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Australia performs very well in many measures of well-being, as shown by the fact that it ranks among the top countries in a large number of topics in the Better Life Index.
Money, while it cannot buy happiness, is an important means to achieving higher living standards. In Australia, the average household net-adjusted disposable income per capita is 31 197 USD a year, more than the OECD average of 23 938 USD a year. But there is a considerable gap between the richest and poorest – the top 20% of the population earn almost six times as much as the bottom 20%.
In terms of employment, over 72% of people aged 15 to 64 in Australia have a paid job, above the OECD employment average of 65%. Some 78% of men are in paid work, compared with 67% of women. People in Australia work 1 728 hours a year, less than most people in the OECD who work 1 765 hours. Another key measure, however, is how many people work very long hours. About 14% of employees work very long hours, much higher than the OECD average of 9%, with 21% of men working very long hours compared with just 6% for women.
Having a good education is an important requisite for finding a job. In Australia, 74% of adults aged 25-64 have earned the equivalent of a high-school degree, close to the OECD average of 75%. This is truer of men than women, as 76% of men have successfully completed high-school compared with 73% of women. This difference is higher than the OECD average and suggests women’s participation in higher education could be strengthened. In terms of the quality of its educational system, the average student scored 512 in reading literacy, maths and science in the OECD’s Programme for International Student Assessment (PISA). This score is higher than the OECD average of 497. On average in Australia, girls outperformed boys by 6 points, slightly below the average OECD gap of 8 points.
In terms of health, life expectancy at birth in Australia is almost 82 years, two years higher than the OECD average of 80 years. Life expectancy for women is 84 years, compared with 80 for men. The level of atmospheric PM10 – tiny air pollutant particles small enough to enter and cause damage to the lungs – is 13.1 micrograms per cubic meter, considerably lower than the OECD average of 20.1 micrograms per cubic meter. Australia also does well in terms of water quality, as 93% of people say they are satisfied with the quality of their water, higher than the OECD average of 84%.
Concerning the public sphere, there is a strong sense of community and high levels of civic participation in Australia, where 93% of people believe that they know someone they could rely on in time of need, higher than the OECD average of 89%. Voter turnout, a measure of public trust in government and of citizens’ participation in the political process, was 93% during recent elections; this figure is the highest in the OECD where the average is 72%. There is little difference in voting levels across society; voter turnout for the top 20% of the population is an estimated 94% and for the bottom 20% it is an estimated 92%, a much narrower difference than the OECD average gap of 11 percentage points and suggesting there is broad social inclusion in Australia’s democratic institutions
In general, Australians are more satisfied with their lives than the OECD average, with 83% of people saying they have more positive experiences in an average day (feelings of rest, pride in accomplishment, enjoyment, etc. ) than negative ones (pain, worry, sadness, boredom, etc.). This figure is higher than the OECD average of 76%.
OECD in Action
OECD Economic Surveys Australia 2014
OECD's 2014 Economic Survey of Australia examines recent economic developments, policies and prospects. Special chapters cover taxes and transfers, and federal-state relations.Read this report
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Australia in Detail
Housing – Australia expand
Living in satisfactory housing conditions is one of the most important aspects of people’s lives. Housing is essential to meet basic needs, such as shelter, but it is not just a question of four walls and a roof. Housing should offer a place to sleep and rest where people feel safe and have privacy and personal space; somewhere they can raise a family. All of these elements help make a house a home. And of course there is the question whether people can afford adequate housing.
Housing costs take up a large share of the household budget and represent the largest single expenditure for many individuals and families, by the time you add up elements such as rent, gas, electricity, water, furniture or repairs. In Australia, households on average spend 20% of their gross adjusted disposable income on keeping a roof over their heads, slightly below the OECD average of 21%.
In addition to housing costs it is also important to examine levels of satisfaction with living conditions, such as the average number of rooms shared per person and whether households have access to basic facilities such as indoor flushing toilets. In Australia, 90% of people say they are satisfied with their current housing situation, more than the OECD average of 87%.
More ResourcesHow's Life? at a Glance
Income – Australia expand
While money may not buy happiness, it is an important means to achieving higher living standards and thus greater well-being. Higher economic wealth may also improve access to quality education, health care and housing.
