2.07 Employment

Key messages

Why is it important?

Employment is a powerful driver of health, wellbeing and economic empowerment for Aboriginal and Torres Strait Islander (First Nations) people. It enables individuals to achieve economic self-determination and financial security, which are closely linked to improved mental health and reduced psychological distress. Employment also contributes to breaking cycles of poverty and trauma, particularly for First Nations women. The significance of employment in fostering long-term equity and resilience is reflected in Closing the Gap Targets 7 and 8, which aim to increase youth engagement in employment, education or training to 67 per cent, and adult employment to 62 per cent by 2031.

Data findings

• In 2021, 60% (289,700) of First Nations people aged 15–64 were participating in the labour force (that is, employed or unemployed and looking for work), and 52% (253,600) were employed, an increase from 47% in 2016.

• First Nations people aged 15–64 had a lower labour force participation rate than non-Indigenous Australians (60% compared with 79%) and a lower employment rate (52% compared with 75%). The gap in employment between First Nations people and non-Indigenous Australians was substantially lower in the public sector than in the private sector.

• Across the states and territories, the employment rate for First Nations people aged 15–64 ranged from 31% (12,000 people) in the Northern Territory to 69% (4,000) in the Australian Capital Territory.

• The employment rate was lower in more remote areas. In 2021, the employment rate for First Nations people aged 15–64 was highest in Major cities at 58% (117,700 people) and lowest in Very remote areas at 32% (15,200).

• The proportion of First Nations people aged 15–24 who were fully engaged in employment, education or training increased from 57% in 2016 to 58% in 2021.

• For First Nations people aged 25–64 (Closing the Gap target), the employment rate increased from 51% in 2016 to 56% in 2021, and the gap between First Nations and non-Indigenous employment rates reduced from 24.7 to 22.0 percentage points.

• Between 2016 and 2021, the unemployment rate for First Nations people aged 25–64 decreased from 15% to 10%, as did the gap between First Nations and non-Indigenous unemployment rates (from 9.7 percentage points to 6.0 percentage points).

• In 2022–23, for First Nations people aged 15 and over who were not in the labour force, the main reasons given for not looking for a job included having a long-term health condition or disability (20%, 13,300 people), childcare (19%, 13,200), and studying or returning to study (13%, 8,800).

• In 2022–23, 3.8% of First Nations people aged 18–64 reported long-term unemployment (52 weeks or more). The proportion was lower in non-remote areas (3.1%) and higher in remote areas (8.1%).

Research and evaluation findings

• First Nations people face greater barriers to employment, including a lack of access to high-quality and relevant training, limited access to supportive workplaces, inconsistent mentoring for young First Nations job seekers and few long-term job opportunities. More frequent interactions with the justice system and living in remote areas also present additional barriers limiting employability and access to employment opportunities.

• Evaluations reveal that involving First Nations people in program design and building culturally safe employment opportunities are effective strategies. However, there is a need to improve community control, governance structures, and communication for even better outcomes.

• Driving Change, a driver licensing support program delivered in 11 Aboriginal communities in New South Wales, was found to be effective in improving employment outcomes for those who gained a licence. Participants who gained an independent licence were 2.5 times as likely to report a new job or change in job in the 6 months following the program.

• First Nations-owned and led businesses deliver stronger outcomes for First Nations employees by embedding cultural competence through Indigenous governance, fostering supportive environments that address racism and uphold cultural and family obligations, which in turn enhances staff retention and attraction. 

Implications

A range of approaches have the potential to improve employment outcomes and economic empowerment for First Nations people, including skills development, tailored pre-employment training, intensive job seeker support, non-standard recruitment strategies, retention initiatives, wage subsidies, and public service employment targets. Structural reforms across housing, transport, education, and health services also play a role. Evaluations consistently highlight the importance of community-led employment pathways, culturally safe workplaces, and local control over program design and delivery. Government initiatives such as Workforce Australia, the Indigenous Skills and Employment Program, and the Remote Australia Employment Service (RAES) reflect this more tailored approach, but further progress depends on embedding cultural safety, supporting community-controlled sectors and First Nations businesses. These efforts are essential to closing the employment gap, fostering economic empowerment and long-term wellbeing.

Why is it important?

Employment and health are interconnected. Employment is beneficial for individual and community health as it boosts financial security, standards of living, social mobility, social status, personal development, social relations, self-esteem and emotional wellbeing (Lowry and Moskos 2007; Marmot et al. 2008; Parliament of Australia 2024). Employment opportunities enable Aboriginal and Torres Strait Islander (First Nations) individuals to achieve economic self-determination, which is a key measure of their overall wellbeing (Parliament of Australia 2024). Workforce participation rates are also considerably higher for people with better health, particularly better mental health (Hunter et al. 2022).

