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Family Matters No. 35 - August 1993

Unemployment income support, the active society and AEDP

Barry Smith

Abstract

The Australian government has endorsed the OECD Active Society policy framework. The purpose of the new active system of support to the unemployed aims to eliminate the development of a 'dual society composed of insiders who have economic and social status and outsiders who represent an underclass with no economic or social bargaining power'. Part of this Active Society policy is the Aboriginal Employment Development Policy (AEDP). Two major objectives of the AEDP are employment equity and income equity with other Australians for Aboriginal and Torres Strait Islander people by the year 2000. One strategy of AEDP is the Community Development Employment Projects (CDEP) whereby Aborigines in remote areas work in community activities for wages equivalent to unemployment benefits. The author analysed the labour market environment of two remote area CDEP communities in the Northern Territory - Daguragu and Papunya to see if, after five years of AEDP, more members of Aboriginal families had gained access to the conventional labour market and the Active Society. The author found that there is no clear evidence that AEDP has resulted in the development of additional conventional labour markets through particular enterprises.

The Social Security Review Issues Paper No.4, Income Support for the Unemployed in Australia: Towards a More Active System (Cass 1988), publicly but indirectly indicated the commitment of Australian policy makers to the OECD Active Society policy framework as the means of dealing with the poverty and marginalisation of the long-term unemployed. In an Active Society 'persons are able to participate in both economic and non-economic facets of community (national) life to the extent they desire and to the extent which is sanctioned by the society' (Kalisch 1991).

The Issues Paper stated that 'in terms of community incomes, unemployment beneficiaries fall within the poorest tenth of income units' (Cass 1988).

Kalisch (1991) reported that: 'In most (Western) countries, the level of unemployment income support made available to individuals who are in need is insufficient to meet more than basic needs . . . The only effective means of increasing the level of income received by individuals is to facilitate an exit from their current situation into one which provides higher income streams . . . regular full-time employment, with award wages being paid and other supportive assistance available to low income earners.' He concluded that, 'allowing disadvantaged persons to remain in their current situation does nothing to solve their problem and is more likely to reinforce their labour market exclusion', and indicated that in terms of the Active Society the extent of a family's link with the conventional labour market will determine that family's ability to combat poverty and marginalisation. The more detached the family members are from the conventional labour market the greater the risk of impoverishment and social powerlessness.

The new 'active system' of support to the unemployed was to provide 'protection from poverty', 'improved incentives' to obtain employment, 'equity of treatment' of the long-term unemployed and 'closer integration between income support programs and labour market training programs' (Cass 1988). Such an Active Society approach would eliminate 'the development of a dual society composed of insiders who had economic and social status and outsiders who represented an underclass with no economic or social bargaining power' (Kalisch 1991).

Two major objectives of the Aboriginal Employment Development Policy (AEDP), which effectively came into operation during the Social Security Review, were employment equity with other Australians and income equity with other Australians for Aboriginal and Torres Strait Islander people by the year 2000 (Australian Government 1987a).

In view of the Australian Government's endorsement of the Active Society policy framework in other income support areas such as JET (Jobs, Employment and Training), JSA (Job Search Allowance) and NEWSTART, and DSP (Disability Support Payment) (Winter 1991), it would be safe to conclude that the 'income equity' of Aboriginal Australians would be fulfilled through the achievement of the 'employment equity' objective. Employment equity would in turn be achieved by pursuing full Active Society membership for all Australian citizens.

Employment equity seemed to suggest that by the year 2000 the employment profile of Aboriginal and Torres Strait Islander people would consist of a mix of components including all those enjoyed by the Australian (national) community. In fact, the Australian Government aims to increase the proportion of Aboriginal people aged 15 and above who are employed from 37 per cent to around 60 per cent. 'To achieve this, Aboriginal people must be able to work in the same jobs as other people' (Australian Government 4-2-197) but also be able to use 'a mix of components from their own traditional hunter-gatherer subsistence economy' (Miller 1985).