Household net-adjusted disposable income is the amount of money that a household earns each year after taxes and transfers. It represents the money available to a household for spending on goods or services. In Australia, the average household net-adjusted disposable income per capita is 31 197 USD a year, higher than the OECD average of 23 938 USD.
Household financial wealth is the total value of a household’s financial worth. In Australia, the average household net financial wealth per capita is estimated at 38 482 USD, lower than the OECD average of 42 903 USD. While the ideal measure of household wealth should include non-financial assets (e.g. land and dwellings), such information is currently available for only a small number of OECD countries.
Despite a general increase in living standards across OECD countries over the past fifteen years, not all people have benefited from this to the same extent. In Australia, the average net adjusted disposable income of the top 20% of the population is an estimated 63 087 USD a year, whereas the bottom 20% live on an estimated 11 150 USD a year.
More ResourcesHow's Life? at a Glance
Jobs – Australia expand
Having a job brings many important benefits, including: providing a source of income, improving social inclusion, fulfilling one’s own aspirations, building self-esteem and developing skills and competencies. In Australia, close to 72% of the working-age population aged 15 to 64 has a paid job. This figure is higher than the OECD employment average of 65%. Employment rates are generally higher for individuals with a higher level of education; in Australia an estimated 83% of individuals with at least a tertiary education have a paid job, compared with an estimated 59% for those without an upper secondary education. This 24 percentage point difference is smaller than the OECD average of 33 percentage points and suggests the job market in Australia is relatively inclusive.
Women are still less likely than men to participate in the labour market. In Australia, 67% of women have jobs. This is more than the OECD average of 57% but less than the78% employment rate of men in Australia. This 13 percentage point gender difference is smaller than the OECD average of 16 percentage points and suggests Australia could further improve employment opportunities for women but has generally been successful in addressing the constraints and barriers women face in accessing work.
Young Australians aged 15-24 face an unemployment rate of 11.7% compared with the OECD average of 16.3%.
Unemployed persons are defined as those who are not currently working but are willing to do so and actively searching for work. Long-term unemployment can have a large negative effect on feelings of well-being and self-worth and result in a loss of skills, further reducing employability. In Australia, the percentage of the labour force that has been unemployed for a year or longer is currently at nearly 1.1%, lower than the OECD average of 2.7%. There is little difference on average between men and women in the OECD area when it comes to long-term unemployment – 2.7% for men and 2.8% for women. This is true in Australia, where the long-term unemployment rate for men and women is nearly the same at respectively 1.1% and 1.0%.
The wages and other monetary benefits that come with employment are an important aspect of job quality. In Australia, people earn 46 585 US dollars per year on average, more than the OECD average of 41 010 USD. Not everyone earns that amount however. Whereas the top 20% of the population earn an estimated 60 686 USD per year, the bottom 20% live on an estimated 27 273 USD per year.
Another essential factor of employment quality is job security. Workers facing a high risk of job loss are more vulnerable, especially in countries with smaller social safety nets. In Australia, workers face a 4.4% chance of losing their job, lower than the OECD average of 5.3%.
Better Policies for Better Lives
Choices not Chances
Redbank Plains State High School in southwest Australia, about 30 kilometres from Brisbane, is in a low socio-economic area with a large incidence of recent migrants from the Pacific Islands and New Zealand and a relatively high level of unemployment. In 2011, the school embarked on a concerted effort to transform its performance with the help of state and federal funding. A key part of this effort was recognising that a significant proportion of students would prefer to go straight to work after leaving high school.
Redbank Plains introduced a school-to-work programme called “Choices not Chances to help a culturally diverse school population through senior school years to sustainable employment. A specific focus is to change and challenge a culture of local unemployment through community partnerships and intensive support for students, families and the wider community.
Through the programme, the students increase their knowledge of various industries and develop the skills and habits required to work in them. Local business leaders address students at assemblies and visits are organised to give students a first-hand insight into the world of work. In their final year at school, students have the opportunity to gain direct experience through work experience placements.
