What does disadvantage look like in Australia? New research shows who’s struggling most

The Australian government just released the 2026 report of the Economic Inclusion Advisory Committee.

The committee was asked to explore ways to reduce barriers to economic inclusion for people who experience severe disadvantage. A crucial part of this task is to identify who are the most disadvantaged groups in Australia.

Disadvantage is a concept that goes beyond income poverty to encompass people’s outcomes, including deprivation and social exclusion.

So what does disadvantage look like in Australia today?

What we did

The most comprehensive study of Australian disadvantage is the Productivity Commission’s 2013 report.

That report detailed approaches to measuring social and economic disadvantage between 2001 and 2010.

The Economic Inclusion Advisory Committee’s report draws on this framework, but updates its findings using 24 years of data from the Household Income and Labour Dynamics in Australia (HILDA) Survey.

The report looks at disadvantage using a range of metrics.

Income poverty

Income poverty is a measure based on the resources available to households – how much money households have coming in compared to a “poverty line”. People are said to be in poverty when their resources are below this line.

Using a poverty line set at half Australian median income before housing costs, poverty increased from 11.4% of the households in 2010 to 14.2% in 2022, then fell to 12.6% in 2024.

Half of all public housing tenants and 38% of people receiving income support payments were in income poverty in 2022.

Read more: We can’t fix what we don’t track. That’s why Australia needs an official poverty measure

Deprivation

The deprivation approach seeks to measure the outcomes of inadequate resources. These are measured as the extent to which people are missing out on purchasable items, activities or services regarded as essential by a majority of the population because the items were not affordable.

Examples include medical or dental treatment when needed, home contents insurance, and at least $500 in savings for an emergency.

The most widely experienced deprivation in 2022 was lacking home contents insurance (7.7%), followed by lacking $500 in savings for an emergency (7.4%), not having comprehensive motor vehicle insurance (4.3%), and not being able to afford dental treatment when needed (4.1%).

For most of these indicators, deprivation was stable or declining over this period. In 2014, 80% of the population experienced no deprivation at all. By 2022 this had increased to 84%.

While the experience of multiple deprivations has become less common, 4% of the overall population experienced three or more deprivations in 2022.

For people receiving income support, multiple deprivations are much more common. Around 30% of people receiving income support experienced deprivation in 2022, and more than 10% experienced three or more deprivations.

Social exclusion

Social exclusion is also a multidimensional concept that relates to someone’s inability to participate or engage in key economic, social and political activities.

Like deprivation, it is mostly an outcomes-focused measure of disadvantage – although some indicators of social exclusion also reflect peoples’ capability to effectively participate in society.

The report looks at trends in 28 indicators measured over seven key life domains: material resources, employment, education and skills, health and disability, social connection, community characteristics and personal safety.

Low wellbeing in the material resources domain has been broadly stable since 2001, while the employment domain shows mixed trends.

Unemployment fell from 2001, rose significantly during COVID, and then fell to lower levels.

Long-term unemployment has fallen more. The share of jobless households fell significantly from 14% to 9% at the end of the period.

The education domain shows more significant changes likely to reduce disadvantage. Low education has nearly halved from around 40% to closer to 20%. Poor English has also fallen, but is much lower.

Low work experience has generally fluctuated between 11% and 13%.

The trend is less encouraging in health. Poor general health ranges between 17% and 20%, but started to exceed 20% in 2018 and 2019 and has been 21–22% since 2021.

Poor mental health has increased from 9.3% in 2011 to above 14% since 2020.

The share of the population with a long-term health condition has increased from 23.9% in 2001 to 29% or higher since 2020.

Personal safety shows improvements, with the share experiencing personal violence falling from 2.1% to 1.4%. Those being a victim of property crime fell from near 7% to under 3%, and those feeling generally unsafe fell from 6.5% to under 2% since 2021.

Deep social exclusion

To be deeply excluded, a person has to experience exclusion from at least seven of the 28 indicators for the different life domains. The extent of deep social exclusion has increased from 5.6% of people aged 15 and over in 2010 to 6.6% in 2022.

The Productivity Commission ranked the groups identified as more likely to experience multiple forms or deeper disadvantage in 2010. This ranking has not changed over the subsequent 12 years.

By far the highest rates of deep social exclusion in 2022 were experienced by people who are unemployed (38.8%), public housing tenants (36.5%), people receiving income support (20.5%), people with long-term health conditions or a disability (16.3%), people with low educational attainment (16.3%), lone parents (15.7%), and Indigenous Australians (15.5%).

For public housing tenants, people who are unemployed, people receiving income support and those with low educational attainment, rates of deep disadvantage have increased significantly.

For Indigenous Australians, rates of deep disadvantage nearly doubled between 2010 and 2014, but then fell back, although still higher than in 2010.

Persistent disadvantage

While some people move in and out of disadvantage relatively quickly, others can remain disadvantaged for many years. The longer a person is disadvantaged, the harder it is for them to escape.

The extent of deep and persistent social exclusion – those experiencing deep social exclusion for four or more years between 2015 and 2024 – is highest for public housing tenants (27.8%) and those receiving income support (23.4%). These rates have risen since 2001–10.

Over this period there have been major changes in who is in public housing and who is on income support, with both groups reducing as share of the population.

Population ageing has had an impact. The share of the population experiencing deep and persistent exclusion who are over 60 increased from 11.7% to 19.5%.