Employment and financial security are key drivers of better mental health outcomes, with employed First Nations people half as likely to have high or very high levels of mental distress than those who are unemployed (Hunter et al. 2022). Employment leads to a measurable reduction in suicidal behaviour for First Nations people (Dudgeon et al. 2016). Employment has the capacity to break cycles of poverty and trauma that impact First Nations people, especially women (Evans 2021). 

The type of employment, and conditions in the workplace, can change the impact employment has on health. A lack of cultural competency in the workplace has a substantial effect on the overall health and wellbeing of First Nations employees in Australia, including a notable detrimental impact on mental health (Evans 2021). Culturally safe and secure employment can support broader social determinants of health and improve access to health services by increasing incomes. 

While relatively poor health is a major contributor to lower labour market attachment for First Nations people (Kalb et al. 2012), being disabled, or caring for someone in poor health are also barriers to labour force participation (Belachew and Kumar 2014). 

The National Agreement on Closing the Gap (the National Agreement) was developed in partnership between Australian governments and the Coalition of Aboriginal and Torres Strait Islander Peak Organisations. It is built around 4 Priority Reforms directly informed by First Nations people. These reforms aim to change how governments work with First Nations people by fostering partnership and shared decision-making, building the Aboriginal community-controlled sector, transforming government organisations, and improving and sharing access to data and information to enable informed decision making by First Nations communities. The National Agreement identifies the importance of ensuring there is strong economic participation and development for both First Nations people and their communities, and to ensure First Nations youth are engaged in employment or education.

• Target 7: By 2031, increase the proportion of Aboriginal and Torres Strait Islander youth (15–24 years) who are in employment, education or training to 67 per cent (compared with a 2016 baseline level of 57 per cent).
• Target 8: By 2031, increase the proportion of Aboriginal and Torres Strait Islander people aged 25–64 who are employed to 62 per cent (compared with a 2016 baseline level of 51 per cent).

For the latest data on the Closing the Gap targets, see the Closing the Gap Information Repository.

Employment is interconnected with other social determinants of health, such as education (see measures 2.04 Literacy and numeracy, 2.05 Education outcomes for young people and 2.06 Educational participation and attainment of adults), income (see measure 2.08 Income), and the socioeconomic environment (see measure 2.09 Socioeconomic indexes). By addressing these interconnected factors, employment can significantly contribute to the overall health and wellbeing of First Nations people, fostering a more equitable society.

Labour force participation and employment

Data presented in this section are from the 2021 ABS Census of Population and Housing. People for whom labour force status was not stated were excluded prior to calculating percentages.

Note that the Census was held on 10 August 2021, during which most states and territories in Australia were under restrictions due to the COVID-19 pandemic.

In the 2021 Census, information on labour force status was collected for around 485,500 First Nations people aged 15–64. Based on these data, about 289,700 (60%) First Nations people aged 15–64 were in the labour force, consisting of:

• 253,600 (52% of those aged 15–64) who were employed
• 36,000 (7%) who were looking for work (unemployed) (Table D2.07.3).

The labour force participation rate was slightly higher for First Nations males than females (62%, compared with 58%) (Table D2.07.4, Figure 2.07.1). 

Figure 2.07.1: Labour force status, First Nations people aged 15–64, by sex, 2021

Note: Data shown are calculated using the total number of First Nations people aged 15–64 as the denominator, excluding those for whom labour force status was unknown. The proportion who were unemployed as presented in this figure differs to the ‘unemployment rate’ which is calculated using the number of First Nations people aged 15­–64 in the labour force as the denominator (see ‘Unemployment rate’ section).

Source: Table D2.07.4. AIHW analysis of ABS Census of Population and Housing.

Among First Nations people aged 15–64:

• the labour force participation rate was highest for those aged 25–34 and 35–44 (both 65%), as were employment rates (both 58%)
• those aged 55–64 had the lowest labour force participation rate (51%), followed by those aged 15–24 (54%)
• younger people aged 15–24 had the lowest employment rate (44%), followed by those aged 55–64 (46%) (Table D2.07.3, Figure 2.07.2). 

Figure 2.07.2: Employment and labour force participation rate, First Nations people aged 15–64, by age group, 2021

Note: Data shown are calculated using the number of First Nations people in the specified age group as the denominator, excluding those for whom labour force status was unknown.

Source: Table D2.07.3. AIHW analysis of ABS Census of Population and Housing.

Across the states and territories, the employment rate for First Nations people aged 15–64 in 2021 ranged from 31% (about 12,000 people) in the Northern Territory to 69% (4,000) in the Australian Capital Territory (Table D2.07.5, Figure 2.07.3). 