A spin-off of the school’s strong focus on transition to work was jobs for parents of Redbank Plains pupils. Through its connection with the school, a local bus company with a persistent recruitment problem discovered that unemployed parents of students at the school would be an ideal source of bus drivers.
More ResourcesWell‑being in the workplace: Measuring job quality
Community – Australia expand
Humans are social creatures. The frequency of our contact with others and the quality of our personal relationships are thus crucial determinants of our well-being. Helping others can also make you happier. People who volunteer tend to be more satisfied with their lives than those who do not. Time spent volunteering also contributes to a healthy civil society. On average, people in Australia spend 6 minutes per day in volunteering activities, higher than the OECD average of 4 minutes per day. Around 65% reported having helped a stranger in the last month, one of the highest scores in the OECD, where the average is of 49%.
A strong social network, or community, can provide emotional support during both good and bad times as well as provide access to jobs, services and other material opportunities. In Australia, 93% of people believe that they know someone they could rely on in time of need, more than the OECD average of 89%. There is a 2 percentage point difference between men and women, as 92% of men believe they have this kind of social support, compared with 94% of women. While on average in the OECD there is a clear relationship between the availability of social support on the one hand, and people’s education level, on the other, in Australia the level of social support is similar across society: around 93% of people who have completed primary education report having someone to count on for help in times of need, compared with 94% for people who attained tertiary education.
A weak social network can result in limited economic opportunities, a lack of contact with others, and eventually, feelings of isolation. Socially isolated individuals face difficulties integrating into society as a contributing member and fulfilling personal aspirations.
More ResourcesHow's Life? at a Glance OECD Insights: Human Capital
Education – Australia expand
A well-educated and well-trained population is essential for a country’s social and economic well-being. Education plays a key role in providing individuals with the knowledge, skills and competences needed to participate effectively in society and in the economy. Having a good education greatly improves the likelihood of finding a job and earning enough money. Across OECD countries, 83% of people with university-level degrees have a job, compared with55% for those with only a secondary school diploma. Lifetime earnings also increase with each level of education.
Following a decline in manual labour over previous decades, employers now favour a more educated labour force. High-school graduation rates therefore provide a good indication of whether a country is preparing its students to meet the minimum requirements of the job market. In Australia, 74% of adults aged 25-64 have earned the equivalent of a high-school degree, close to the OECD average of 75%. This is truer of men than women, as 76% of men have successfully completed high-school compared with 73% of women. This 3 percentage point difference is higher than the OECD average of 1 percentage point and suggests women’s participation in secondary education could be strengthened. Among younger people – a better indicator of Australia’s future – 84% of 25-34 year-olds have earned the equivalent of a high-school degree, higher than the OECD average of 82%.
Australians can expect to go through 18.8 years of education between the ages of 5 and 39, more than the OECD average of 17.7 years. This high level of education expectancy echoes Australia’s good performance in the educational attainment of its 25-34 year-old population.
But graduation rates, while important, speak little to the quality of education received. The OECD’s Programme for International Student Assessment (PISA) reviews the extent to which students have acquired some of the knowledge and skills that are essential for full participation in modern societies. In 2012, PISA focused on examining students’ reading ability, skills in maths and level in sciences, as research shows that these skills are more reliable predictors of economic and social well-being than the number of years spent in school.
The average student in Australia scored 512 in reading literacy, maths and sciences, higher than the OECD average of 497. On average in Australia, girls outperformed boys by 6 points, lower than the average OECD gap of 8 points.
The best-performing school systems manage to provide high-quality education to all students. In Australia, the average difference in results, between the students with the highest socio-economic background and the students with the lowest socio-economic background is of 92 points, slightly lower than the OECD average of 96 points. This suggests the school system in Australia provides relatively equal access to high-quality education.
More ResourcesHow's Life? at a Glance
Environment – Australia expand
The quality of our local living environment has a direct impact on our health and well-being. Outdoor air pollution is one important environmental issue that directly affects the quality of peoples’ lives. Despite national and international interventions and decreases in major pollutant emissions, the health impacts of urban air pollution continue to worsen, with air pollution set to become the top environmental cause of premature mortality globally by 2050. Air pollution in urban centres, often caused by transport and the use of small-scale burning of wood or coal, is linked to a range of health problems, from minor eye irritation to upper respiratory symptoms in the short-term and chronic respiratory diseases such as asthma, cardiovascular diseases and lung cancer in the long-term. Children and the elderly may be particularly vulnerable.
