19 million Brits are on the edge of poverty even though nearly everyone has a job — and it’s going to get worse

LONDON — New research shows that millions more people in Britain are struggling to make ends meet since the financial crisis and predicts that the situation could drastically worsen over the next few years as inflation spikes.

Research by the Joseph Rowntree Foundation released on Wednesday found that:

  • 30% of the population, 19 million people, are now below the “minimum income standard” [MIS].
  • The number below MIS has risen by 4 million since 2008/9, or a 5 percentage point rise;
  • 11 million people have incomes below 75% of MIS and are at high risk of poverty;
  • 8 million people are just about managing to get by.

MIS is an income benchmark calculated by the Centre for Research in Social Policy (CRSP) at Loughborough University. It is based on extensive surveys of people in the UK, asking them what they believe is a reasonable income.

MIS in 2016 for a single person of working age was £286.53 per week before bills, equivalent to £14,899 a year. For couples, it was £353.21 a week, or £18,366 a year. For a couple with two children, it was £776.28 a week, or £40,366 a year.

These are relatively modest budgets. The Institute for Fiscal Studies (IFS) found last year that the average income for a childless couple in the UK was £581 in 2014-15, or £30,212. That is over £10,000 more than they need under the MIS system.

The fact that so many people in the UK fall short of this relatively low threshold is alarming.

It also comes at a time when the UK is experiencing record low unemployment levels. New data released on Wednesday shows that Britain’s unemployment level remains at 4.8%, a 10-year low. Just 1.6 million people are officially unemployed.

Families with children have the highest risk of incomes that fall short of the standard, according to the report. More than half of families with children and just one parent in work are below the MIS — 56%.

The Joseph Rowntree Foundation, a social policy and development charity, says the rising risk of poverty is due to sluggish income growth rather than any increase in unemployment.

The charity says: “The price of a minimum “basket of goods” has risen 27-30% since 2008, and average earnings by only half that amount.”

Britain’s employment market has seen the rise of the so-called “gig economy” since the 2008 financial crisis, with more and more people doing low-paid, self-employed jobs such as driving Ubers or delivering food for Deliveroo. Trade union TUC estimated this week that the irregular hours and lower earnings of these types of workers means the government is missing out on £4 billion of tax revenue a year. This means these workers are missing out on pay too.

The Trussel Trust, a charity runs the UK’s only national network of food banks, said last April that food bank usage was at a record high of 1.1 million. Almost half a million emergency food supplies were given to children.

The Rowntree Foundation’s report is supported by Office for National Statistics data, which last year found that 33% of people were in poverty at least once between 2010-13 compared to an EU average of 25%.

read more: http://uk.businessinsider.com/theresa-mays-jams-joseph-rowntree-foundation-finds-4-million-people-just-above-poverty-line-2017-2

 

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