60% of Britons In Poverty Are In Working Families


July 3, 2017 by Stuart Smale

A new report by researchers at Cardiff University has revealed that a record number of British people in poverty in the UK live in a household where somebody is in work. The report analysed the latest data from the Department Of Work and Pensions ‘Households Below Average Income: 1994/95 to 2014/15’ as well as the Understanding Society Report that is a survey of about 40,000 households in the UK. The shocking fact is that 60% of Britons in poverty are working families with the risk of falling into severe financial hardship, which is very high for families living in private, rented housing.

This suggests that the insistence of successive UK governments that work is the best way out of poverty is not working, although Theresa May insists that this should still be the case. When asked in a recent interview about the impact of benefit changes under the Conservative government that has affected many of the poorer elements of society, she said:

“I think work is the best route out of poverty. So yes, we need a system that provides support for those who need it, but I think we need to incentivise people to get into the workplace. We also have to think when we’re looking at welfare for the taxpayers who are paying for those welfare benefits.”

The Risk Of In-Work Poverty Has Grown By 25%

However, Cardiff University academics have reported that the risk of poverty for adults in working families has grown by over 25% in the past 10 years. The report suggests that as well as low pay being a driver for in-work poverty, the number of workers in a household is key. Those families that have just one worker in the household are at an increasingly high risk of in-work poverty, says social policy lecturer at Cardiff University Rod Hick:

“It’s increasingly challenging to have that type of family structure. The poverty risks for families in that position are pretty high. So tackling in-work poverty requires rethinking our approach – it’s about improving the circumstances of the whole household, not just those of an individual worker, and promoting employment is key.”

Those working families in private rented housing are also at an increased risk of being in poverty. Hit by a combination of caps on benefits as well as rising rents, the continuing lack of social housing will see more and more working families in this type of property risk falling into in-work poverty. Rod Hick from Cardiff University commented:

“Tackling in-work poverty requires rethinking our approach – it’s about improving the circumstances of the whole household, not just those of an individual worker, and promoting employment is key.”

Whether anything will happen to tackle this rising problem will depend upon several factors, not least the forthcoming General Election outcome.

Is the managing director of Cobra Payday Loans and Ready Money Capital Limited. He is responsible for all the day to day functions and performance of both companies and regularly contributes information on the short term finance sector. Stuart is an approved person with the Financial Conduct Authority, holding SMF3 (Executive Director) status.

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