AEDP Strategies

The AEDP suggested that as part of the transition from low levels of employment in remote areas to employment equity, it would be necessary to support Aboriginal people in these areas through employment creation, enterprise development and training at the local level. This would be achieved by a range of active strategies including the Community Development Employment Projects (CDEP) scheme through which Aboriginal people work in community activities for 'wages' approximately equivalent to unemployment income support payments. These strategies would ensure 'that all different kinds of jobs that need to be done in (remote area Aboriginal) community can be done by Aboriginal people' (Australian Government 4-2-200).

Aboriginal people and employment

An analysis of the conventional labour market environment (Australian Bureau of Statistics statistical local areas) of two remote area CDEP communities in the Northern Territory - Daguragu in central Northern Territory, and Papunya in southern Northern Territory - was carried out to see if, after five years of AEDP, more members of Aboriginal families had gained access to the conventional labour market and the Active Society.

Using 1986 and 1991 Census data, the analysis attempts to compare: the dominant industries in the two communities' statistical local areas in 1986 and 1991; industry changes between census recordings; and Aboriginal and non- Aboriginal employment in industries in the two periods.

Papunya area

Agriculture is a small but important industry in Papunya's statistical local area of Tanami. There was some growth in the industry in the 1986-1991 period, but Aboriginal people made no inroads into this industry, one which is often considered a traditional area of mainstream Aboriginal employment.

Mining experienced a large growth of 109 positions, making it a very significant employer in the area. Aboriginal people gained only two of these new positions.

Aboriginal people made real gains in the Wholesale/Retail industry by securing 40 of 51 new positions. Public Administration is still an important but small employer in the area. Although there was a marginal growth of five positions, Aboriginal residents' claim on these positions weakened. In 1986 they had 33 of the 45 Public Administrations positions, whereas they now have 31 of the 50 positions. The Recreation/Personal Service industry is also a small but important employer. This industry grew by 12 positions, but Aboriginal people made no gains and still held only six positions out of the 35.

The big growth area was Community Services. In line with observations about CDEP and Community Service positions (Altman and Daly 1992, Smith 1991), it is not surprising that 300 of the 305 new positions were filled by Aboriginal people. However most of the new positions were classified as 'Community Services Other' or 'Community Services Undefined'. There were some minor changes in the Health and Education sectors of Community Services. Aboriginal Health positions increased from 29 to 31 and non-Aboriginal Health positions from 24 to 25 - minor growth and no redistribution. In Education, the number of positions actually fell by ten from 133 to 123. However, Aboriginal people fared better in that their number of positions in the smaller market rose from 58 to 65 - some redistribution in a shrinking market. In terms of AEDP and the Active Society, given the large numbers of new Community Services positions, the Health and Education and Public Administration figures are very disappointing.

The Community Services figures reinforce the conclusion suggested by the Agriculture, Mining and Recreation/Personal Services industry figures. That is, Aboriginal people in the Papunya area made few inroads into the conventional labour market and have primarily been channelled into Other and Undefined Community Services positions.

  • In Papunya's statistical local area, there were 467 positions in Agriculture, Mining, Construction, Wholesale/Retail, Public Administration and Recreation and Personal Services. In these conventional labour market positions 122 were held by the 2630 Aboriginal residents of labour market age, whereas 345 were held by the 718 non- Aboriginal people of labour market age.
  • Of the 612 Aboriginal people employed in all industries in 1991, 290 (47.5 per cent) were employed as labourers. This compares with 15 per cent of non- Aboriginal people who were employed in labouring positions.

The above facts seem to take some of the shine off the 11 per cent employment rate gain made by the Aboriginal people in the five-year period between 1986 and 1991. Most increase has been in undefined labouring positions, suggesting the employment gap between Aboriginal and non-Aboriginal people in Papunya's statistical local area is worse than the actual 54 per cent , if we take quality of jobs into account.

