The dynamics of income poverty in Australia: Evidence from the first three waves of the HILDA Survey

Abstract

This paper reports an analysis of income poverty dynamics in Australia using longitudinal data from the first three waves of the Household, Income and Labour Dynamics in Australia (HILDA) Survey. As in other developed countries, far fewer people are found to be living in persistent poverty than are poor on an annual basis. With a poverty threshold set at 50 per cent of median equivalised income, just over four per cent of Australians were measured as being in income poverty in all three waves. Among those who were poor during 2000‐01, about half subsequently had incomes above the 50 per cent threshold. However, the longer people remained in poverty, the less likely they were to exit, the greater was their risk of re‐entering poverty, and the lower were their incomes if they temporarily escaped poverty.