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2039.0 - Information Paper: An Introduction to Socio-Economic Indexes for Areas (SEIFA), 2006  
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 26/03/2008   
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CHAPTER 1 INTRODUCTION



This chapter briefly introduces the 2006 SEIFA indexes, the concept SEIFA is measuring, and changes from the 2001 SEIFA.

  • SEIFA : BRIEF OVERVIEW
  • ABOUT THIS PAPER
  • BRIEF HISTORY OF SEIFA
  • THE CONCEPT OF SOCIO-ECONOMIC DISADVANTAGE
  • WHAT IS A SEIFA INDEX?
  • THE INDEXES
  • SUMMARY OF CHANGES TO 2006 SEIFA


SEIFA : BRIEF OVERVIEW

SEIFA stands for Socio-economic Indexes for Areas. This suite of indexes ranks geographic areas across Australia in terms of their socio-economic characteristics. The SEIFA indexes are created by combining information collected in the five-yearly Census of Population and Housing (called the Census throughout this paper). There are four different indexes, each representing a slightly different concept. These concepts are abstract and difficult to measure, so the indexes aim to capture these abstract concepts by combining information that is related to the concept. For example, the Index of Relative Socio-economic Disadvantage uses information such as low income and low education as markers of relative socio-economic disadvantage.


The SEIFA indexes are rankings. Each index ranks different geographic areas of Australia according to a 'score' that is created for the area based on characteristics of people, families and dwellings within that area.


For all of the indexes, relative disadvantage is associated with a low number.


There are a number of ways the indexes can be used, such as targeting areas for business or services, 'demographic profiling', strategic planning, design of sample surveys, and social or economic research. The most appropriate index should be chosen for each application.


The 2006 SEIFA indexes are freely available on the ABS website, cat. no. 2033.0.55.001 Census of Population and Housing: Socio-Economic Indexes for Areas (SEIFA), Australia - Data only, 2006.(footnote 1)



ABOUT THIS PAPER

This paper is an information manual. It is designed to explain SEIFA in non-technical terms. This paper is written so that each chapter is relatively self-contained for online access, and therefor may feel repetitive if all chapters are read together. Refer to Chapter 7 for references to more detailed and technical resources, especially the Socio-economic Indexes for Areas (SEIFA) Technical Paper (ABS cat. no. 2039.0.55.001, 2006) (called the Technical Paper throughout this paper).(footnote 2)


This Chapter


provides an Introduction: it briefly overviews each of the indexes, the concept SEIFA is measuring, and changes from the 2001 SEIFA.


Chapter 2


What is SEIFA? This chapter answers a number of Frequently Asked Questions: it describes the SEIFA numbers and indexes, and discusses the most frequently asked questions about SEIFA.


Chapter 3


How SEIFA is Constructed: looks at the concept behind the indexes, how the information is selected and what a typical variable looks like. This chapter also looks briefly at principal components analysis.


Chapter 4


How to Interpret SEIFA Score Distributions: assists the interpretation of the index scores, using distributions, examples and maps; and briefly introduces the geographic areas used in SEIFA.


Chapter 5


How to Use SEIFA: briefly discusses the use of SEIFA in analysis, bringing together some of the issues discussed in previous chapters.


Chapter 6


Ensuring SEIFA Measures Disadvantage: briefly discusses some of the methods used to ensure SEIFA measures socio-economic disadvantage.


Chapter 7


Further Information: provides references for related documentation.


Appendix


List of SEIFA Variables: lists the variables used to create each index.


Glossary


provides more detail on some of the terms discussed in this paper.



BRIEF HISTORY OF SEIFA

An index similar to SEIFA was first produced by the ABS from the 1971 Census. Substantial development of the indexes occurred in the late 1980s. SEIFA was first produced in its present form in 1990, using 1986 Census data, and consisted of five separate indexes. For the 2001 SEIFA, the variable selection process was revised and two indexes (the Urban and Rural indexes) were replaced with a single Index of Relative Socio-economic Advantage and Disadvantage. The same four indexes have been released for 2006 SEIFA and are overviewed later in Chapter 1 and discussed further in Chapters 2 and 4.



THE CONCEPT OF SOCIO-ECONOMIC DISADVANTAGE

The concept of relative socio-economic disadvantage is abstract and difficult to capture. The SEIFA indexes are trying to capture socio-economic disadvantage, in terms of relative:

  • access to material and social resources; and
  • ability to participate in society.