Figure 2.07.3: Employment rate, First Nations people aged 15–64, by jurisdiction, 2021

Note: Data are calculated using the number of First Nations people aged 15–64 in the specified jurisdiction as the denominator, excluding those for whom labour force status was unknown.

Source: Table D2.07.5. AIHW analysis of ABS Census of Population and Housing.

In 2021, the employment rate for First Nations people aged 15–64 was highest in Major cities (58%, about 117,700 people). This was followed by Inner regional areas (55%, 64,500), Outer regional areas (51%, 44,800) and Remote areas (42%, 11,400). The lowest employment rate was in Very remote areas at 32% (15,200). In Very remote areas, 59% of First Nations people aged 15–64 were not in the labour force, followed by 51% in Remote areas (Table D2.07.6, Figure 2.07.4). 

Figure 2.07.4: Labour force status of First Nations people aged 15–64, by remoteness, 2021

Note: Data are calculated using the number of First Nations people aged 15–64 in the specified remoteness area as the denominator, excluding those for whom labour force status was unknown.

Source: Table D2.07.6. AIHW analysis of ABS Census of Population and Housing.

Of First Nations people aged 15–64 in 2021, 29% (about 142,000) were employed full-time, and 17% (about 84,400) were employed on a part-time basis (Table D2.07.3).

Based on data from the last 3 censuses, the proportion of First Nations people aged 15–64 who were employed was similar in 2011 and 2016 (46% and 47% respectively), increasing to 52% in 2021 (Table D2.07.18, Figure 2.07.5). For First Nations people aged 25–64, the employment rate increased from 51% in 2016 to 56% in 2021 (Table D2.07.18).

Note that trends over time in employment, particularly in remote areas, should be interpreted with caution. Comparability over time is impacted by the transition from the Community Development Employment Program (CDEP) (in which participants were counted as employed in the 2011 Census) to the Community Development Program (CDP) (in which participants were not counted as employed in 2016 unless holding another non-CDP job). At the same time, First Nations specific employment initiatives (such as the Indigenous Rangers Program and ACCHS health workforce) have a larger impact on employment in remote areas, particularly within the Health Care and Social Assistance and Public Administration and Safety industries.

Figure 2.07.5: Labour force status, First Nations people aged 15–64, 2011, 2016 and 2021

Note: Data shown are calculated using the total number of First Nations people aged 15–64 as the denominator, excluding those for whom labour force status was unknown. The proportion who were unemployed as presented in this figure differs to the ‘unemployment rate’, which uses the number of First Nations people aged 15­–64 in the labour force as the denominator (see ‘Unemployment rate’ section).

Source: Table D2.07.18. AIHW analysis of ABS Census of Population and Housing.

Unemployment rate

‘Unemployment rate’ is defined as the number of people who are unemployed as a proportion of those in the labour force. 

Based on the 2021 Census, the unemployment rate among First Nations people aged 15–64 was 12% (around 36,000 of 289,700 people) (Table D2.07.3). First Nations males aged 15–64 had a higher unemployment rate than First Nations females (13.5% compared with 11.3%) (Table D2.07.4).

Among First Nations people aged 25–64, the unemployment rate was 10% in 2021 (about 21,100 of 209,900 people) (Table D2.07.3). The unemployment rate for First Nations males aged 25–64 was 10.8%, compared with 9.2% for females (Table D2.07.4).

The 2022–23 National Aboriginal and Torres Strait Islander Health Survey (NATSIHS) showed that 3.8% of First Nations people aged 18–64 reported long-term unemployment (52 weeks or more). The proportion was lower in non-remote areas (3.1%) and higher in remote areas (8.1%) (Table D2.07.7). 

In the 2022–23 NATSIHS, 43% of unemployed First Nations people aged 15–64 reported having high or very high levels of psychological distress in the past month (19,100 out of 44,700 unemployed persons), compared with 25% of those who were employed (79,200 out of 314,300 employed persons) (Table D2.07.13). It must be noted however, that the 43% estimate has a high margin of error and should be interpreted with caution.

Reasons for not being in the labour force

The 2022–23 NATSIHS showed that for First Nations people aged 15 and over who were not in the labour force (excluding those who do not want a job, or are permanently unable or not intending to work) the main reasons for not looking for a job included:

• having a long-term health condition or disability (20%, 13,300 people)
• childcare (19%, 13,200)
• studying or returning to study (13%, 8,800)
• no jobs in locality or in line of work (12%, 8,400)
• other family considerations (12%, 8,200) (Table D2.07.11).

Research has shown that many of those not in the labour force in remote areas are still engaged in productive activities supporting their community (Altman et al. 2005).

