In work and in poverty

Majority of children in poverty live in working households

More than half of children living in poverty in Scotland are growing up in households where at least one person is in employment – and that number is rising, according to new research published today.

Speaking in a debate in the Scottish Parliament later today, Cabinet Secretary for Fair Work, Skills and Training Roseanna Cunningham will argue that it is unacceptable that work is no longer the straight forward route out of poverty and will reiterate the Scottish Government’s pledge to tackle inequality and build a fairer Scotland.

The Cabinet Secretary is speaking as research published today shows that the proportion of those in in-work poverty is gradually increasing and that for many, moving into work doesn’t necessarily mean moving out of poverty.

Ms Cunningham said: “It cannot be right that the majority of working age adults in poverty in Scotland are in ‘in-work’ poverty. Well-rewarded and sustained employment is the best route out of poverty, for those who are able to work, and one of the best ways to tackle inequality.

“This is why we are prioritising the promotion of the living wage and working closely with the Poverty Alliance to encourage more employers to sign up to the Living Wage accreditation scheme. Business productivity goes hand in hand with fair and equal pay. We must all be fully committed to fair work.”

The Scottish Government is developing a Scottish Business pledge to invite companies to commit to extending the living wage, involve their local communities and invest in youth training and employment. In return businesses will be offered a package of tailored support on skills, innovation and exports to help them grow and prosper.

New research looking at in-work poverty summaries the evidence about the extent and impact of in-work poverty in Scotland. It identifies three key factors that influence in-work poverty – hourly rate of play; number of hours worked by members of the household; income gained and lost through the welfare and tax systems.

The main findings of the research include:

• The majority of working age adults in poverty, 52 per cent, are in in-work poverty and that number is increasing

• For children in poverty, 59 per cent are living in households with someone in employment which can have a profound and lasting impact on children’s outcomes

• In work poverty is costly to society via payment of tax credits and other in work benefits which top up low income

• Having one earner in the household means families may be more at risk of poverty at a time when the average living standard, and hence the relative poverty threshold, is increasingly determined by the living standard of double-earner households

• Low-wage work is a ‘dead end’ for many. Workers who are low paid at any one time are more likely to remain in low pay later in life.

You can view the Summary of Evidence Report at :http://www.scotland.gov.uk/Publications/2015/01/3233