Using Census data to derive a new area-based measure of deprivation - Section 6: Indices of Deprivation

Section 6: How does our measure compare to the Indices of Deprivation?

For our measure to be valuable and useful to end users, it should ideally be able to overcome some of the known limitations of the Indices of Deprivation. The aim of this section is to therefore explore whether this is the case across the various nations of the UK.

As we have income estimates at the MSOA level in England, one of our first lines of analysis in this country was to look at the average net equivalised weekly household income (after accounting for housing costs) of those living in areas that fall into the bottom quintile of the English Index of Multiple Deprivation (IMD). The mean value was found to be £357.31, which is only slightly lower than the figure one obtains if they consider the lowest quintile of our composite measure (£361.69). Similar averages were also found if focus was placed on particular domains of IMD, such as income and education, as well as for IDACI.

29,536 output areas were located within the bottom quintile of our composite measure, with 9,196 of these not being found in the corresponding quintile of IMD – representing almost a third of the total. Figure 8 provides a map of these 9,196 vicinities, with a darker shade indicating a higher proportion of output areas emerging in that part of the country. When looking at where those output areas only found in the bottom quintile of our composite measure were located, we observed that 30% were in central England, with just over a quarter found in East of England or Yorkshire and The Humber.

Figure 8: The location of the output areas that emerge in the bottom quintile of our composite measure, but not the equivalent quintile of IMD. A darker shade indicates a higher proportion of output areas appeared within that local authority

Furthermore, when examining the types of areas that the bottom quintile of IMD tends to capture, only 3% are classified as rural areas. Rather, IMD appears particularly effective in catching localities in major urban areas, such as London and Birmingham. Indeed, one of the key differences we find is that 12% of output areas within the bottom quintile of IMD are in London, with the equivalent figure being 3% for our Census measure. In contrast, 7% of areas in the lowest quintile of our measure are rural locations, with our measure tending to pick up a greater proportion of medium and large towns in England. Table 4 illustrates the urban/rural classification of the output areas that fall into the bottom quintile of our composite measure, but a higher quintile of IMD.

Table 4: Urban/rural classification of areas that fall into the bottom quintile of our composite measure, but not the equivalent quintile of IMD

When assessing how our measure compared to some of the individual domains of IMD/IDACI, we found that similar overall conclusions were reached when considering IDACI, as well as the income and employment domains. That is, around a third of output areas in the bottom quintile of our measure did not appear in the equivalent quintile of these variables. Typically, IDACI and these components of IMD were again found to be picking up predominantly major urban conurbations and very few rural areas. The indicator that showed greatest similarity with our own measure was the education domain. However, even in this instance, approximately a quarter of the output areas that emerged in the bottom quintile of our measure were located in a higher quintile of the education domain, with these localities typically found in northern and central England. Around 15% of these output areas were classified as rural, with approximately 45% being urban cities and towns.

In Scotland, modelled estimates of income and poverty relating to the period 2008/09 have been published by the Scottish Government (2014). We utilise the weekly net equivalent household income after housing costs below to assist us in contextualising our findings. Please note that these estimates could not be directly incorporated into our dataset as the geography codes utilised are based on the 2001 Census. As has been highlighted in statistics released on SIMD, not all council areas are covered in the bottom quintile of this index, despite these areas being known to have deprivation. For example, Na h-Eileanan Siar is a place that does not feature in the bottom quintile of SIMD, despite Scottish Government (2014) estimates indicating that it has a median weekly income of £334, which is below the national average of £349. 13,358 output areas in Scotland fall within the bottom quintile of our composite measure, with just under half (46%) appearing in a higher quintile of SIMD. One of the key differences between our measure and SIMD (as Figure 9 illustrates) is that all parts of Scotland are covered through the bottom quintile of our index.