Health conditions and labour force status

In the 2021 Census, people were asked whether they had been told by a doctor or nurse that they had any of a selected list of 10 long-term health conditions, as well as the option of choosing ‘any other long-term health condition’. First Nations people aged 25–64 who reported having a long-term health condition had a lower employment rate than those with no long-term conditions (ranging from 17% to 53% for those with a long-term health condition, compared with 65% for those without) (Table 2.07.20, Figure 2.07.6). 

Figure 2.07.6. Employment rate for First Nations people aged 25–64, by selected long-term health conditions, 2021

Source: Table 2.07.20. AIHW analysis of ABS Census of Population and Housing.

Disability, unpaid carers and labour force status

Based on the 2021 Census, 26,800 of First Nations people aged 25–64 required assistance with core activities, while 296,600 did not (excludes people for whom Indigenous status and/or need for assistance were unknown). The employment rate among First Nations people aged 25–64 who needed assistance with core activities was 14%, compared with 62% among those who did not need assistance (Table D2.07.21).

In 2021, First Nations people aged 15 and over who provided unpaid assistance to a person with disability, illness or due to old age were less likely to be in the labour force than other First Nations people (56% compared with 58%) (Table D1.14.26).

Educational attainment and employment

Educational attainment is associated with employment outcomes, with people who have completed tertiary level education generally having better employment opportunities than those who have not completed further education after leaving school (National Skills Commission 2021).

In 2021, the proportion of First Nations people aged 25–64 who were employed increased with each level of educational attainment. For example, among First Nations people aged 25–64, 85% (29,100) of those whose highest level of education was a Bachelor Degree or higher were employed, compared with 72% (59,700) of those with a Certificate III or IV level qualification, 45% (57,500) of those with a secondary education at Year 10 to 12 level, and 24% (9,600) of those with lower levels of qualification (Year 9 or below, or no educational attainment) (Table D2.07.22, Figure 2.07.7). 

Figure 2.07.7:  Employment rate for First Nations people aged 25–64, by highest level of educational attainment, 2021

Source: Table D2.07.19. AIHW analysis of ABS Census of Population and Housing.

A similar pattern was observed across remoteness area of usual residence, with generally higher employment rates at higher levels of educational attainment (Table D2.07.22). Among First Nations people aged 25–64 in 2021:

• for people with higher levels of education including Certificate III and IV, Advanced Diploma and Diploma level and Bacher Degree and above, the employment rates were very similar in remote and non-remote areas
• for people whose highest level of educational attainment was Year 10 and above, Year 9 and below or no educational attainment, employment rates were much higher in non-remote areas than in remote areas (Table D2.07.22).

The National Agreement on Closing the Gap specifies a target to increase the proportion of First Nations people aged 15–24 engaged in employment, education or training to 67% by 2031. 

According to the 2021 Census, the proportion of First Nations people aged 15–24 who were fully engaged in employment, education or training was 58% (80,500 of 138,800 people) (Productivity Commission 2023). This was an increase from 57% in 2016 (the baseline year).

Employment by occupation

Data from the 2021 Census of Population and Housing showed that, among employed First Nations people aged 25–64:

• 18% (32,100) were community and personal service workers
• 17% (31,000) were professionals
• 13% (24,100) were clerical and administrative workers
• 13% (24,000) were technicians and trade workers
• 13% (24,000) were labourers (AIHW analysis of ABS 2022a), excludes people for whom occupation was not stated or inadequately described).

In 2021, the main industries in which employed First Nations people aged 25–64 and over worked were:

• health care and social assistance (19%; about 33,000)
• public administration and safety (13%; 22,300)
• education and training (11%; 19,000)
• construction (10%; 18,200) (percentages exclude not stated/inadequately described responses) (AIHW analysis of ABS 2022c). 

Among First Nations people aged 25–64 working in the health care and social assistance industry, 78% (about 25,800) were female. Among First Nations people aged 25–64 employed in construction, 88% (about 16,000) were male (AIHW analysis of ABS 2022a). 

Main difficulties in finding work

Note – The National Aboriginal and Torres Strait Islander Social Survey (NATSISS), which collects detailed information on the social and cultural experiences of First Nations people has not been conducted since 2014–15. The following data therefore cannot be updated.

Data from the 2014–15 NATSISS showed that, of First Nations people aged 15–64 who were unemployed, 92% (48,700) reported having difficulties finding work. The main difficulties in finding work were that there were no jobs in the local area or a particular line of work (41%; 21,640), issues with transport (32%; 17,000), not having a driver’s licence (31%; 16,400) and having insufficient education or training skills (30%; 16,000) (Table D2.07.10, Figure 2.07.8). 