Daguragu area

There has been a large decrease in the number of Aboriginal people involved in the Agriculture industry - a major conventional labour market industry in Daguragu's statistical local area of Victoria. This may mean that fewer Aboriginal people are now working in the stock industry of the area or it could be that many of these positions have been converted to CDEP positions and are now paid and recorded as Undefined Community Services positions. While recorded Aboriginal employment in the industry has decreased and therefore has reduced overall numbers, the number of non- Aboriginal people in the industry has increased by 23.

The 1986 Census figures indicated that Construction was a small but significant industry in the area. At the time of the 1991 Census there were an additional 56 people working in Construction. Of the 102 people employed, 34 were trades people and the rest labourers. According to the figures, Aboriginal people held four trade and four labouring positions.

It might be assumed that Aboriginal employment, at least as unskilled trade workers,would be higher given that some of the construction may have been taking place on Aboriginal communities. Although there were an additional 56 positions, Aboriginal residents gained only three of these, even though they made up almost 53 per cent of the population of labour force age.

Wholesale/Retail remains a small but significant industry with a growth of six positions. However, Aboriginal people, particularly females, have lost out in the competition for work in this area, occupying 12 positions in 1986 and only three in 1991. Non-Aboriginal people, particularly females, filled not only the nine positions lost by Aboriginal people but also the six new positions.

With 53 additional positions for the statistical local area, Public Administration has been one of the growth industries. Again, however, Aboriginal people have not gained significantly from the growth, with 70 of the 112 positions being filled by non-Aboriginal people. In fact, non-Aboriginal people secured 48 of the 53 new positions in this industry. This hardly reflects the AEDP goal of Aboriginal people administering their own affairs.

Again, Community Services was responsible for the greatest employment growth and added significantly to the Aboriginal employment rate. Of the 295 additional Community Services positions, 275 were filled by Aboriginal residents. Of the total 315 Community Service positions filled by Aboriginal people, 123 males and 137 females were reported as employed in Other Community Services, and 24 males and 17 females were recorded as working in Undefined Community Services.

Of all the Aboriginal Community Service positions, 96 per cent were unspecified positions. In fact, in the Health and Education sectors of Community Services, positions were lost overall, with Aboriginal people filling fewer of the reduced number of positions.

In the Health area, the number of recorded positions fell from 23 to 20, but in 1991 Aboriginal people filled only three positions instead of the 14 they held in 1986. In Education, positions fell from 62 to 42; Aboriginal people filled 20 positions in 1986 and 11 in 1991.

While the number of unspecified Community Service positions is high, it is interesting to note that the percentage of Aboriginal and non-Aboriginal people working as labourers was almost equal in 1991 - 24 per cent and 27 per cent respectively. However, the figures do point to some possible missed opportunities for Aboriginal people as 135 of the 336 positions filled by non-Aboriginal people in the Agricultural industry were unskilled labouring positions.

  • In Daguragu's statistical local area in June 1991 there were 690 people employed in Agriculture, Construction, Wholesale/Retail, Public Administration and Recreation and Personal Services. Of these conventional labour market positions, 125 were held by the 1053 Aboriginal residents of labour market age, while 565 were held by the 950 non- Aboriginal people of labour market age. Thus 12 per cent of Aboriginal, compared with 59 per cent of non-Aboriginal residents of labour market age, held positions.

Conclusion

  • There is no clear evidence from the remote statistical local areas demonstrating that AEDP has resulted in the development of additional conventional labour markets through particular enterprises. In some industries, in particular the Health and Education sectors of Community Services, the major AEDP remote area strategy - that is, the Community Development Employment Project (CDEP) - has been accompanied by a loss of some conventionally funded positions.
  • The comparative statistics suggest that Aboriginal people in both the statistical location areas analysed are not gaining equitable access to conventional labour markets. Aboriginal people are under-represented in almost all conventional labour market industries.
  • From the analysis, it is possible to conclude that two distinct labour markets are developing - the Active Society's conventional labour market in which non-Aboriginal people have high employment rates and a non-conventional labour market in which Aboriginal residents are represented in increasing numbers.

