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3.5 Labour force participation and unemploymentBox 3.5.1Key messages• In 2004-05, after adjusting for age differences:– the labour force participation rate for Indigenous people (58.5 per cent) wasabout three quarters of that for non-Indigenous people (78.1 per cent)(figure 3.5.3)– the unemployment rate for Indigenous people (12.9 per cent) was about 3 timesthe rate for non-Indigenous people (4.4 per cent) (figure 3.5.6).• From 1994 to 2004-05:– the participation rate for Indigenous women increased from 41.5 per cent to52.6 per cent. The rate for Indigenous men remained constant (figure 3.5.5)– the Indigenous unemployment rate fell from 30.0 per cent to 12.8 per cent. Theunemployment rate fell for both men and women (figure 3.5.9)– CDEP participation rates remained stable (figure 3.5.2). CDEP participationsignificantly reduces recorded Indigenous unemployment rates and increasesrecorded labour force participation rates, particularly in remote areas.Labour force participation and unemployment has been chosen as a headlineindicator because labour market outcomes are directly related to people’s livingstandard and many aspects of their wellbeing. Being employed leads to improvedincome for families and communities (which in turn has a positive influence onhealth and the education of children). It also enhances self-esteem, increasesopportunities for self development, influences interaction at the family andcommunity levels and reduces social alienation. Employment is discussed in moredetail in chapter 11. The focus of this section is the extent to which people areparticipating in the labour force or are unemployed.The labour force is the most widely used measure of the economically activepopulation or the formal supply of labour.The labour force is a measure of the number of people contributing to, or willing tocontribute to, the supply of labour and, as defined by the ABS, comprises twomutually exclusive categories of people:• the employed (people who have worked for at least one hour in the referenceweek, including those who have participated in Community DevelopmentEmployment Projects (CDEP))• the unemployed (people who are without work, but are actively looking for workand available to start work within four weeks).HEADLINEINDICATORS39