Figure 9: The location of the output areas that emerge in the bottom quintile of our composite measure, but not the equivalent quintile of SIMD. A darker shade indicates a higher proportion of output areas appeared within that council

As we pointed out earlier, one of the main criticisms of SIMD is its inability to capture more rural parts of the country. Our statistics show that only around 10% of areas in the bottom quintile of SIMD are listed as small towns and rural areas. In contrast, of the localities in the lowest 20% of our measure, 12% are classed as accessible or remote small towns, with a further 8% categorised as accessible/remote rural vicinities. Table 5 demonstrates the urban/rural classification of those output areas that are in the lowest quintile of our measure, but a higher quintile of IMD.

Even if one were to compare our measure with the income, employment and education domains of SIMD, the overall conclusions we report here do not change. That is, just under half of output areas that are in the bottom quintile of our measure are in a higher quintile of the SIMD domain being considered, with our measure able to capture a larger proportion of small towns and rural areas.

Table 5: Urban/rural classification of areas that emerge in bottom quintile of our composite measure, but not the equivalent quintile of SIMD

A similar approach to that taken for England was applied for our analysis in Wales. That is, we began by utilising the MSOA income estimates to understand how the net weekly household income levels (equivalised and after housing costs) compared between the bottom quintile of our composite measure and WIMD. We found the mean value to be £330.63 for WIMD, with a similar estimate emerging if one were to concentrate on the income, employment or education domains of WIMD. A slightly higher mean figure was found for our composite measure (£340.37).

2,329 output areas fall into the bottom quintile of our composite measure, with 974 (42%) of these being based in a higher quintile of WIMD. While these 974 output areas are spread across all parts of Wales (Figure 10), we do find that almost a quarter of these are found in two local authorities in south Wales (Rhondda and Caerphilly).

Figure 10: The location of the output areas that emerge in the bottom quintile of our composite measure, but not the equivalent quintile of WIMD. A darker shade indicates a higher proportion of output areas appeared within that local authority

As in the other nations assessed so far, we find that the bottom quintile of our composite measure comprises of a larger proportion of rural areas than WIMD. One-fifth of areas in the bottom quintile of our measure are categorised as rural compared with approximately 14% for WIMD. Table 6 illustrates that almost 30% of output areas that are found only in the bottom quintile of our composite measure are classed as rural locations. Similar findings emerge for Wales if we were to compare our measure with the income, employment or education domains of WIMD.

Table 6: Urban/rural classification of areas that emerge in the bottom quintile of our composite measure, but not in the equivalent quintile of WIMD

Within Northern Ireland, 1,236 output areas fall into the bottom quintile of our composite measure, with nearly 50% (606) of these localities found in a higher quintile of NIMDM. As the map below illustrates (Figure 11), those places that emerge in the bottom quintile of our measure only are generally found in north and/or eastern parts of Northern Ireland.

Figure 11: The location of the output areas that emerge in the bottom quintile of our composite measure, but not the equivalent quintile of NIMDM. A darker shade indicates a higher proportion of output areas appeared within that local government district

Table 7 highlights the urban/rural classification of areas that fall into the bottom quintile of our measure, but a higher quintile of NIMDM. Overall though, when looking at the urban/rural classification of areas in the bottom quintile of each measure separately, we do not observe a great deal of difference. 81% of output areas in the bottom quintile of our measure are classified as urban, with the figure being marginally higher (84%) for the lowest 20% of areas according to NIMDM. So far, when we have extended our work to include comparisons between individual domains and our measure, the conclusions we have drawn have not been altered. In Northern Ireland, however, an assessment of our measure against the income or IDAC domains does lead to different results to what we see for the overall index. In particular, around 30% of output areas in the bottom quintile of either domain are classified as rural, which bucks the general trend we have seen across nations (i.e. that our measure captures a greater proportion of rural spots).

Table 7: Urban/rural classification of areas that emerge in the bottom quintile of our composite measure, but not in the equivalent quintile of NIMDM

Next: Section 7: Discussion and concluding remarks