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Child Poverty - Young girl looks out of dirty windows

In-work poverty increases

A new report from the Institute of Fiscal Studies, Living standards, poverty and inequality in the UK: 2019, has revealed a fifth of working households are trapped in relative poverty.

Relative poverty now afflicts almost a fifth of people living in working households in the UK. This is an increase of 40 per cent from the mid-1990s, driven in part by higher rents in private and social housing, according to the research.

The report reveals two key reasons for this are steeper housing costs for the low-paid, including higher rents and lower housing benefits, and much slower growth in their earnings compared with higher earners.  But there are other reasons for the rise in relative poverty, defined as a household income lower than 60 per cent of median income.

Many in the previously jobless groups, such as lone parents, have moved into low-paid work, pushing up the rate despite becoming themselves better-off. Secondly, rapid growth in pensioners’ incomes over the past 25 years has lifted median income, meaning more working families have fallen below the relative poverty line.

Read: the Independent – Fifth of people in working UK households trapped in relative poverty