginal group in Australian society. Addressing this issue and making progress in both a real and in a statistical, measurable sense has proven very difficult, despite concerted government attention and allocation of considerable resources. Government policies in the last 30 years have remained fundamentally ‘assimilationist’. It has been assumed that if sufficient public funds were devoted to Indigenous education, health, housing and employment programs, then material betterment would automatically follow and Indigenous people would be able to compete directly with other Australians, both in the formal labour market and in the business sector. Research has raised the possibility that there is no automatic positive correlation between funding and improved economic status. More recently there has been a call by Indigenous spokespeople, like Noel Pearson, for a paradigm shift in both governance structures and attitudes to work, education and welfare among Indigenous people.

The future

The issue of Indigenous poverty is greatly complicated by the diversity of types of Indigenous community and the variable impact of colonisation. This heterogeneity calls for a great deal of policy flexibility. There seems no doubt that most Indigenous people, whether urbanised or in remote locations, wish to maintain their distinct identity and cultural autonomy. How can this be reconciled in modern Australia with economic equality?

A crucial issue is the phenomenal growth in the Indigenous population. In 1971, the self-identifying Indigenous population was estimated at 116,000 persons. By 1996, the Indigenous population was estimated at 386,000 and in 2001 it is likely to exceed 427,000. Such rapid growth potentially places government Indigenous-specific programs under financial strain. It raises questions about appropriate targeting of those most in need and the relative merits of Indigenous-specific versus mainstream funding on the basis of location of residence and the particularities of circumstances. It also has negative implications for potential labour force status with recent estimates indicating that at best the unemployment rate for Indigenous people will remain unchanged, at worst it will increase.

One hard lesson from the last three decades is that low Indigenous economic status appears intractable. Any realistic prediction for overall economic equality measured by statistical social indicators will require a very long time frame, although equality may in fact be unachievable in certain circumstances. It will be incumbent on both governments and Indigenous leaders to defend both the heterogeneity and the exercise of choice that will mitigate against a rapid integration of Indigenous people into mainstream economic institutions. Government will need to retain policy flexibility and adhere to financial commitments in order to gradually improve the marginal economic position of Indigenous Australians. At the same time, the provision of core and equitable citizenship entitlements to Indigenous people as members of an increasingly diverse Australia will need to be maintained.

ISBN: 07315 2628 7

ISSN:1036 1774