In-work poverty trends
About 2 mins
Key points
- 65% of children and working-age adults in poverty in 2023/24 lived in families where at least one adult was working part-time or more, up from 56% in 2012/13 and 44% in 1996/97.
- 18% of children and working-age adults in poverty in 2023/24 lived in families where all adults were working and at least one adult was working full-time (referred to here as high work intensity families), which is up from 13% in 2012/13 and 9% in 1996/97.
Poverty can affect people’s health, as the financial resources people have are not enough to meet their basic living needs, such as adequate heating for their home, appropriate clothing or adequate nutrition. Research shows that people in poverty who live in working families fare better in terms of income, material deprivation and financial stress than people out of work, but people in poverty fare worse than people who are not in poverty regardless of their work status.
The chart looks at the share of people in poverty in households which have at least one adult in work, each year since 1996/97. It is divided into higher and lower work intensity families. In higher work intensity families, all adults are working and at least one adult is working full-time.
- People in families with high work intensity made up 18% of all people in poverty in 2023/24, which is an increase compared with 17% in 2022/23. This is a higher percentage than a decade earlier – 13% in 2012/13 – and it represents a large increase on the proportion in 1996/97 (9%).
- People from low work intensity families comprised 46% of people living in poverty in 2023/24 – which is similar to the previous year (47%). This is higher than the proportion a decade earlier (43% in 2012/13) and much higher than the proportion in 1996/97 (35%).
There are a number of explanations for the growth of in-work poverty over the last two decades. Partly, this trend reflects the fact that a higher proportion of families have a family member in work than in the past. However, there is an increased risk of being in poverty for people in work, reflecting the growth in housing costs for working families and the faster growth of pensioner incomes, which has raised the overall median (increasing the income required to be above the poverty threshold).
- Years shown are 3-year pooled averages, to maximise sample sizes. For example 2002/03 is a 3-year pooling of 2000/01, 2001/02 and 2002/03. Data for 2020/21 have not been included in the pooling, so 2021/22 and 2022/23 figures are 2-year pooled averages. This is in line with the Department for Work and Pensions’ guidance related to data quality during the COVID-19 pandemic, when data were affected by the pandemic and were subject to additional uncertainty. Data for these periods should be viewed with caution and in line with broader trends.
- A person is classified as being in poverty if they are living in a household with a net household income below 60% of the median in that year.
- Income is equivalised, which means it is adjusted for household size to reflect economies of scale. For example, a household of four needs more income for the same standard of living as a household of one, but not four times as much.
- Housing costs are deducted from income, to reflect that people with lower incomes in particular have fewer options for meeting their housing costs, relative to their income.
- Lower work intensity families are those where an adult is self-employed, only one adult works full-time and the other adult does not work, or those families where adults only work part-time. Higher work intensity families are those where every adult works, with at least one adult working full-time.
- The category ‘pensioner’ is the technical term used in the statistics produced by the Department for Work and Pensions. ‘Pensioner’ is not our preferred wording at the Health Foundation but is accurate to use in this context.
Source: Department for Work and Pensions, Households Below Average Income, UK, 1996/97 to 2023/24