If this analysis of the ABS data of the two remote areas is indicative of the situation of other remote Aboriginal families' communities, then serious problems exist in remote areas. The problems appear to be the compatibility of the Aboriginal Employment Development Policy's primary remote area strategy and the achievement of Active Society policies.

After five years of operation, AEDP remote area strategies have not achieved significant outcomes for Aboriginal families in terms of equitable access to the conventional labour market. Aboriginal families are still not 'integrated' into the conventional labour market and therefore do not have the opportunity to 'exit from their current situation of poverty and social powerlessness into one which provides higher income streams' (Kalisch 1991).

It appears that the major AEDP remote area strategy (CDEP) has moved some remote Aboriginal people from 'passive welfare dependency' to an employment 'activity' oriented program. The ABS data do indicate that remote area Aboriginal family members of labour force age are more active but that their employment is predominantly in what appears to be a second (non-conventional) labour market.

The long-term danger of the creation, growth and institutionalisation of a second labour market, which exists outside the conventional labour market, is that it could reinforce the exclusion of many remote area Aboriginal families from the conventional labour market.The institutionalisation of such exclusion would deny remote Aboriginal families the opportunity of higher wages and the occupational benefits of the conventional labour market. Members of remote Aboriginal families of labour force age could still find themselves unable 'to participate in both economic and non-economic facets of Australian community life to the extent they desire and to the extent which is sanctioned by society' under the Active Society policy framework (Kalisch 1991). In the long term, Aboriginal families would still be living in poverty, and socially and economically powerless. They would be 'active' but still excluded from the Active Society.

If the above scenario is to be avoided, CDEP must be used as a starting program only and not as an end position. The participants who start in the program must be offered conventional labour market training opportunities and program places. Such training should offer skills and qualifications which provide options to move into the conventional labour market in or outside their families' area. Taking up such options should result in the reallocation of conventional labour market jobs to local Aboriginal families. Reallocation must not become merely a buzzword but be used by planners and policy makers to set objectives to ensure the reallocation of jobs to Aboriginal families, thereby offering real opportunities of access to the Active Society.

References

  • Altman, J. and Daly, A. (1992), The CDEP Scheme: A Census-based Analysis of theLabour Market Satus of Participants in 1986, CAEPR Discussion Paper No.36, Centre for Aboriginal Economic Policy Research, ANU, Canberra.
  • ATSIC (1991), Community Development Employment Projects (CDEP) UserGuide, ATSIC, Canberra.
  • Australian Government (1987a), Aboriginal Employment Development Policy Statement, Policy Paper No.1, AGPS, Canberra.
  • Australian Government (1987b), Aboriginal Employment Development Policy: Community-based Employment and Enterprise Strategies, Policy Paper No.3, AGPS, Canberra.
  • Australian Government (4-2-197), Aboriginal Employment Development Policy, What's it all about, Brochure 1.
  • Australian Government (4-2-199), Aboriginal Employment Development Policy, Jobs in the Country, Brochure 3.
  • Australian Government (4-2-200), Aboriginal Employment Development Policy, Jobs in Remote Areas, Brochure 4.
  • Cass, B. (1988), Income Support for the Unemployed of Australia: Towards a MoreActive System (Issues Paper No.4 of the Social Security Review), AGPS, Canberra.
  • Department of Finance and Department of Prime Minister and Cabinet (1989), Towards a Fairer Australia. Social Justice and Program Management: A Guide, AGPS, Canberra.
  • Kalisch, D. (1991), 'The Active Society', Social Security Journal, August 1991.
  • Miller, M. (Chairman) (1985), Report of the Committee of Review of Aboriginal Employment and Training Programs, AGPS, Canberra.
  • Smith, B. (1991), Active Employment Strategy, Industries and Employment: Remote North Australia, NADU Discussion Paper No.7, North Australia Development Unit, Darwin.
  • Winter, G. (1991), A Guide to Newstart - The Active Employment Strategy, Parliamentary Research Service, Canberra.