Figure 2.07.8: Main difficulties finding work, by type of difficulty, unemployed First Nations peolpe aged 15–64, 2014–15

Source: Table D2.07.10. AIHW and ABS analysis of National Aboriginal and Torres Strait Islander Social Survey 2014–15.

Comparisons with non-Indigenous Australians

Based on data from the 2021 ABS Census of Population and Housing, First Nations people aged 15–64 had a lower labour force participation rate than non-Indigenous Australians (60%, compared with 79%) and a lower employment rate (52%, compared with 75%) (Table D2.07.3, Figure 2.07.9).
 
The gap in employment between First Nations people and non-Indigenous Australians was substantially lower in the public sector than in the private sector. In 2021, based on Census data, just over 10% of First Nations people aged 15–64 were employed in the public sector compared with 12% of non-Indigenous Australians, including:

• 2.4% vs. 2.9% in the Australian Government, for First Nations people and non-Indigenous Australians respectively
• 6.6% vs. 8.0% in state and territory governments
• 1.5% vs. 1.0% in local governments. 

In contrast, the difference between First Nations people and non-Indigenous Australians in the employment rate in the private sector was 21 percentage points in 2021 (41% for First Nations people, compared with 62% for non-Indigenous) (AIHW analysis of ABS 2022a).

In 2021, 7.4% (around 36,000 of 485,500 people for whom labour force status was stated) of First Nations people aged 15–64 were unemployed, compared with 3.9% (589,400 of 14,971,200) of non-Indigenous Australians. Expressed as a proportion of the labour force, the unemployment rate among First Nations people aged 15–64 was 12% (around 36,000 of 289,700 people), compared with 5.0% (589,400 of 11,762,700) for non-Indigenous Australians (Table D2.07.3).

Figure 2.07.9: Employment rate, people aged 15–64, by Indigenous status and age group, 2021

Source: Table 2.07.3. AIHW analysis of ABS Census of Population and Housing.

The Closing the Gap target for employment relates to those aged 25–64 (rather than 15–64), excluding younger people (15–24) who are often still engaged in formal study. Among First Nations people aged 25–64 in 2021, 56% (188,800) were employed, compared with 78% (9,520,500) of non-Indigenous Australians (Table D2.07.3). Looking at Census data over the decade to 2021:

• between 2011 and 2016 the employment rate for both First Nations people and non-Indigenous Australians aged 25–64 changed little, and
• between 2016 and 2021, the employment rate for First Nations people aged 25–64 increased by 4.7 percentage points (51.0% to 55.7%), compared with a smaller increase of 2.0 percentage points for non-Indigenous Australians (75.7% to 77.7%), resulting in a small narrowing of the gap (from rate difference of 24.7 to 22.0 percentage points) (Table 2.07.18).

Looking at occupation among people aged 25–64, a higher proportion of employed First Nations people were community and personal service workers (17% of employed First Nations people) than non-Indigenous Australians (10% of employed non-Indigenous Australians), while a lower proportion were employed as professionals (17% compared with 27%) (ABS 2022a).

In 2021, 6.2% (21,100) of First Nations people aged 25–64 were unemployed, compared with 3.2% (396,400) of non-Indigenous Australians. When expressed as a proportion of the labour force, the unemployment rate for First Nations people aged 25–64 was 2.5 times the rate for non Indigenous Australians (10% compared with 4.0%, respectively) (Table D2.07.3). For First Nations people, the unemployment rate decreased between 2016 and 2021, from 15.0% to 10.0%, while for non-Indigenous Australians it decreased from 5.3% to 4.0%. The gap in unemployment rates was lower in 2021 (6.0 percentage points) than in 2016 (9.7 percentage points) (Table D2.07.18).

The Parliamentary Inquiry into economic self-determination and opportunities for First Nations Australians underscores the importance of employment and economic empowerment for First Nations people. Economic self-determination is crucial for improving wellbeing and breaking cycles of poverty and trauma. Key barriers to employment include poor health, disabilities, and caregiving responsibilities, with additional challenges in remote areas. The report emphasises the need for culturally competent workplaces to support the mental health and inclusion of First Nations employees (Parliament of Australia 2024).

Employment is an important determinant of health outcomes. Health benefits from being employed include providing an adequate and reliable income (see measure 2.08 Income), allowing a person to support themselves, their family and their community (AIHW 2023b) and giving the person a sense of purpose (Marmot et al. 2008). People with higher incomes may have better health outcomes because they have better access to health services, while people with poorer health may have lower incomes due to work limitations caused by their health conditions (AIHW 2015). However, employment can also negatively impact health. For instance, working long hours or facing job insecurity due to insufficient hours can lead to a decline in health (Laplagne et al. 2007). First Nations people employed in casual work reported a higher rate of mental health problems (28%) than other First Nations workers (21%) (Hunter et al. 2022). Job quality, employment conditions, the nature of work and job security are therefore essential factors of employment and its effect on health (Arthur 1999; Marmot et al. 2008; Wilkinson and Marmot 2003).