PM10 – tiny particulate matter small enough to be inhaled into the deepest part of the lung – is monitored in OECD countries because it can harm human health and reduce life expectancy. In Australia, PM10 levels are 13.1 micrograms per cubic meter, lower than the OECD average of 20.1 micrograms per cubic meter and the annual guideline limit of 20 micrograms per cubic meter set by the World Health Organization.
Access to clean water is fundamental to human well-being. Despite significant progress in OECD countries in reducing water pollution, improvements in freshwater quality are not always easy to discern. In Australia, 93% of people say they are satisfied with water quality, higher than the OECD average of 84%.
More ResourcesHow's Life? at a Glance OECD Environmental Outlook to 2030
Governance – Australia expand
Trust in government is essential for social cohesion and well-being. In Australia, 46% of people say they trust their national government, more than the OECD average of 39%. High voter turnout is another measure of public trust in government and of citizens’ participation in the political process. In the most recent elections for which data is available, voter turnout in Australia was 93% of those registered; this figure is the highest in the OECD area where average voter turnout is 72%.
While voter turnout is indeed compulsory (and strongly enforced) in Australia, it is nevertheless a useful measure of citizen engagement. In the context of the Better Life Index, voter turnout measures how civic engagement contributes to the well-being of people and society. From this perspective, the Australian political system performs well in the sense that it reflects the will of a very large number of individuals (irrespective of what drives high participation).
There is little difference in the voting rates of men and women in most OECD countries. This is the case in Australia, where voter turnout is nearly the same for men and women. While on average there are few differences between men and women concerning participation in elections, income can have a strong influence on voter turnout. In Australia, because voter turnout is compulsory, participation is high across all income groups. Voter turnout for the top 20% of the population is an estimated 94%, slightly above the estimated 92% participation rate of the bottom 20%. This 2 percentage point difference, much lower than the OECD average difference of 11 percentage points, and suggests there is broad social inclusion in Australia’s democratic institutions.
Ensuring that government decision making is not compromised by conflicts of interest is key to maintaining trust in government. Transparency is therefore essential to hold government to account and to maintain confidence in public institutions.
Freedom of information laws (FOI) allow the possibility for individuals to access undisclosed information. For such policies to be successful, the public should have a clear understanding of their rights under the law, should be able to file requests with ease and should be protected against any possible retaliation. People in Australia can file a request for information either in writing, online, or in person – thus greatly facilitating the FOI process. However, there are no provisions for anonymity or protection from retaliation.
Better Policies for Better Lives
A “Declaration of Open Government”
Australia is committed to more open government, built around three key principles: strengthening access to information, collaborating with citizens on policy and service delivery and making government more consultative and participative. This includes making more use of Internet to engage with the public and being proactive in sharing information.
Public consultation in decision-making is an essential part of the open government process. Thus, the National Compact, which aims to strengthen the working relationship between the federal government and the not-for-profit sector, was developed following extensive consultations between the government and the sector.
More ResourcesHow's Life? at a Glance
Health – Australia expand
Most OECD countries have enjoyed large gains in life expectancy over the past decades, thanks to improvements in living conditions, public health interventions and progress in medical care. Life expectancy at birth in Australia stands at 82 years, two years above the OECD average of 80 years. Life expectancy for women is 84 years, compared with 80 for men, a slightly smaller difference than the average OECD gender gap of six years, with a life expectancy of 83 years for women and 77 years for men.
Higher life expectancy is generally associated with higher healthcare spending per person, although many other factors such as living standards, lifestyles, education and environmental factors have an impact on life expectancy. Total health spending accounts for 8.9% of GDP in Australia, less than the 9.4% OECD average. However, Australia ranks above the OECD average in terms of total health spending per person, at 3 800 USD in 2010, compared with an OECD average of 3 322 USD. Between 2000 and 2009, total health spending in Australia increased in real terms by 4.2% per year on average, a growth rate similar to the OECD average of 4.0%.
