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This section outlines the key details of the process used to derive each of the four SEIFA indexes: the IRSD, IRSAD, IER and IEO. Each index is a weighted combination of different Census variables. A more detailed description of the index construction is given in Chapter 4 of the Technical Paper.
Choosing the variables
Variables are included in the initial variable list if they relate to the ABS definition of advantage and disadvantage that SEIFA is trying to capture. The main constraint to the initial variable list is that the variables can only be sourced from Census data. To learn more about the variables used, please see Chapter 3 of the Technical Paper.
Proportions: The indexes are calculated using 2011 Census data at the base level of Statistical Area Level 1 (SA1). All of the variables included in the indexes are calculated as proportions at the SA1 level. For example, the proportion of unemployed persons is calculated as the number of unemployed people divided by the total number of people in the labour force in each SA1. Previous releases of SEIFA were constructed at the Census Collection District level. For more information on the new geography standard, see Geography ASGS.
Areas without SEIFA Scores: Due to non-response and low population levels in some SA1s, not every area can be given a meaningful index score.
If a SA1 meets one or more of the following criteria, the area does not receive an index score:
The criteria above aim to ensure the largest number of areas receive a score, whilst maintaining an acceptable level of quality.
The indexes are a weighted combination of Census variables. The method used to determine the weights and final variable composition is called Principal Component Analysis (PCA). The weights describe the relative importance of each variable. If the weight created by PCA for a particular variable is too low, the variable is dropped from the index. These variables do not meaningfully contribute to the indexes.
Note that the variable weights are calculated by a data-driven method. They are not determined subjectively by the ABS.
If you wish to learn more about PCA, please refer to Chapter 4 of the Technical Paper.
Once the variable weights have been finalised, they are used together with the variable proportions to create index scores for SA1s across Australia. The interpretation of index scores and associated output are discussed in SEIFA Measures.
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