In-work child poverty highest on record

06 December 2010

A new report published today (6 December, 2010) by the Joseph Rowntree Foundation shows the number of children living in poverty in working households has increased to 2.1m – the highest on record.

The thirteenth Monitoring Poverty and Social Exclusion report, written by a team from the New Policy Institute (NPI), is the first to be published under the new government. It looks at the long-term trends, as well as more recent changes from the recession, and highlights the challenges faced.

The report shows that, despite the recession, overall the number of children living in poverty fell to 3.7m, with the number in workless households falling to 1.6m, the lowest since 1984. But those in working families rose slightly to 2.1m, and they now account for 58% of the total.

Co-author of the report, Tom MacInnes, said: "The fall in child poverty among those in out-of-work households came about despite an estimated rise of 60,000 in the number of children living in workless households over the year. So, we can almost certainly say that it is related to the rise in both Child Benefit and Child Tax Credit in 2008. Without the substantial increases in these benefits, the numbers of children in poverty would be around half a million higher."

"With more than half of all children in poverty belonging to working families, it is simply not possible to base anti-poverty policies on the idea that work alone is a route out of poverty. Child poverty in working households must be given the same focus as out-of-work poverty. Until this happens, debates about poverty will continue to be misleading".

Other points the researchers have covered in the report include:

  • By 2008/09, 13m people were in poverty. Of these, 5.8m (44% of the total) were in 'deep poverty', the highest proportion on record.
  • By mid-2010, the unemployment rate among those aged16-24 was, at 20%, the highest in 18 years, and three times that for other adults. After the last recession (1993), the rate was 16%, twice as high as for the rest of the population.
  • By mid-2010, almost 2.5m people in the UK were unemployed, slightly more than in 2009. In total, around 6m were unemployed, 'economically inactive' but wanting work, or employed part-time and unable to find full-time work.
  • While Jobseeker's Allowance claimants peaked at 1.6m in 2009, 4.2m people (one in eight of the economically active population) claimed at least once in the two years from the start of the recession in spring 2008.
  • Despite overall reductions, health inequalities between different class and/or income groups remain wide and persistent. For instance, the risk of mental illness for someone in the poorest fifth of the population is around twice the average.
  • Although there have been improvements in educational attainment, 2009 saw the first rise in the proportion of children, aged 11, not reaching basic levels of numeracy and literacy for over a decade.

Co-author, Anushree Parekh, said: "The high level of young adult unemployment has been a striking feature of this recession. One in five adults aged under 25 who are looking for work cannot find it. But young adult unemployment has been rising since 2004 – this is a long term, chronic problem.

"Across the working age population as a whole, with unemployment having risen by 540,000 since 2008/09 and the wider measure of underemployment having gone up by 920,000, it is impossible to see how anything other than another large rise in poverty can be expected next year."

Julia Unwin, Chief Executive of JRF, said: "Although it is important to recognise the reduction in child and pensioner poverty over the last decade, the government now faces many challenges, not solely related to work and poverty. The large numbers of young adults with few or no qualifications, persistent health inequalities and the lack of access for poor families to essential services, all make reducing social exclusion much more difficult. Welfare Reform alone is nowhere near enough."

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