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Family Matters No. 37 - April 1994

Regional disadvantage and unemployment

Christine Kilmartin


In this fourth article focusing on disadvantaged families in this issue of Family Matters, the author looks at rural and urban areas where families are experiencing regional disadvantage, particularly because of limited work opportunities. The article begins by alerting designers of policy to the fact that the 'region' of disadvantage can be very small. Consequently the criteria used for funding can exclude regions with concentrated pockets of disadvantage because the balance of the region outweighs the smaller areas of disadvantage. Next, the author discusses regional employment and unemployment and methods of tackling unemployment when it is concentrated in regions. A table shows areas of Australia which have a long-term unemployment rate of 5 per cent or higher. Regional employment initiatives of the Office of Labour Market Adjustment and other bodies are also discussed. Finally, the author recommends encouraging a human-resource-sharing relationship between well resourced areas and ones suffering from a lack of diversity and employment opportunities.

This paper looks at rural and urban areas where families are experiencing regional disadvantage, particularly because of limited work opportunities.

Regional development has had a revival in both Federal and State policy design as a means of addressing issues of access to employment and services. In general, this is a necessary, realistic and positive development. However, before discussing the current regional emphasis, several general comments need to be made about this approach.

First, it needs to be recognised thatany significant level of aggregation begins to wash out sub-regional variations in disadvantage, variations which might require policy sensitivity. Second,people relate to their immediate area and often feel some degree of responsibility for looking at issues that are close to home. Too large an aggregation tends to remove the notion of ownership and replace it with one of management.

Consequently, one important point for designers of policy to note about regional disadvantage is that the 'region' of disadvantage may be very small. Service providers know very well the enormous extremes that can exist between advantage and disadvantage within very small areas. In both inner city and other urban areas, development has occurred in such a way that only a couple of streets might separate the very well off from the very poor.

While the targeting of programs means that the people who need assistance get it, the criteria used for funding can exclude regions with concentrated pockets of disadvantage because the balance of the region outweighs the smaller areas of disadvantage. For instance, in Campbelltown, on the outskirts of Sydney, the pockets of public housing are dotted around the municipality in such a way that some services qualify for particular additional funding while others, which would appear to be dealing with a similar degree of need, do not. The 'regional' disadvantage is no less real for such pockets of families, particularly when shops are not close at hand, when public transport is inadequate, or when the newly designed residential courts are in fact so crowded that privacy is minimal, police callouts are frequent, and schoolteachers are fraught.

This notion of 'reduced regional' means that policy design has to be flexible to take into account numbers of people, not just proportions, and to recognise that setting minimum participant levels in programs may disadvantage those areas where concentrations are below that minimal level but where the need, nevertheless, is real.


Local labour markets are subject to both national and international changes in demand. Some of the worst unemployment is concentrated in regions where one industry has been winding down, such as the inner northern suburbs of Melbourne, where employment was focused on the textiles, clothing and footwear industry, or the steel producing Illawarra region, covering Wollongong and surrounds. Even in Tennant Creek, a town with a labour force of only around 1500, international demand in the mining industry can reduce the local labour force by 200 or more in the one week.

Speaking broadly, there are two main ways of addressing unemployment when it is concentrated in regions.First, there may be a redistribution of surplus labour to other regions - those out of work move to places where work is available. This has always been prevalent in rural areas, where seasonal work demands labour shifts; it probably also happens in unmeasurable ways within urban conurbations. Second, work may be redistributed to where labour exists - work comes to depressed regions. Telematics, for example, make this relatively easy in the 1990s, but many government initiatives over decades have attempted such an approach.

Is the redistribution of surplus labour or the redistribution of work, or both, feasible as strategies?

Redistribution of labour has problems. Expecting people to travel or relocate to access employment and services is not a sufficient policy response. As the Committee on Employment Opportunities (1993:119) notes, 'people do not always want to move away from families and friends and this cannot be imposed upon them'.

Ensuring the shift of employment opportunities to regions of disadvantage requires careful attention to labour market programs appropriate to the region. The Federal Government's Green Paper, Restoring Full Employment, recognises that any work available in remote or rural areas tends to be concentrated in either the mining or agricultural industries and therefore labour market programs designed for urban areas might be unsuitable. It suggests harnessing either the Community Development Employment Projects (CDEP) or New Enterprise Initiative Scheme (NEIS) programs which are already in existence.

While the CDEP was developed for Aboriginal people in remote communities, there are some elements which might be applicable to urban regions. Elizabeth in South Australia is an area where second and third generation unemployment is becoming increasingly common and it could benefit from a program which harnesses people's sense of belonging to an area and provides goals and some meaning to their lives. These elements might also help in other economically disadvantaged urban areas. The skills of the Commonwealth Rehabilitation Service (CRS), among other services, have been employed to address the big leap which the long-term unemployed, who may not have seen their parents work either, need to make if we are going to reduce regional economic disadvantage. Resources to restore self-esteem, motivation and confidence will be necessary if the proposed job compact outlined in the Green Paper is to work. ACOSS (1994) considers that a major criticism of the Green Paper is that little consideration is given to strengthening employment growth in the most disadvantaged regions.


