The nature of poverty is changing

There is an ongoing debate about how to define poverty, and we need better data (see this recent post from the Resolution Foundation for a discussion of both issues). Nonetheless, some major changes in the nature of poverty in the UK over recent years are clearly visible. In particular, the number of people in ‘deep’ poverty or destitution has risen sharply over the last two decades, with especially pronounced rises among families with three or more children, lone-parent families and households including a disabled person. Since 2007/08, people in deep poverty have suffered a substantial reduction in average incomes, whilst people closer to the poverty line have seen modest increases. The numbers of people in deep poverty are set to increase further over the coming months due to the ever-increasing cost of living.

Just as with poverty overall, rates of deep poverty are higher for households headed by someone of black, Asian and minority ethnicity. Key drivers of higher poverty rates among minority ethnic households are differences in family composition, employment rates and the likelihood of working in low-paying sectors. There has been progress over recent years in reducing the proportion of certain ethnic groups in deep poverty, but there is a risk that the rapid increase in the cost of living will reverse this trend, and over half of the increase in deep poverty over the last two decades is made up of people from ethnic minorities. (See also this related JRF post on destitution and disability, and this recent Runnymede Trust report on poverty, inequality and ethnicity in the UK.)

A narrow focus on poverty, income, wealth or class overlooks the critical importance of economic security, which is a key dividing line in British politics. Many young graduates may have low incomes, but most of them have high future earnings potential. Many pensioners might have low incomes, but most are economically secure because they rode the mid-century wave of high employment and the housing boom, even if they did not have a degree. The most economically insecure (and therefore left behind) group in Britain are younger non-graduates (women under 50 and men under 40), especially those who are out of work or in part-time work. Women and ethnic minorities are more economically insecure than white and male Britons.