Australia as a society generally is becoming more prosperous, according to the latest Household,
Income and Labour Dynamics in Australia (HILDA) Survey.
HILDA, conducted by the Melbourne Institute, is the country’s only nationally representative longitudinal household study. The latest HILDA report uses data from 2019 and does not address the impacts of the COVID-19 pandemic, which will become apparent in next year’s report.
The latest data shows that while Australia is a society with low levels of poverty and financial stress, challenges exist in some areas.
Since 2001, the level of income inequality has remained steady, rates of home ownership have decreased, and single parent families and young people continue not to fare as well as others in the community. The data also shows people are becoming increasingly vulnerable to psychological distress as the century progresses.
Report author Professor Roger Wilkins said the survey gave a crucial moving picture of Australian society.
“The first decade of this century was marked by strong growth in incomes amid the resources boom, but in the second decade income growth has been weak,” Professor Wilkins, from the Melbourne Institute of Applied Economic and Social Research, said.
“HILDA shows that younger Australians face a more daunting transition into financial independence – it takes them longer to leave home, longer to find full-time work, and home ownership is getting more out of reach. The economic challenges from the COVID pandemic will only make that worse.”
The 21st century Australian household
Since 2001, the number of families with adult children aged 18 to 29 still living at home has increased. This rise is most pronounced among women aged 18 to 25: in 2001, 63 per cent aged 18 to 21 and 32 per cent aged 22 to 25 lived with their parents, while in 2019 the corresponding proportions were 72 per cent and 50 per cent.
Household economic wellbeing/Income and income inequality
There has been little change in income inequality between 2001 and 2019. The Gini coefficient, a statistical measure of income inequality, has remained between 0.29 and 0.31 over the 19 years of the HILDA Survey.
Household disposable income has slowed over the past decade after jumping 28 per cent between 2001 and 2009. Since then, incomes have grown by just six per cent.
Home ownership has decreased with 65 per cent of households living in an owner-occupied home, down from 69 per cent in 2001. Meanwhile homeowners’ debt levels have more than doubled in real terms, from $168,300 in 2001 to $355,400 in 2019, based on 2019-dollar figures.
Income mobility has reduced slightly this century. When divided into five groups, from lowest to highest income earners, from 2013-2018, 30.9 per cent of Australians in the lowest-earning group were in a higher bracket in the next year, while 69.1 per cent remained in the bottom quintile.
Australia’s richest are more likely to remain in the highest wealth bracket now than at the beginning of the century – for those in the highest-earning group, the proportion who remained in the top bracket rose from 70.3 per cent in the 2001-2006 period to 74 per cent in 2013-2018.
People are becoming increasingly vulnerable to psychological distress over this century, with 23 per cent of women and 19 per cent of men in distress in 2019. This has increased by around 30 per cent since 2007 – comparing to 18 per cent and 15 per cent respectively in that year.
Melbourne Institute: Applied Economic and Social Research academic Dr Ferdi Botha said employment, economic wellbeing and regular social contact were clear determinants of psychological wellbeing.
“As your income goes up, your likelihood of psychological distress decreases,” Dr Botha said. “And, compared to those who see family and friends every three months at most, people who see family and friends at least once per week are about 10 percentage points less likely to experience psychological distress.”
Psychological distress has also become more prevalent among young people. Thirty per cent of those aged between 15 and 24 were in distress in 2019 compared to 21 per cent in 2007.
In 2019, 21 per cent of Indigenous women experienced psychological distress, being 1.8 percentage points more likely to experience psychological distress than non-Indigenous women.
People who’ve migrated from non-English speaking countries are both 3.9 percentage points more likely to experience distress than people born in Australia; in that group, 16.9 per cent of men and 17.6 per cent of women reporting psychological distress.
Australians are smoking significantly less than in 2001. Just 11 per cent of us smoke daily compared to nearly 19 per cent in 2001. We are drinking less too – 11 per cent of people drink alcohol five or more days a week compared to 15 per cent in 2002. However, other health concerns are worsening.
Obesity is growing, with 59 per cent of people overweight or obese, up from 54 per cent in 2006. There appears to have been little change in the amount of exercise people do. Just over a third of people exercise for 30 minutes at least three times per week, but not every day of the week, unchanged from 2001. The proportion of people exercising for 30 minutes every day is actually slightly down from 13.7 per cent to 12 per cent.
The proportion of couple-parent families with children where both parents are employed has increased to 71.1 per cent from 59.8 per cent in 2001. The proportion of families with pre-school aged children using childcare has almost doubled over that time, from 28.4 per cent in 2001 to 53.4 per cent. And with childcare comes childcare expenditure, which has increased from a weekly average of $130 to $205 in out-of-pocket expenses (at December 2019 prices).
Women at work
In heterosexual couples with children, women still do 21 hours more unpaid work at home compared with men – narrowing from 29 hours in 2002. Men are doing a bit more – 27.8 hours compared to 24.7 in 2001, while women average a bit less than they used to, 48.7 hours per week compared to 53.5.
Women feel more time stressed than men. Since 2001 the proportion of women who feel time stressed “often” or “almost always” has stayed constant at around 38 per cent, while the proportion of men feeling similarly time stressed has fallen from 34 per cent to 29 per cent.
The HILDA Survey tells the stories of the same group of Australians over the course of their lives. Starting in 2001, the Survey now tracks more than 17 500 people in 9500 households and will continue to grow as families expand.
It is funded by the Australian Government’s Department of Social Services.