Factors Associated with the Labour Force Participation of Prime-age Indigenous Australians

Increasing the employment-to-population ratio of Aboriginal and Torres Strait Islander people aged 25-64 to 62% by 2031 is one of the key targets of the new Closing the Gap Agreement. This requires not only creating employment opportunities for Indigenous Australians who are actively seeking work, but also encouraging those who are not in the labour force to join the labour market. Survey data show a high prevalence of labour market disengagement among prime-age Indigenous Australians (aged 2554 years). People in this demographic group are at their most productive in terms of their working lives, and their absence from the labour market has important implications. Identifying those who are genuinely unable to work (for example due to permanent disablement) from those who would be available to work if conditions were right for them is vital for a well-targeted policy. Yet little is known about the underlying characteristics of prime-age people not in the labour force. Drawing on data from a relatively recent nationally representative survey, this study finds that disability, education and history of incarceration are the three most important driving factors for both male and female Aboriginal and Torres Strait Islander labour force participation.