In terms of numbers, the unemployed are concentrated in the capital cities and the larger regional centres. The areas classed as rural and remote contain only 15 per cent of the total unemployed. Overall, two thirds of the unemployed are concentrated in the eight capital cities and only one third in the major regional areas and the other regional, rural and remote areas. If resources are to be allocated to address regional employment disadvantage, then the urban areas, particularly Sydney and Melbourne, should attract their share.

Within Sydney, in the June quarter of 1993, the five local government areas with the largest numbers of unemployed were Fairfield (17,600 unemployed; unemployment rate 18.5 per cent), Blacktown (14,400 - 13.9 per cent), Bankstown (10,100 - 13.2 per cent), Canterbury (9900 - 15.2 per cent) and Wyong (7800 - 17.5 per cent). The western suburbs of Sydney would need to generate in the order of 40,000 jobs just to reach the target of 5 per cent unemployment set in the Green Paper.

If regional economic disadvantage is to be addressed, then it will not be sufficient to create jobs away from where the unemployed live and in areas which can only be reached through Sydney traffic. Melbourne in 1993 required an even larger generation of jobs than these Sydney figures illustrate.


While the capital cities and major regional areas have the largest concentrations of numbers of long-term unemployed (305,000 or 68.8 per cent ), many non-metropolitan areas across several States have extremely high rates of long- term unemployment (see accompanying Table), meaning that high proportions of the local population are experiencing long periods of unemployment. These areas would also need heavy investments of training under the Jobs Compact proposed in the Green Paper. Note that the figures in brackets in the Table indicate the proportion of the labour force (not of the unemployed) who have been out of work for 12 months or more. So, in Walgett, 15.9 per cent of the total workforce have not had a job in more than 12 months.

The future does not look bright for pockets of unemployed people concentrated in particular areas, particularly those where long-term unemployment is becoming entrenched. Such concentrations are found throughout New South Wales and Tasmania, and to a slightly lesser extent in Victoria and South Australia.

In terms of proportions, the areas with the greatest need of assistance for the long-term unemployed are some of the remote areas: Tennant Creek, Coober Pedy, other remote areas of the Northern Territory and Walgett. Then follow some entrenched areas such as central inland New South Wales, the northern coast of New South Wales and almost the whole of Tasmania.


Considerable effort is being applied at both Federal and State levels to reduce unemployment and its effects. Federally, a major focus has been given to regional employment initiatives by the Office of Labour Market Adjustment (OLMA).

Focus of OLMA activity

In 1988, the Federal Government established the Office of Labour Market Adjustment (OLMA) to facilitate the process of adjustment and cushion the adverse impacts which can fall unequally on some members of the labour force (DEET 1993b).Since then, the Department of Employment, Education and Training through OLMA has developed a series of policy measures based on concepts of regional disadvantage. These regional initiatives have been designed to address the impact of structural change on specific geographical labour markets (DEET 1993a).

OLMA regional initiatives are based on several key features which have developed from the experience of implementing labour market programs. These include: involving the community and local business;encouraging local ownership of the program;balancing program flexibility with accountability and ensuring CES links. OLMA is currently under review, but the principles under which it operates appear sound and in accord with reports from service providers about the features necessary to ensure appropriate service delivery to the community. Given the funding restraints already being hinted at for the Federal Governments forthcoming White Paper on Unemployment, it would seem appropriate to continue to resource OLMA activities and to build upon their experience.

Other players involved

OLMA has not been alone in attempting to address regional disadvantage. Apart from such Federal structures as the Commonwealth Employment Service and the newly established Office of Regional Development, a series of State agencies have taken on the regional perspective.

Voluntary Regional Organisations of Councils operate Australia- wide to cooperate on issues of infrastructure provision. Several programs are now in place to enhance the ability of local councils to take a regional perspective on social and economic issues.To this point, however, most local councils have not seen themselves as responsible for generating employment, and have left that to any local economic development boards of which they may be members. The service providers interviewed in the AIFS Australian Living Standards Study were prepared to express their opinion about the quality of a range of local services, but very few saw themselves as being able to comment on employment. Job creation has baffled even the most astute, and if local initiative is to be encouraged, it will require support and resourcing.

One example of regional support has occurred in Queensland where the Department responsible for regional development (DBIRD) has conducted search workshops in a number of regional communities to assist those communities to think about the initiatives which they may be able to take to create employment opportunities in their own areas. Some of these have been quite successful, and have resulted in the creation of national and overseas markets for local products from relatively isolated communities. In South Australia, the Economic Development Authority has also worked with local communities, in conjunction with OLMA, to assist in a similar way.