Throughout the OECD, tobacco consumption and excessive weight gain remain two important risk factors for many chronic diseases. Australia provides an example of a country that has achieved remarkable progress in reducing tobacco consumption, cutting by more than half the percentage of adults who smoke daily from 35.4% in 1983 to 15.1% today. The smoking rate among adults in Australia is now one of the lowest in the OECD, behind only Iceland, Sweden and the United States. Much of the decline in Australia can be attributed to policies aimed at reducing tobacco consumption through public awareness campaigns, advertising bans and increased taxation.
In many OECD countries, large proportions of the population are overweight or obese. In Australia, the obesity rate among adults is 28.3%, higher than the OECD average of 17.2%. Obesity rates are high in Australia, and they have been increasing faster than in most other OECD countries over the last 20 years. Obesity’s growing prevalence foreshadows increases in the occurrence of health problems such as diabetes, cardiovascular diseases and asthma, and higher health care costs in the future.
When asked, “How is your health in general?” 85% of people in Australia said they were in good health, higher than the OECD average of 69%. Despite the subjective nature of this question, answers have been found to be a good predictor of people’s future health care use. Gender, age and social status may affect answers to this question. On average in OECD countries, men are more likely to report good health than women, with an average of 72% for men and 67% for women. In Australia, however, there is no difference between men and women. Not surprisingly, older people report poorer health, as do those who are unemployed, or who have less education or income. About 93% of adults with a disposable income in the top 20% in Australia rate their health as ‘good’ or ‘very good’, compared to about 75% for those with a disposable income in the bottom 20%.
Better Policies for Better Lives
Improving the healthcare system
Australia’s universal health care system is one of the best in the world. The rapidly growing ageing population and the increasing frequency of chronic conditions, however, are increasing its cost.
The ambitious national eHealth agenda aims to increase consumers’ engagement and control over their medical information. It includes the development of a Personally Controlled Electronic Health Record (PCEHR), a digital web-based collection of a patient’s medical history. It would include copies of medical records, reports about diagnosed medical conditions, medication, vital signs, immunisations, laboratory results, and personal characteristics like age and weight.
The introduction of a PCEHR for each Australian is an important opportunity to improve the quality and safety of health care, reduce waste and inefficiency, and improve continuity and health outcomes for patients. Giving people better access to their own health information through a PCEHR is also essential to promoting consumer participation, and supporting self-management and informed decision-making.
More ResourcesHow's Life? at a Glance
Life Satisfaction – Australia expand
Happiness or subjective well-being can be measured in terms of life satisfaction, the presence of positive experiences and feelings, and the absence of negative experiences and feelings. Such measures, while subjective, are a useful complement to objective data to compare the quality of life across countries.
Life satisfaction measures how people evaluate their life as a whole rather than their current feelings. It captures a reflective assessment of which life circumstances and conditions are important for subjective well-being. When asked to rate their general satisfaction with life on a scale from 0 to 10, Australians gave it a 7.4 grade, higher than the OECD average of 6.6.
There is little difference in life satisfaction levels between men and women across OECD countries. This is true in Australia, where men gave their life a 7.2 grade, only slightly lower than the 7.5 grade given by women. Education levels, however, influence subjective well-being. Whereas people who have only completed primary education in Australia have a life satisfaction level of 6.9, this score reaches 7.5 for people with tertiary education.
Happiness, or subjective well-being, is also measured by the presence of positive experiences and feelings, and/or the absence of negative experiences and feelings. In Australia, 83% of people reported having more positive experiences in an average day (feelings of rest, pride in accomplishment, enjoyment, etc.) than negative ones (pain, worry, sadness, boredom, etc.). This figure is higher than the OECD average of 76%.
More ResourcesHow's Life? at a Glance
Safety – Australia expand
Personal security is a core element for the well-being of individuals, and largely reflects the risks of people being physically assaulted or falling victim to other types of crime. Across the OECD, assault rates have generally declined in the past five years. In Australia, 2.1% of people reported falling victim to assault over the previous 12 months, less than the OECD average of 3.9%. There is little difference between men and women in assault rates, at 2.5% for men and 1.7% for women.
