Socio-Economic Indexes for Areas (SEIFA)

Measuring socioeconomic disadvantage

The Australian Bureau of Statistics (ABS) has produced measures of socioeconomic disadvantage since the 1971 Census. The Socio-Economic Indexes for Areas (SEIFA) were first produced in 1990 and consisted of five indexes formed from the 1986 Census data (Adhikari, 2006).

There are four SEIFA indexes currently produced. In each census year, the ABS assigns index SEIFA scores to non-overlapping geographical areas covering all Australia calculated from the various socioeconomic characteristics from the Census of the people living in areas.

Each index is a summary of a different subset of Census variables and focuses on a different aspect of socioeconomic advantage and disadvantage (ABS, 2023). The reference value for the whole of Australia is set to 1,000. Lower values indicate lower socioeconomic status.

The indexes are:

• Index of Relative Socio-Economic Disadvantage (IRSD)

• Index of Relative Socio-Economic Advantage and Disadvantage (IRSAD)

• Index of Economic Resources (IER)

• Index of Education and Occupation (IEO).

The score for each index is an ordinal measure with a mean of 1000 and standard deviation of 100 for Australia, and from 2011, based on the index scores of all Statistical Areas Level 1 (SA1) in Australia. Scores for larger geographic areas such as Local Government Areas (LGAs) and Postal Areas (POA) are population-weighted averages of scores in constituent SA1.

The overall scores for states are not available because as the size of an area increases, it becomes correspondingly more heterogeneous and the socioeconomic index becomes less and less meaningful. For very large areas, it is more useful to look at the distribution of SA1 scores within each area. The distributions of SA1 scores within each state and territory are available at the ABS web site (ABS 2023).

The ABS has released SEIFA scores after the last six censuses. The methods used to calculate scores were similar in 1986, 1991 and 1996, but changed in 2001, 2006 and 2011. The major change in 2006 was that the census data used in the calculation of the indexes was based on people's usual area of residence rather than their location on census night (place of enumeration) and in 2011 a new geography standard was used and the proportion of Aboriginal people was no longer a constituent variable of IRSD (ABS 2013). Between SEIFA 2011 and SEIFA 2016 the main change was updates to SA1 boundaries in many areas (ABS 2018). Between SEIFA 2016 and SEIFA 2021 the changes were the updating of the Australian and New Zealand Standard Classification of Occupations (ABS 2023); removal of dwelling internet connection and updating of income cut-off values (ABS 2023b).

The four SEIFA indexes in 2021

The Index of Relative Socio-Economic Disadvantage (IRSD), is a general socio-economic index that provides summary information about the economic and social conditions of people and households in the area. There are currently 15 variables contributing to the index that relate to employment, income, occupation, education, household type, level of speaking english, and the economic resources of the household. This is the most frequently used and quoted SEIFA index. It is used extensively throughout the HealthStats NSW website. 

The Index of Relative Socio-Economic Advantage and Disadvantage (IRSAD) consists of 23 contributing variables. They summarise information about the economic and social conditions of people and households within an area, including both relative advantage and disadvantage measures.

A low IRSAD score indicates relatively greater disadvantage and a lack of advantage in general. For example, an area could have a low score if there are (among other things) many households with low incomes, or many people in unskilled occupations. A high IRSAD score indicates a relative lack of disadvantage and greater advantage in general. For example, an area may have a high score if there are (among other things) many households with high incomes, or many people in skilled occupations (ABS 2023)

The Index of Economic Resources (IER) focuses on the financial aspects of relative socio-economic advantage and disadvantage, by summarising variables related to income and housing. Education and occupation variables are excluded from this index because they are not direct measures of economic resources. Some relevant data on assets such as savings or equities are also not included because this information was not collected in the Census. There are 8 contributing variables. (ABS 2023)

The Index of Education and Occupation (IEO) is designed to reflect the educational and occupational level of communities. The education variables in this index show either the level of qualification achieved or whether further education is being undertaken. The occupation variables classify the workforce into the major groups and skill levels of the Australian and New Zealand Standard Classification of Occupations (ANZSCO) and the unemployed. This index does not include any income variables. There are 8 variables contributing to the total score. (ABS 2023)

Quintiles of socioeconomic status in HealthStats NSW

Socioeconomic disadvantage is associated with a higher prevalence of health risk factors and higher rates of hospitalisations, deaths and other adverse health outcomes. Maps of socioeconomic disadvantage by LGA viewed in conjunction with maps of health outcomes can assist in identifying factors which may be associated with poorer outcomes.

The NSW population was divided into five groups based on the IRSD scores of their SA2 of residence. This means that SA2s were sorted by IRSD score and assigned to population-weighted quintiles, each containing close to one-fifth of the total population. In some charts and data tables on HealthStats NSW, the quintiles were divided into three groups: the lowest SES population-weighted quintile, the highest SES population-weighted quintile, and the rest of the population, comprising the remaining three population-weighted quintiles.

Analysis of NSW Population Health Survey data by quintiles of socioeconomic status in HealthStats NSW

Postal Areas (POAs) were grouped into quintiles of socioeconomic status based on the IRSD.

References

Adhikari P. Socio-economic indexes for areas: Introduction, use and future directions. ABS Catalogue no. 1351.0.55.015. Canberra: ABS, 2006.

Australian Bureau of Statistics. Socio-Economic Indexes for Areas (SEIFA) - Technical Paper, 2011. SEIFA Cat no 2033.0.55.001. Canberra: ABS, 2013.

Australian Bureau of Statistics. Socio-Economic Indexes for Areas (SEIFA) - Technical Paper, 2016. SEIFA Cat no 2033.0.55.001. Canberra: ABS, 2018.

Australian Bureau of Statistics. 1996 Census of population and housing. Socioeconomic indexes for areas. 2039.0. Canberra: ABS, 1998. Available at http://www.ausstats.abs.gov.au/ausstats/free.nsf/0/C17E9A880591BB45CA256AE9001BCD57/$File/2039.0_1996.pdf

Australian Bureau of Statistics. Census of Population and Housing: Socio-Economic Indexes for Areas (SEIFA), Australia, 2016. Catalogue no 2033.0.55.001. Canberra: ABS, 2013. Available at http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/2033.0.55.001~2016~Main%20Features~SOCIO-ECONOMIC%20INDEXES%20FOR%20AREAS%20(SEIFA)%202016~1

Australian Bureau of Statistics 2023 Socio-economic Indexes for Areas (SEIFA), Australia https://www.abs.gov.au/statistics/people/people-and-communities/socio-economic-indexes-areas-seifa-australia/latest-release accessed on 22/4/2024

Australian Bureau of Statistics 2023 Socio-economic Indexes for Areas (SEIFA), Australia methodology https://www.abs.gov.au/methodologies/socio-economic-indexes-areas-seifa-australia-methodology/2021 accessed on 22/4/2024

Australian Bureau of Statistics 2023 Socio-economic Indexes for Areas (SEIFA): Technical Paper https://www.abs.gov.au/statistics/detailed-methodology-information/concepts-sources-methods/socio-economic-indexes-areas-seifa-technical-paper/2021 accessed on 22/4/2024