As discussed in Chapter 3, there are two important issues to remember about SEIFA and the concept of relative socio-economic disadvantage:
  • there is no perfect measure of disadvantage; and
  • it is a summary measure that represents an 'average' of people and households in a particular area.


WHAT IS A SEIFA INDEX?

What is a SEIFA index?


SEIFA indexes are summary measures of a number of variables that represent different aspects of relative socio-economic disadvantage and/or advantage in a geographic area. For example, the Index of Relative Socio-economic Disadvantage uses information deemed to indicate a general level of relative socio-economic disadvantage. This index can then be used to show how one community compares to another community; that is, every area in Australia can be ranked using this summary measure of relative disadvantage.


How are the indexes created?


A summary measure for a particular community is created by combining information about the households and individuals who live in that area. The method used to combine this information is called Principal Components Analysis.


What information is used?


Because the indexes are strongly influenced by the choice of information used to create them, the information is selected with care. Information from the Census is only selected if it is deemed to reflect some element of relative socio-economic disadvantage. Each index aims to capture a different aspect of relative socio-economic disadvantage and therefore different information is used to construct each index.



THE INDEXES

Each index measures a slightly different aspect of socio-economic conditions within an area. Please refer to Chapters 2 and 4 for more detail on each index.


Disadvantage


The Index of Relative Socio-economic Disadvantage (IRSD) is a general socio-economic index that summarises a range of information about the economic and social resources of people and households within an area. Unlike the other indexes, this index includes only measures of relative disadvantage. This index will be called the Index of Relative Disadvantage throughout this paper.


Advantage and Disadvantage


The Index of Relative Socio-economic Advantage and Disadvantage (IRSAD) also summarises information about the economic and social resources of people and households within an area, however includes both relative advantage and disadvantage measures. This index will be called the Index of Relative Advantage and Disadvantage throughout this paper.


Economic Resources


The Index of Economic Resources (IER) focuses on the general level of access to economic resources of people and households within an area.


Education and Occupation


The Index of Education and Occupation (IEO) focuses on the general level of education and occupation-related skills of people within an area.



SUMMARY OF CHANGES TO 2006 SEIFA

As a general rule, every effort is made to keep SEIFA the same as the previous release. However, some changes are important or unavoidable. These changes are overviewed in later chapters and discussed in more detail in the Technical Paper.


New variables


Some new data items that were introduced into the 2006 Census were analysed and included in the indexes. These new measures relate to broadband internet access, and a need for assistance with core activities.(footnote 3) Some existing Census data items that had not been included in previous SEIFA indexes, were reconsidered for inclusion in some 2006 SEIFA indexes. For example, variables relating to housing costs and household over/undercrowding were analysed and included in the 2006 Index of Relative Advantage and Disadvantage.


Changed Census variables


Some variables were changed in the 2006 Census, as detailed in the Technical Paper. The more important changed variables related to occupation and dial-up internet access.


Other major changes


A significant change to SEIFA in 2006 is the use of Equivalised Household Income instead of the set of twelve family-structure income variables previously used. Both methods take into account the family structure of the household, such as the number of adults and children. However, equivalised household income captures more family types and is represented by only two variables in SEIFA. This change affects three of the indexes, particularly the Index of Economic Resources.


Previous SEIFA were created using Census information about people who were in an area on Census Night. For 2006, SEIFA instead uses information about people who usually reside in the area. This means 2006 SEIFA is representative of the usual residents of an area, rather than people who happened to be in the area on Census Night, such as travellers.


Index of Economic Resources


The Index of Economic Resources has been revised to include variables that represent a wider range of economic resources, particularly aspects of relative wealth.


Excluded areas


Some areas do not have a SEIFA score. For example, if there are too few respondents in an area, then a valid score cannot be calculated for the area. The rules for excluding areas have been revised and are described in Chapter 2.


1 http://www.abs.gov.au/ausstats/abs@.nsf/mf/2033.0.55.001 <back
2 http://www.abs.gov.au/ausstats/abs@.nsf/mf/2039.0.55.001 <back
3 The new Census questions on need for assistance were developed to provide an indication of whether people have a profound or severe disability. People with a profound or severe disability are defined as those people needing help or assistance in one or more of the three core activity areas of self-care, mobility and communication, because of a disability, a long term health condition (lasting six months or more) or advanced age. This is not a comprehensive measure of disability. Please refer to the Glossary for further information <back


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