The homicide rate (the number of murders per 100,000 inhabitants) is a more reliable measure of a country’s safety level because, unlike other crimes, murders are usually always reported to the police. According to the latest OECD data, Australia’s homicide rate is 0.8, lower than the OECD average of 4.1. The homicide rate for men is 1.1 compared with 0.6 for women.
Fear of crime is another important indicator as it can constrain behaviour, restrict freedom and threaten the foundation of communities. Despite a general reduction in assault rates in the past five years, in many OECD countries feelings of security have declined. In Australia, 67% of people feel safe walking alone at night, slightly lower than the OECD average of 69%. While men are at a greater risk of being victims of assaults and violent crimes, women report lower feelings of security than men. This has been explained by a greater fear of sexual attacks, the feeling they must also protect their children and their concern that they may be seen as partially responsible.
More ResourcesHow's Life? at a Glance
Work-Life Balance – Australia expand
Finding a suitable balance between work and life is a challenge for all workers, especially working parents. Some couples would like to have (more) children, but do not see how they could afford to stop working. Other parents are happy with the number of children in their family, but would like to work more. This is a challenge to governments because if parents cannot achieve their desired work/life balance, not only is their welfare lowered but so is development in the country.
People spend one-tenth to one-fifth of their time on unpaid work. The distribution of tasks within the family is still influenced by gender roles: men are more likely to undertake more hours of paid work, while women spend longer in unpaid domestic work. Men in Australia, spend 172 minutes per day cooking, cleaning or caring, one of the highest scores across OECD countries but less than Australian women who spend 311 minutes per day on average on domestic work.
An important aspect of work-life balance is the amount of time a person spends at work. Evidence suggests that long work hours may impair personal health, jeopardize safety and increase stress. People in Australia work on average 1 728 hours a year, less than the OECD average of 1 765 hours. Another key measure, however, is how many people work very long hours. The share of employees working 50 hours or more per week is not very large across OECD countries. In Australia, however, more than 14% of employees work very long hours, much more than the OECD average of 9%. Overall, men spend more hours in paid work: in Australia 21% of men work very long hours, compared with 6% for women.
The more people work, the less time they have to spend on other activities, such as time with others or leisure. The amount and quality of leisure time is important for people’s overall well-being, and can bring additional physical and mental health benefits. In Australia, full-time workers devote 60% of their day on average, or 14.4 hours, to personal care (eating, sleeping, etc.) and leisure (socialising with friends and family, hobbies, games, computer and television use, etc.) – less than the OECD average of 15 hours. Fewer hours in paid work for women do not necessarily result in greater leisure time. In Australia, both men and women devote approximately 14 hours per day to personal care and leisure.
Better Policies for Better Lives
Helping single parents find paid work
Australia performs well on a number of important outcomes of work-life balance: fertility (1.9 children per women) is above the OECD average (1.7), the female employment rate (66.6%) has been rising steadily since the 1960s and is now well above OECD average (57%), and the gender wage gap (16%) is close to the OECD average (15%). Unlike many other OECD countries, mothers often return to full-time work once their children reach schooling age.
However, joblessness among sole parent families is a significant problem. At just over 50% in 2009 the sole-parent employment rate is one of the lowest in the OECD, which contributes to an above average poverty rate for sole-parent families. This issue is of particular concern as around one in five children live in such households, and projections show that the number is likely to increase by 20% over the next 25 years. Australian policy should therefore continue to support work, training or job search requirements for recipients of sole-parent benefits.
Australia does well for most of its children as measured by outcomes within the three key dimensions of material well-being, education and health. The child poverty rate has fallen over the last 10 years and is now close to the OECD average, PISA reading scores are above the OECD average, older children are less likely to be out of education or employment, and the incidence of infant deaths has also seen a large decline.
Despite above average public expenditure on families, Australia spends less on childcare services than most OECD countries: 0.6% of GDP compared with the OECD average of 0.7%. This has contributed to low childcare enrolment rates for young children, with only 33% of children aged less than three years enrolled in formal childcare. Australia should consider extending its childcare support programmes to provide more help to working parents.