Before the pandemic, many families were already feeling the strain of increasing living costs, transport, and childcare. During the pandemic, thousands of people were made redundant or lost income on the furlough scheme.
The current cuts to benefits coupled with the rise in energy and food prices mean many will struggle this winter and need to choose between heating and eating, relying on food banks when things get tough.
The poverty problem is not solely affecting unemployed people with in-work poverty hitting an all-time high.
How many people are in poverty in the UK?
Pre-pandemic it was estimated that one in every four people were in poverty. That’s a staggering 14.5 million people and since then has risen to over 15 million.
Some groups are more likely to be in poverty, due to race, life events such as illness or the economy.
- People from ethnic minority groups are more likely to be in poverty than people from white ethnic groups.
- 40% of working-aged adults in workless families are in relative poverty compared with 11% of households where at least one adult works.
- 33% of private renters live in relative poverty compared to 11% of people with a mortgage
- 27% of families living with someone with a disability live in relative poverty.
Unemployment and poverty?
People who are unemployed or find low-paid insecure work struggle to escape poverty and break the cycle due to rising house costs, food bills, and energy prices.
The UK’s welfare system has also been criticised for not supporting those on the lowest incomes. Universal Credit doesn’t provide enough for people in work, seeking work, or dealing with health issues to avoid poverty. The recent cuts to Universal Credit add further hardship to an already struggling community.
Research shows that the UK is at an all-time high in regards to in-work poverty. The chances of families with both adults working falling into poverty has doubled over the last two decades.
The rise in house prices has forced people to rent and with the rise in rent costs doubling over the last 25 years, wages have not kept up to this rate of inflation. Add to this the soaring price of childcare and it’s easy to see why working families are struggling.
Child poverty in the UK
While reducing child poverty was made a priority in the mid-2000s and saw a decline it has since risen to over 4.3 million across the UK, nine in each school classroom.
Having working parents doesn’t guarantee children won’t grow up in poverty with around 75% of children in poverty living in households where at least one person works. Children living with a single parent are nearly 50% more likely to be living in poverty than their peers.
Children from black and ethnic minority groups are more likely to live in poverty when compared to children from white British families, as well as children from larger families as benefits only support the first two children in a family.
The biggest financial strain on families is housing costs and expensive childcare.
Has Covid-19 affected poverty?
An extra 700,000 people entered poverty during the pandemic. New factors contributed to growing poverty levels, including higher energy bills from working from home and larger food bills to feed children who usually received free school meals.
Thousands of people also lost their jobs and even those who kept jobs were forced to survive on less money as furlough only covered 80% of their wages.
How can we end poverty?
Many agree that a complete reform of the welfare system is needed to help reduce poverty in the UK.
The current Universal Credit system is extremely flawed; it takes five weeks to receive a payment forcing people into further debt, there is a two-child limit when claiming benefits, the benefit cap limits the total people can claim even if they are entitled to more.
It is clear to see that without a clear long-term outlook and overhaul of the current systems that the country is facing larger social security bills and a constant increase in the number of families and children living in poverty.