Other ways of addressing regional disadvantage include the National Equity Program for Schools which provides additional funding to schools in regions containing higher proportions of households subject to poverty, violence, drug abuse, poor literacy and numeracy, geographic isolation and family breakdown. And there are a host of other programs, delivered through departments like those associated with health, Aboriginal support, and ethnic affairs.

It would be nigh on impossible to measure the dollars flowing into particular regions through the host of programs which services can tap into. Nevertheless, if real measures are to be developed in addressing this key priority of the International Year of the Family, some measure of the changes in the lives of people, based on aggregated regional data, needs to be established.

In promoting the concept of micro-economic reform, the meeting of the Council of Australian Governments in Hobart in February 1994 argued for a reduction in tied grants, enabling more discretion at State level about the ways in which funds need to be distributed. This loss of tied grants is of potential concern to regional social justice, and needs to be linked with a strong process for setting priorities within States, with community involvement and consultation with bodies such as the Councils of Social Service.


Experience in both Australia and overseas suggests that regional development of employment and other human services requiresa clear directional statement by Federal and State governments about the long-term value of particular areas to the social and economic wellbeing of the Australian community. This is being done indirectly through processes such as the declaration of OLMA regions, the closure of railways, schools, hospitals and banks, but lacks coordinated 'planning for decline' thinking. It is understood that the Queensland government is currently involved in this exercise and will be releasing its policy during 1994.

Also needed is a meshing of social and economic planning and the structures which allow local governments and others to look at how they plan their areas and sub-areas to ensure that disadvantage is not concentrated. This goes beyond the proposal for Regional Economic Development Organisations put forward in the report of the Taskforce on Regional Development (1993) and requires resourcing of appropriate regional coordination bodies. That the past is littered with such bodies should not dissuade those who are calling for coordination as a means of rationalising expenditure from trying another form.

Policy planners are currently operating on a series of untested assumptions about the benefits of social mix. They would be assisted by a better understanding of the impact that the design of housing and other services in local areas has upon the long-term functioning of the area.

Expansion of traineeships, NEIS and other labour market programs involving collaboration between the community, local industry and the trainers is needed across the widely dispersed areas where the long-term unemployed are living.

DEET has initiated the Innovation for Employment Strategy which has called on communities to throw up ideas for employment. In areas of concentrated disadvantage, the same practice might be employed, using groups to initiate discussion about possible ventures then employing mentors from the business community and industry to assist local people to shape these ideas into feasible projects. Such an approach recognises the principles espoused by the Taskforce on Regional Development and others in giving people the chance to participate in their community, to have a say about their own future employment.

It is encouraging to see a developing recognition of the importance of building on local strengths and harnessing the energy to bring about change from the bottom. The Taskforce on Regional Development commented upon the strength of the communities it contacted around Australia and saw the possibilities of building on that strength. Small regions in isolated Australia have developed their own international markets to sell their products and keep their areas alive and productive. This is feasible for a wide range of communities, but needs financial support and endorsement through flexible policies.


There has been considerable recognition of the value of human resources in assisting local areas. It is hard, for example, to see how Landcare (an initiative of the National Farmers Federation and the ACTU to involve local communities in upgrading environmentally depleted areas) would function at all if rural areas were to lose their populations to the larger regional cities. Landcare has worked, not only because it has built upon local knowledge and skills, but also because it has harnessed local commitment.

However, because some areas do not attract those in senior business and industry positions as residents, there may be some advantage in encouraging a human-resource- sharing relationship between the well resourced areas and ones suffering from lack of diversity and opportunity in employment. Such a resource sharing program need not be confined to issues like employment: a practice of doctors, for example, might consider expanding to a rural area which lacks access to the skills they possess, thus providing a choice and stability of medical services not usually available.

Such a concept of 'Area-Shares' would need resourcing, in much the same way as the Federal Government now resources coordinating bodies in the community management sector. Nevertheless, such resourcing would be complementary only to the voluntary injection of skills and interest by those participating in the program.


  • DEET (1993a), Programs 1993-94, Australia, Department of EmploymentEducation and Training, Canberra.
  • DEET (1993b), The Office of Labour Market Adjustment: Interim Review,Department of Employment, Education and Training, Canberra.
  • DEET (1993c), Small Area Labour Markets, Australia, June Quarter 1993,Economic ans Policy Analysis Division, Department of Employment, Education and Training, Canberra.
  • ACOSS (1994), 'Response to the Green Paper on Employment Opportunities', Unpublished Paper, Australian Council of Social Service, Sydney.
  • Taskforce on Regional Development (1993), Developing Australia: a Regional Perspective. Volumes 1 and 2, AGPS, Canberra. 3