Being unemployed can unfavourably affect a person’s health. Health risks from being unemployed include the effect on a person’s physical and mental health and stress-related health effects such as heart disease (AIHW 2023a; Griffiths et al. 2022; Pickett and Wilkinson 2015; Wilkinson and Pickett 2009); material deprivation for necessities such as food security, safe neighbourhoods and adequate housing (Bambra 2011; Naidoo et al. 2024); and the effects from adopting unhealthy coping behaviours (Arena et al. 2022; Dooley et al. 1996; Mathieu et al. 2022). Extended or repeated periods of unemployment compound these effects. For example, it has been found that the population experiences poorer health and lower life expectancy following an economic downturn (AIHW 2024b; Taulbut et al. 2013).

In addition to poor health outcomes, lower levels of education and training, higher levels of contact with the criminal justice system, experiences of discrimination and lower levels of job retention may contribute to lower employment rates for First Nations people (Gray et al. 2012).

First Nations people experience barriers both in gaining employment and also while employed. While some industries have pioneered excellent initiatives to enable greater levels of First Nations employment, there continue to be barriers for many First Nations people, including a lack of access to high-quality and relevant training, limited access to supportive workplaces, inconsistent mentoring for young First Nations job seekers and few long-term job opportunities (House of Representatives Standing Committee on Indigenous Affairs 2021). In a national survey of 1,033 First Nations workers, 38% reported being treated unfairly because of their First Nations background sometimes, often or all the time (Evans 2021; Lukey et al. 2023). Additional challenges while employed included unsupportive work environments, excessive workloads, unclear role expectations, low and unequal pay, and stress from community expectations (Lai et al. 2018). In some sectors, such as out-of-home care, First Nations staff may also carry an emotional burden from fulfilling both professional duties and cultural responsibilities, which is not always recognised or supported by their workplaces (Lai et al. 2018; Lukey et al. 2023).

Historical exclusion and institutional racism have significantly impacted First Nations people's participation in education, training, and the national economy. This includes documented employment practices where First Nations peoples were required to work without pay under government policies (Leroy-Dyer 2021). These unpaid labour arrangements were part of broader systemic restrictions on access to paid employment and economic independence. Research has linked these practices to various adverse health outcomes, including elevated levels of psychological distress, chronic physical health conditions, and higher rates of attempted suicide among First Nations people (Australian Human Rights Commission 2024b; Kairuz et al. 2021). Recognising these historical injustices is essential to understanding current disparities in employment and workforce participation (Australian Human Rights Commission 2024a).

Businesses owned and led by First Nations people have stronger outcomes for First Nations employees. First Nations governance enables a workplace environment in which cultural competence is institutionally embedded, in contrast to non-Indigenous organisations where cultural competence is often an education or training exercise. Staff at First Nations businesses felt more supported to deal with racism, and to fulfil their cultural and family obligations. These benefits enhance the capacity of businesses to attract and retain First Nations staff (Eva et al. 2024). 

For First Nations people living in remote areas, poor access to transport also limits job opportunities (see measure 2.13 Transport). In addition to these workplace and logistical obstacles, more frequent interactions with the justice system can create additional barriers with factors like having a police record limiting employability. Driving Change, a driver licensing support program delivered in 11 Aboriginal communities in New South Wales, was found to be effective in improving employment outcomes for those who gained a licence. Participants who gained an independent licence were 2.5 times as likely to report a new job or change in job in the 6 months following the program (Porykali et al. 2021).

While employment is generally seen as a key determinant of health and wellbeing, its impact on health may be less significant for First Nations people. Conventional economic indicators, which focus on wealth accumulation and labour force participation, often overlook the holistic concepts of wellbeing valued by First Nations communities. These concepts encompass cultural, spiritual, ecological, physical, social, and emotional aspects. Additionally, traditional measures of economic success may not fully capture the wellbeing of First Nations people, who may prioritise different aspects of life (AIHW 2023c, 2024a).

In remote areas, young First Nations people may be less engaged in conventional work or study compared to their non-Indigenous peers. However, they often report better self-assessed health, which can be attributed to their strong involvement in cultural activities, robust social support networks, active community participation, and a deep connection to the natural environment (ABS 2024; AIHW 2023c).

