Purpose
This report is intended to provide a snapshot of the living standards of New Zealanders. It provides an examination of the range of living standards in the population as a whole, and then provides more detailed inspection of four particular groups (which are not mutually exclusive). These groups (Māori, Pacific, families with dependent children and the low-income population) have been selected because they have featured strongly in public debate on issues of social well-being, and have been a focus of social reporting in New Zealand.
The ELSI scale, which is used for the first time in this analysis, is designed to help fill a gap in tools for living standard measurement.
Methodology
The analysis and results presented in this report are based on data collected in the course of the research project on the living standards of older New Zealanders. As noted in the introduction to this report, that project was initiated by the Super 2000 Taskforce, which commissioned three separate sample surveys. Two were surveys of older New Zealanders: a general sample and a supplementary older Māori sample. In each case, the field data collection was carried out by Statistics New Zealand (SNZ). The third survey was a sample of working-age people with the data being collected by a private survey and research firm, AC Neilson NZ Ltd. For the purposes of the research, older New Zealanders were specified as those aged 65 years and older and working-age people as those aged 18-64 years.
The following gives a summary of the main features of the three surveys.
The older New Zealanders survey (Statistics New Zealand):
- was administered through the Household Labour Force Survey (HLFS) using the HLFS sampling frame;
- included all households containing a person aged 65 years and over who had recently participated in the HLFS in September 1999, or were participating in the HLFS in March 2000 and were eligible for selection;
- selected one eligible person per household;
- was concerned with 'the civilian, usually resident, noninstitutionalised population aged 65 years and over living in permanent private dwellings';
- was conducted between 7 February 2000 and 7 April 2000;
- involved face-to-face interviews about 90 minutes long;
- obtained a sample of 3,060 people aged 65 years and over; and
- achieved a response rate of 68 percent.
The survey of older Māori (Statistics New Zealand):
- used the superannuation database administered by the Department of Work and Income to obtain a sample;
- used a simple random sample of Māori aged 65-69 years;
- selected one eligible person per household and respondents confirmed that they identified themselves as having Māori ethnicity;
- comprised the usually resident, non-institutionalised New Zealand Mäori population aged 65-69 years, living in permanent private dwellings and in receipt of NZS;
- was conducted between 10 April 2000 and 12 June 2000;
- involved face-to-face interviews about 90 minutes long;
- obtained a sample of 542 Mäori aged 65-69 years; and
- achieved a response rate of 63 percent.
The survey of the working-age population (AC Neilson):
- involved house-to-house sampling where only one person per household was interviewed;
- included people aged 18-64 years living in permanent private dwellings;
- was conducted between 11 March 2000 and 18 June 2000;
- involved face-to-face interviews about 40 minutes long;
- obtained a sample of 3,682 people aged 18-64 years; and
- achieved a response rate of 60 percent.
This report is made possible by the development of a living standards measure, applicable to the general population. The Economic Living Standard Index, or ELSI, is based on what people are consuming, their various forms of recreation and social participation, their household facilities and so on, rather than being calculated from the resources (income, financial and assets) that enable them to do those things (Mack and Lansley, 1985; Nolan and Whelan, 1996; Townsend, 1979).
Key Results
Key findings from this report show that:
- There is considerable variation in living standards across different groups.
- Higher average living standards are found amongst:
– those aged 45 years and over (in particular, those aged 65 years and over);
– Europeans;
– those in economic family units without children (i.e. single person or couple only economic family units);
– those who live in the Wellington region or in rural New Zealand;
– those in legislative, administrative, managerial, professional or agricultural occupations;
– those with self-employment income;
– those in receipt of New Zealand Superannuation;
– working-age people in receipt of market income;
– those who own their homes (especially those who own as part of a family trust);
- Higher average living standards are found amongst:
- Lower average living standards are found amongst:
– children (especially those in sole-parent families receiving an income-tested benefit);
– Mäori and Pacific people;
– those in clerical, service, sales, trade or elementary occupations;
– those receiving income-tested benefits;
• There is a strong relationship between living standards and financial position (as indicated by variables such as income, assets and accommodation costs).
• Although the analysis has not been directed towards trying to explain living standard differences, the results indicate that differences are associated with a variety of factors that are interconnected in complex ways. Income is prominent amongst these factors but, of itself, may account for only part of the variation.
Despite the strength of the relationship between living standards and financial position, there is still considerable variation in living standards among those in similar financial circumstances.
- The results provide compelling support for the widely held view that Mäori have below-average living standards.
- The pattern of differences between Mäori population sub-groups isn’t entirely the same as those found for the population overall. A particular difference is that living standard scores for older Mäori are no higher than they are for other Mäori age groups, whereas for the population overall, living standards are higher for older people.
- Of all the major ethnic groups in New Zealand, the Pacific population has the lowest ELSI scores.
- Amongst Pacific people, lower living standards are pronounced at both ends of the life cycle, in childhood and old age.
- The ELSI average for families with dependent children is lower than for the population as a whole. The lower living standards of families with dependent children is primarily a result of the lower living standards of sole-parent families with dependent children who are in receipt of income-tested benefits. Sole-parent families account for approximately 29 percent of all families with dependent children. Of this group, 68 percent are in receipt of income-tested benefits.
- Children with scores at the lower (‘very restricted’ or ‘restricted’) end of the scale (who are predominantly children in sole-parent families) are much more likely than other children to experience constraints that may adversely affect their health, education and general development.
- There is substantial variation in living standards amongst those with low incomes. Of the three low income groups examined (i.e. lowincome receiving NZS, low-income receiving income-tested benefits and low-income receiving market income), those most at risk of lower living standards appear to be those who receive income-tested benefits.
- Low-income New Zealand Superannuitants appear to be more likely to have comfortable living standards while low-income people receiving market income have living standards that (on average) fall between those of Superannuitants and income-tested beneficiaries. Variation between these three groups is associated with differences in housing costs, asset position and income, but these alone do not appear to wholly account for it. Differences in housing tenure and education levels don’t seem to be as strongly associated with living standard differences between the three low-income groups.