In work but still in poverty – the reality for many in 2014

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A changing picture of poverty in modern Britain means that there are as many people from working families living in poverty as from workless ones.

Falling wages and a vast increase in “insecure work”, such as zero-hours contracts, part-time work and low-paid self-employment, has meant that finding a job today does not necessarily mean getting out of poverty.

This story of poverty in Britain today has been described in Monitoring Poverty and Social Exclusion, the annual report from social justice charity the Joseph Rowntree Foundation.

It confirms that there are now 13 million people living in poverty in the UK, with as many as 6.6 million of these living in working families. Within this figure, as many as 3.7 million children are living in poverty – a number which has doubled during the past 30 years.

The National Association of Head Teachers this week said the report’s findings were of “great concern” as the number of young people living in poverty increases and those leaving school face greater problems finding secure employment to lift them out of poverty.

General secretary Russell Hobby called for the next government to protect funding for education and early years to help tackle the affects of poverty on education.

The report confirms that there has been a big rise in the proportion of adults aged under-25 in poverty. It also shows that:

  • Two-thirds of people who moved from unemployment into work in the last year are paid below the Living Wage.

  • Only a fifth of low-paid employees have left low-paid work completely 10 years later.

  • There are around 1.4 million contracts not guaranteeing a minimum number of hours – and over half are in the lower-paying food, accommodation, retail and admin sectors.

While the report acknowledges that the employment rate in the UK is close to a “historic high”, it emphasises that incomes are lower on average than 10 years ago, with the worst-off having seen the biggest falls – of around 10 per cent.

Overall, average income is down by nine per cent between 2007/08 and 2012/13. Average real-terms wages for men working full-time have dropped from £13.90 to £12.90 an hour between 2008 and 2013. For women, they have fallen from £10.80 to £10.30. For the lowest paid quarter of men, hourly pay fell by 70p per hour and for women it fell 40p per hour.

Elsewhere, the report claims that changes to the welfare system have “worsened the experience of poverty for many of those affected”, including through rising sanctions, longer waits for assessment, or poor job outcomes through welfare-to-work programmes.

When it comes to child poverty, the report confirms that this remains highest in city areas, with Tower Hamlets in London having the highest rate (with 49 per cent of children living in poverty), followed by Newham and Hackney. The highest areas outside London were Manchester (39 per cent) and Birmingham (37 per cent).

Coastal areas also suffer more from child poverty, with much of the Kent coast having a rate of more than 25 per cent. There is a similar picture along the North East coastline.

Currently, 62 per cent of children on free school meals (FSM) fail to get five GCSEs at grades A* to C including English and maths (for non-FSM children, the figure is 35 per cent). 

However, the report highlights that educational opportunities seem to be better for disadvantaged children living in urban areas, with the 15 best areas for FSM attainment all being in London.

Mr Hobby said that the pressure on a family of living in poverty had a knock-on affect on children’s education and has warned that many families are not qualifying for support.

He explained: “We have said before that poverty does not inevitably cause educational underachievement. However, it is inextricably linked to factors that also harm education. 

“For instance, there’s now a significant proportion of families with two working parents who are sometimes working more than one job each just to make ends meet. In so doing, they find themselves ‘not quite poor enough’ to qualify for help from the system. 

“Within the context of this report, it is these families that we have particular concern for. Parents under this kind of pressure may struggle to play a fully effective role in their children’s education.”

Mr Hobby called for a “rapid political acknowledgement of the realities of modern poverty”. He continued: “All the evidence shows that the earlier you start to tackle poverty, the more lasting the outcomes. 

“Whichever political party holds power after the general election, further cuts to public services remain a risk. 

“We believe that funding for education and early years should be protected, in order that the current generation of children don’t leave school to face the same low standard opportunities as we see today.”

Julia Unwin, chief executive of the Joseph Rowntree Foundation, said: “This year’s report shows a real change in UK society over a relatively short period of time. We are concerned that the economic recovery we face will still have so many people living in poverty. 

“It is a risk, waste and cost we cannot afford: we will never reach our full economic potential with so many people struggling to make ends meet. 

“A comprehensive strategy is needed to tackle poverty in the UK. It must tackle the root causes of poverty, such as low pay and the high cost of essentials.”


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