The COVID-19 pandemic had a significant impact on the employment of all Australians, including First Nations people. The JobKeeper Payment, a federal initiative to help employees remain employed during the pandemic, was only available to workers in ongoing positions, or who had been in a role for at least 12 months. First Nations workers are more likely to be in casual roles, which may have affected eligibility for this initiative (Dinku et al. 2020). In December 2021, the rate of participation in youth allowance payments had decreased to pre-pandemic levels for non-Indigenous youth, but remained above pre-pandemic levels for First Nations youth. Work hours and happiness with career prospects decreased during the COVID-19 pandemic for all youth, but more so for First Nations youth (Dinku and Yap 2023).

The Australian Government implements a range of policies and programs to increase First Nations employment levels, including:

• programs that promote employment opportunities and career pathways
• employment service programs that seek to support individuals to transition into work and develop long-term careers. 

Strengthening First Nations businesses through procurement policy

Research and case studies consistently highlight the positive impact of First Nations businesses on employment and skills development for First Nations people. These businesses are significantly more likely to employ First Nations staff and provide culturally safe environments that support long-term career development (AIHW 2023c; Morrison et al. 2017; Parliament of Australia 2024). Case studies from Jobs and Skills Australia further demonstrate how these businesses foster self-determination, mentorship, and community-based values, particularly for young people entering the workforce (Jobs and Skills Australia 2023).

The First Nations business sector has grown rapidly, with around 17,900 First Nations people identified as business owners in the 2021 Census, an increase of approximately 6,320 new business owners since the 2016 Census (NIAA analysis of ABS 2022b). Ongoing research projects aim to analyse the impacts of First Nations preferential procurement policies and build a national First Nations business and economic dataset (Jobs and Skills Australia 2023).

The Commonwealth Indigenous Procurement Policy (IPP), introduced in 2015, has been a key driver of this growth. It has generated over $9.5 billion in contracting opportunities and supported more than 3,900 First Nations businesses through over 64,000 contracts. The policy’s expansion raises procurement targets from 2.5% to 3% in 2025, with a goal of 4% by 2030 (NIAA 2025).

Employment programs to support First Nations people to find work

Employment programs for First Nations people provide training, skill development, and workplace opportunities. First Nations job seekers are supported by Workforce Australia and Disability Employment Service providers in non-remote areas, and the Community Development Program (CDP) in remote areas.

Evaluations highlight the need for control over local projects, tailored services, and culturally appropriate activities. The 2018 CDP evaluation emphasised the importance of community-led initiatives that offer meaningful improvements and clear pathways to development (Jobs and Skills Australia 2023). CDP arrangements ended on 31 October 2025, replaced by the Remote Australia Employment Service (RAES) which commenced on 1 November 2025.

The design of the Remote Jobs and Economic Development (RJED) program, which will provide 3,000 jobs over 3 years from 2024–25, and the RAES, are based on feedback from remote communities requesting job creation supported by employment services, and reflect 2 targeted phases of consultations in 2023 and 2024. Feedback suggested a new program should be community-planned, recognise local roles, create jobs for locals, support those unable to work, and invest in local priorities (NIAA 2024b). 

Major evaluations of First Nations-specific employment programs, such as Indigenous Employment Programs (Deloitte and NIAA 2021), Indigenous Cadetships (NIAA 2020a) and TAEG-School Based Traineeship Program (NIAA 2020b), recommend:

• First Nations people should be involved in the design of employment programs and measuring and benchmarking success and effectiveness.
• Employers need to be supported to build internal capabilities to ensure culturally safe and appropriate employment opportunities for First Nations people.
• Governance structures need to ensure culturally safe communication between key agencies, service providers and First Nations people.
• Consistent sharing of lessons learned should take place to improve effectiveness and efficiency of programs.
• Synergies and linkages between various employment programs should be identified, and there should be flexibility in how activities are to be delivered, based on demand.

A key focus of the National Agreement on Closing the Gap is establishing and strengthening partnerships with First Nations people to share in decision-making on strategies that will boost participation in education, training and employment. This collaborative approach is essential for achieving the targets set out in the National Agreement and ensuring that First Nations people have a say in the policies that affect their lives.

The Australian Government has implemented reforms to mainstream employment services, including the launch of Workforce Australia, replacing Jobactive in July 2022. These reforms aim to provide personalised support to job seekers, including First Nations people, through digital platforms and provider networks (Australian Government 2022). The Remote Australia Employment Service (RAES), which commenced on 1 November 2025, will support remote job seekers to become job ready and access employment opportunities. 

The success of employment initiatives is greatly affected by overall economic conditions. Although the Australian labour market has been strong, potential upcoming economic challenges emphasise the need for employment services to support First Nations job seekers. These services should actively involve First Nations people, helping them develop the skills and experience required for new and emerging jobs.

Health care and social assistance is a major employment sector for First Nations people, supported in part by the Aboriginal Community Controlled Health sector. The National Aboriginal Community Controlled Health Organisation (NACCHO) delivers the Workforce and Training program, which strengthens the capacity and capability of Aboriginal Community Controlled Registered Training Organisations to deliver training that meets the evolving needs of the First Nations health sector (NACCHO 2025b). The First Nations Health Worker Traineeship Program, funded by the Australian Government and delivered by NACCHO, supports up to 500 trainees to complete Certificate III or IV qualifications, with structured workplace support to build a qualified and sustainable First Nations health workforce (Department of Health Disability and Ageing 2025; NACCHO 2025a). 

The Indigenous Skills and Employment Program (ISEP) aims to connect First Nations people to jobs, career advancement opportunities, and new training and job-ready activities through flexible local projects that have been designed with community input. This program, along with the Remote Jobs and Economic Development (RJED) program, which delivers real jobs that communities want with good pay and conditions, is developed in partnership with First Nations people to ensure remote employment programs meet their needs and aspirations. The 2024–25 budget allocated $777.4 million over 5 years to the RJED program, funding the creation of 3,000 real jobs (NIAA 2024a).

The Boosting First Nations Employment in the Australian Public Service (APS) to 5% by 2030 initiative represents an accelerated and concentrated effort through the establishment of a First Nations Unit in the Australian Public Service Commission, which will focus on whole of service senior representation, retention and cultural capability. This approach will be monitored to assess effectiveness and refined over time. 

The Commonwealth Aboriginal and Torres Strait Islander Workforce Strategy 2020–2024 (Strategy) was released with 3 areas of focus: cultural integrity, career pathways and career development and advancement. The Strategy outlines targets for First Nations representation in the APS. Despite these targets, representation has remained around 3.6% over the last decade (2016–2025), having increased from an average of 2.8% in the previous decade (2006–2015) (Australian Public Service Commission 2025). Since the launch of the Strategy the Australian Government announced a target for First Nations people in the public service of 5% by 2030 and an action plan will be developed to position the Strategy within that revised policy context. 

The National Aboriginal and Torres Strait Islander Health Workforce Strategic Framework and Implementation Plan 2021- 2031 (Workforce Plan) aims to increase the proportion of First Nations people in the health workforce to reach population parity by 2031 and strengthen the cultural safety of the health system more broadly to eliminate racism from workplaces and from the provision of care. The Workforce Plan is guided by 6 overarching strategic directions to attract, recruit and retain First Nations health workers and 47 implementation strategies. 

Employment services alone cannot close the gap. There is a need for ongoing employment growth combined with improving educational attainment among First Nations people. The 2025 Closing the Gap Implementation Plan emphasises improving Vocational Education and Training (VET) and higher education outcomes for First Nations people to enhance their participation in the labour market (see measure 2.06 Educational participation and attainment of adults).

Approaches with the potential to increase employment for First Nations people include increasing skill levels; pre-employment assessment and training; intensive assistance for job seekers; non-standard recruitment strategies; support for retention; wage subsidies and employment targets in government programs. These can be strengthened by formal training and microcredentials that recognise on-the-job learning, and by ensuring that learning and development opportunities are locally available and tailored to the community context (Department of Education 2022; Martinez-Marroquin and Male 2021; Queensland Government 2023). Such approaches support not only employment initiation but also retention and job satisfaction. Structural changes across housing, industry, transport and roads, education and health services can also help with the employment of First Nations people (Gray and Hunter 2016; Gray et al. 2012). 

As recommended by Reconciliation Australia, workplaces looking to improve their retention of First Nations employees should accommodate cultural requirements that may interfere with employment, such as leave for Sorry Business or flexible work arrangements that allow for working on Country, as this supports First Nations employees to feel culturally safe. It is crucial for reporting frameworks to recognise, alongside conventional measures, that different cultures may have different constructs and experiences of employment and work (Carson et al. 2007; Dockery 2010).

The Australian Public Service Commission emphasises the importance of cultural capability and safety in boosting First Nations employment outcomes (APSC 2024). Cultural competency training for staff that addresses racism and discrimination in the workplace, and the cultural load that First Nations people are often subjected to, can also improve the retention rate and career development of First Nations employees (Minderoo Foundation et al. 2022).

These initiatives highlight the need for a holistic approach that combines employment services, educational attainment, cultural competency, and targeted strategies to improve First Nations employment outcomes and economic empowerment. By recognising the unique cultural and economic contexts of First Nations people, these policies can contribute to closing the employment gap and fostering long-term economic empowerment.

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